Unfortunately, in today’s economy, businesses are having financial issues. According to the Wall Street Journal, recession fears has prompted Facebook parent Meta, Alphabet, Microsoft and Goldman Sachs to cut employees. CNN further reports that companies such as BuzzFeed, Lyft, Whole Foods, Deloitte, Tyson Foods, 3M, Walmart, and Disney will be reducing their workforce.
As an employment discrimination lawyer, I often encounter questions about how reductions in force (“RIFs”) should be handled under various employment statutes. In this blog, I will explain the basics of navigating RIFs under three important laws: Title VII of the Civil Rights Act of 1964, the Age Discrimination in Employment Act of 1967 (“ADEA”), and Americans with Disabilities Act (“ADA”). Understanding these laws is crucial for both employers and employees to ensure fair treatment during RIFs. Let’s delve into it!
What Qualifies as a Reduction in Force (RIF)?
A reduction in force, often referred to as a RIF, occurs when an employer implements measures to reduce its workforce due to various reasons such as financial difficulties, reorganization, technological advancements, or changes in business needs. While there is no specific percentage or numerical threshold that determines whether a RIF has taken place, it generally involves a significant reduction in the number of employees.
In practice, a RIF can vary in scope and scale depending on the circumstances and needs of the employer. It can range from a few individuals being let go to a substantial reduction affecting a significant portion of the workforce. The key factor in determining whether a RIF has occurred is whether the employer has made deliberate decisions to eliminate positions or terminate employees due to the intended reduction in workforce size.
It’s important to note that the decision to conduct a RIF should be based on legitimate business reasons and not driven by discriminatory motives. Employers must ensure that the selection process for identifying employees to be laid off is fair and non-discriminatory, as discussed earlier in relation to Title VII, ADEA, and ADA.
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Can I sue for discrimination if I was fired as part of a reduction in force?
Possibly. Employers must still comply with anti-discrimination laws when deciding what positions to eliminate and what people to fire. Let’s look at those laws.
Title VII: Title VII prohibits employment discrimination based on race/color, gender/sex, gender identity, sexual orientation, national origin, and religion. When conducting a RIF, employers must not target employees for termination based on any of these protected characteristics. Here’s an example to illustrate how Title VII applies:
Example: A company decides to downsize its workforce due to financial difficulties. During the RIF process, the company disproportionately terminates employees of a particular race, i.e., Black workers, while retaining most of the white employees. This action would likely violate Title VII, as it involves disparate treatment based on race.
Damages: If an employer violates Title VII, the affected employees may be entitled to remedies such as back pay and reinstatement. Additionally, the court may award punitive damages and attorney’s fees in cases involving intentional discrimination.
The ADEA: The ADEA protects employees aged 40 and older from age-based employment discrimination. When implementing a RIF, employers have specific obligations under the ADEA, including providing employees with a list of ages and positions of the individuals being let go. Let’s explore this requirement:
Example: A company decides to conduct a RIF and terminates several employees who are 40 years of age or older. The ADEA mandates that the company provides those employees with a list specifying the ages and positions of all individuals selected for the RIF. Failing to provide this information would constitute a per se or automatic violation of the ADEA.
Damages: If an employer violates the ADEA, the affected employees may be entitled to remedies such as lost wages, liquidated damages (in cases of willful violations), and attorney’s fees. However, the ADEA does not provide compensatory or punitive damages, unlike Title VII.
The ADA: The ADA prohibits employers from discriminating against qualified individuals with disabilities. Employers must provide reasonable accommodations during a RIF process to ensure equal opportunities for disabled employees. Let’s consider an example:
Example: A company undergoes a RIF and decides to terminate an employee who has a disability. However, the employee had previously requested a reasonable accommodation, which the company failed to provide. This action may violate the ADA, as it involves failure to provide a reasonable accommodation.
Damages: If an employer violates the ADA, the affected employee may be entitled to remedies such as back pay, front pay (future wages), and reasonable accommodation costs. Additionally, the court may award compensatory damages, punitive damages (in cases of intentional discrimination), and attorney’s fees.
Navigating reductions in force can be complex, but understanding the legal obligations under Title VII, ADEA, and ADA is essential for employers and employees alike.
A recent case decided by the Eleventh District Court of Appeals provides another example. In Bowens v. Escambia County Board Of Education, No. 22-11560, 2023 WL 4145424, (11th Cir. June 23, 2023), Aubrina Bowens, a Black woman, was hired by the Escambia County Board of Education as a non-tenured, probationary teacher assigned to its Alternative Programs for teaching students outside of the regular school setting. After being in that position for two years, the Board was confronted with funding issues for the Alternative Programs and made a financial decision to not renew the non-tenured Alternative Programs teachers’ contracts. The non-renewed teachers included Bowens, Ashley Knowles (a white female), Farrah McGill (a white female), and Terrence Hall (a black male). Additionally, the Board removed two tenured teachers from the Alternative Programs: Yolanda Walters (a black female) was moved to a high school teaching job, while Kellie Steele (a white female) opted to resign.
Bowens eventually conceded that she could not prove that she was treated less favorably than white employees but argued that she was replaced by someone outside her protected class and that the reason for firing her – funding concerns – were pretext (a legal term for false).
Unfortunately for Bowens, the Eleventh District Court of Appeals disagreed with her, holding:
Once Defendants identified a legitimate, nondiscriminatory reason for the employment decision, the burden shifted back to Plaintiff to demonstrate “that the reasons given by the employer were not the real reasons for the adverse employment decision.” See Chapman v. AI Transp., 229 F.3d 1012, 1024 (11th Cir. 2000) (en banc). When — as in this case — the employer’s “proffered reason is one that might motivate a reasonable employer, an employee must meet that reason head on and rebut it, and the employee cannot succeed by simply quarreling with the wisdom of that reason.” See id. at 1030. To satisfy her burden of showing pretext, the employee must demonstrate “‘weaknesses, implausibilities, inconsistencies, incoherencies, or contradictions’ in the employer’s rationale.” See Holland v. Gee, 677 F.3d 1047, 1055-56 (11th Cir. 2012). Plaintiff has failed to do so. … Undisputed evidence demonstrates that — when Defendants made the complained-of employment decision (non-renewal) in May 2018 — Defendants had no guaranteed source of funding to continue operating all three Alternative Programs the following school year. Defendants presented evidence that the mental healthcare provider that had partnered with the Board in running the COMPASS program in the past had expressed doubt about its continued involvement for the 2018-19 school year. Absent that relationship, the Board would have been unable to secure funding for the COMPASS program. Meanwhile, the Alternative School was funded largely by local (not state) funds in amounts that varied from year to year. …On this record, Plaintiff’s evidence failed to show that Defendants’ proffered reason was so implausible, inconsistent, or incoherent that a reasonable factfinder could infer that the reason was not the true reason and was, instead, a pretext for unlawful discrimination.
Id. at *3.
Given that more white employees lost or left their positions than Black employees, combined with the very real economic concerns about losing funding, this was a difficult case from the beginning.
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How do I know if I was wrongfully fired as part of a RIF?
Employment discrimination law are confusing and complex to begin with. Figuring our whether you were wrongfully fired as part of a reduction in force is even more complicated. That’s why your best option is to call the right attorney to schedule a free and confidential consultation. (Read: What is the Spitz No Fee Guarantee?). Call our top employment lawyers in Ohio, Michigan, North Carolina, and Kentucky to get help now. Spitz, The Employee’s Law Firm and its experienced attorneys are dedicated to protecting employees’ rights and solving employment disputes.
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Disclaimer:
This article provides a general overview of reductions in force, race, gender, national origin, disability, LGBTQ+, age and disability discrimination. The wrongful termination information is not intended as legal advice. For specific legal guidance, consult with a qualified attorney familiar with employment law in your jurisdiction. Use and access to this employment law website or any of the links contained within the site do not create an attorney-client relationship. The legal opinions expressed at or through this site are the opinions of the individual lawyer and may not reflect the opinions of The Spitz Law Firm, Brian Spitz, or any individual attorney.