[Federal Register Volume 72, Number 129 (Friday, July 6, 2007)]
[Rules and Regulations]
[Pages 36873-36875]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E7-13051]


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EQUAL EMPLOYMENT OPPORTUNITY COMMISSION

29 CFR Part 1625

RIN 3046-AA78


Coverage Under the Age Discrimination in Employment Act

AGENCY: Equal Employment Opportunity Commission.

ACTION: Final rule.

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SUMMARY: The Equal Employment Opportunity Commission (``EEOC'' or 
``Commission'') is publishing this final rule to amend its Age 
Discrimination in Employment Act (the ``Act'' or ``ADEA'') regulations 
to conform them to the Supreme Court's holding in General Dynamics Land 
System, Inc. v. Cline, 540 U.S. 581 (2004), that the ADEA only 
prohibits discrimination based on relatively older age, not 
discrimination based on age generally. Thus, the final rule deletes 
language in EEOC's ADEA regulations that prohibited discrimination 
against relatively younger individuals. The new rule explains that the 
ADEA only prohibits employment discrimination based on old age and, 
therefore, does not prohibit employers from favoring relatively older 
individuals.

DATES: Effective date July 6, 2007.

FOR FURTHER INFORMATION CONTACT: Raymond Peeler, Senior Attorney 
Advisor, Office of Legal Counsel, at (202) 663-4537 (voice) or (202) 
663-7026 (TTY) (These are not toll free numbers). This final rule also 
is available in the following formats: large print, braille, audio tape 
and electronic file on computer disk. Requests for this final rule in 
an alternative format should be made to the Publications Information 
Center at 1-800-669-3362.

SUPPLEMENTARY INFORMATION: On August 11, 2006, the EEOC published a 
Notice of Proposed Rulemaking (``NPRM'') in the Federal Register to 
amend regulations that prohibited any age-based discrimination against 
individuals forty years old or older, regardless of whether the age-
bias favored older or younger individuals.\1\ Relying on the Supreme 
Court's decision in General Dynamics Land System, Inc. v. Cline, 540 
U.S. 581 (2004),\2\ the NPRM explained that the ADEA protects only 
relatively older individuals.
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    \1\ EEOC Notice of Proposed Rulemaking, 71 FR 46177, Aug. 11, 
2006.
    \2\ In Cline, a group of employees between the ages of forty and 
forty-nine sued their employer for age discrimination when it 
eliminated its future obligation to pay retiree health benefits for 
any employee then under fifty years old. The Supreme Court rejected 
their claim, finding that the ADEA's prohibition against 
discrimination ``because of age'' only prevents discrimination that 
favors younger workers, not actions that place older workers in a 
more favorable position. The Court's rationale is described in 
detail in the NPRM. See 71 FR at 46178.
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Overview of Public Comments

    The Commission received nine public comments during the public 
comment period, which ended on October 10, 2006. Six commenters 
strongly supported the proposed rule: AARP, National Employment Lawyers 
Association (NELA), Equal Employment Advisory Counsel (EEAC), U.S. 
Chamber of Commerce, TOC Management Services, and the National 
Federation of Independent Business (NFIB). Two federal employee unions 
opposed the rule. The Conference

[[Page 36874]]

Board, a ``business research and membership non-profit organization'' 
whose comment is a compilation of questions from its members, sought 
some clarifications that are discussed below.

Scope of the Regulation

    One of the opposing commenters argued that the Supreme Court's 
ruling in Cline was already reflected in Section 1625.2(b) of the 
Commission's current regulations, which allows favorable treatment of 
older workers with respect to benefits. We believe that the Supreme 
Court addressed this comment through its detailed analysis concerning 
the purpose of the ADEA as protecting older workers and its 
characterization of the current regulations' prohibition of ``reverse'' 
age discrimination as ``clearly wrong.'' \3\ Thus, the Commission 
concludes that it cannot conform its regulations to the Court's 
decision in Cline without amendment.
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    \3\ Cline, 540 U.S. at 600.
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    A Conference Board member's comment that ``the change in language 
creates a slippery slope around creating new protections,'' suggests a 
belief that the rule creates a new enforceable right for older 
individuals. The rule creates no such right. It simply provides that an 
employer does not violate the ADEA if it makes an age-based decision 
that favors older individuals.\4\ The Commission has added language to 
section 1625.2 to clarify this point.
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    \4\ In Cline, the employer eliminated retiree health benefits, 
but grandfathered employees who were age 50 or older.
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    The opposing comments and some comments from the Conference Board 
construe the NPRM to inappropriately encourage favoritism of older 
individuals. For example, the American Federation of Government 
Employees (AFGE) argued that the NPRM inappropriately deters the 
employment of younger individuals in the protected age group, and a 
Conference Board member expressed concern that certain positions will 
become ``for matures only.'' However, as the Cline Court noted:

    The [legislative and administrative] record is devoid of any 
evidence that younger workers were suffering at the expense of their 
elders * * * Common experience is to the contrary * * * If Congress 
had been worrying about protecting the younger against the older, it 
would not likely have ignored everyone under 40. The youthful 
deficiencies of inexperience and unsteadiness invite stereotypical 
and discriminatory thinking about those a lot younger than 40, and 
prejudice suffered by a 40-year-old is not typically owing to youth, 
as 40-year-olds sadly tend to find out. The enemy of 40 is 30, not 
50.\5\
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    \5\ Cline, 540 U.S. at 591.

    AFGE also asked EEOC to restrict the regulation's scope by 
explaining that it does not affect state laws prohibiting age 
discrimination against relatively younger persons. The same concern was 
reflected in a question from the Conference Board. The Commission 
agrees with this suggestion; the rule only interprets the ADEA, not 
state or local law. The ADEA permits states to provide protections in 
addition to those provided by federal law.\6\ Thus, the Commission has 
revised the final rule to clarify that it only interprets the ADEA, not 
state or local law.
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    \6\ ``Nothing in this [statute] shall affect the jurisdiction of 
any agency of any state performing like functions with regard to 
discriminatory employment practices on account of age except that 
upon commencement of action under [the ADEA] such action shall 
supersede any state action.'' 29 U.S.C. 633(a).
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Concerns With Specific Provisions

    Some members of the Conference Board asked for additional guidance 
in Section 1625.4 regarding how employers may structure advertisements 
without violating the ADEA. AFGE also criticized this Section, 
suggesting that we only provide examples such as ``experience a plus.'' 
But AARP, whose comment also was adopted by NELA, praised the NPRM's 
``straightforward description of what is acceptable in posting 
employment advertisements.'' The NFIB and EEAC also supported the 
advertisement language, believing it would aid their members' 
recruitment efforts. Inasmuch as the advertising provisions are 
expressly supported by many commenters and already include several 
examples that EEOC believes reflect the Court's interpretation of the 
ADEA, the EEOC concludes that further guidance in the text of the 
regulation is unnecessary. Further, providing a definitive list of 
legally acceptable advertising language could hamper employers' unique 
efforts to fill their workforce needs.
    AFGE also commented that the revised Sec.  1625.5 improperly 
encourages employers to collect an applicant's age or date of birth. 
The Commission does not agree that this Section encourages employers to 
collect such information. To the contrary, it warns employers that the 
EEOC will closely scrutinize the collection of age-identifying 
information to ensure that it is collected and used only for lawful 
purposes. AARP and NELA (adopting AARP's comment), both worker rights 
groups, explicitly approved of how this provision ``emphasizes the role 
of the EEOC in monitoring employment applications.''

Revisions to the NPRM

    The final rule adopts the NPRM but adds a sentence to clarify that 
it neither creates an enforceable right for older workers nor affects 
state or local prohibitions against age-based favoritism.

Regulatory Planning and Review

    This final rule is considered to be a ``significant regulatory 
action'' pursuant to section 3(f)(4) of Executive Order 12866, 58 FR 
51735 (Sept. 30, 1993), in that it arises out of the Commission's legal 
mandate to enforce the ADEA. Therefore, it was circulated to the Office 
of Management and Budget for review. Nonetheless, the Commission has 
determined that this rule will not have an annual effect on the economy 
of $100 million or more, and will not adversely affect the economy, a 
sector of the economy, productivity, competition, jobs, the 
environment, public health or safety. To the contrary, this final rule 
increases the flexibility of employers to take previously forbidden 
age-based actions that favor older workers.
    Although the final rule applies to all employers with at least 20 
employees,\7\ it will not have a significant impact on small business 
entities under the Regulatory Flexibility Act, because it imposes no 
economic or reporting burdens. For reasons already identified, the 
Commission also finds that this final rule requires no additional 
scrutiny under either the Paperwork Reduction Act, 44 U.S.C. 3501, et 
seq., concerning the collection of information, or the Unfunded 
Mandates Reform Act of 1995, 2 U.S.C. 1501, et seq., concerning the 
burden imposed on state, local, or tribal governments.
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    \7\ See 29 U.S.C. 630(b). According to Census Bureau 
Information, approximately 1,976,216 establishments employed 20 or 
more employees in 2000, see Census Bureau, U.S. Department of 
Commerce, Statistics of U.S. Businesses (2000).
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List of Subjects for 29 CFR Part 1625

    Advertising, Aged, Employee benefit plans, Equal employment 
opportunity, Retirement.

    Dated: June 29, 2007.

    For the Commission.
Naomi C. Earp,
Chair.

0
For the reasons discussed in the preamble, the Equal Employment 
Opportunity Commission amends 29 CFR chapter XIV part 1625 as follows:

[[Page 36875]]

PART 1625--AGE DISCRIMINATION IN EMPLOYMENT ACT

0
1. Revise the authority citation for part 1625 to read as follows:

    Authority: 29 U.S.C. 621-634; 5 U.S.C. 301; sec. 2, Reorg. Plan 
No. 1 of 1978, 43 FR 19807; E.O. 12067, 43 FR 28967.

Subpart A--Interpretations

0
2. Revise Sec.  1625.2 to read as follows:


Sec.  1625.2  Discrimination prohibited by the Act.

    It is unlawful for an employer to discriminate against an 
individual in any aspect of employment because that individual is 40 
years old or older, unless one of the statutory exceptions applies. 
Favoring an older individual over a younger individual because of age 
is not unlawful discrimination under the ADEA, even if the younger 
individual is at least 40 years old. However, the ADEA does not require 
employers to prefer older individuals and does not affect applicable 
state, municipal, or local laws that prohibit such preferences.
0
3. Revise Sec.  1625.4 to read as follows:


Sec.  1625.4  Help wanted notices or advertisements.

    (a) Help wanted notices or advertisements may not contain terms and 
phrases that limit or deter the employment of older individuals. 
Notices or advertisements that contain terms such as age 25 to 35, 
young, college student, recent college graduate, boy, girl, or others 
of a similar nature violate the Act unless one of the statutory 
exceptions applies. Employers may post help wanted notices or 
advertisements expressing a preference for older individuals with terms 
such as over age 60, retirees, or supplement your pension.
    (b) Help wanted notices or advertisements that ask applicants to 
disclose or state their age do not, in themselves, violate the Act. But 
because asking applicants to state their age may tend to deter older 
individuals from applying, or otherwise indicate discrimination against 
older individuals, employment notices or advertisements that include 
such requests will be closely scrutinized to assure that the requests 
were made for a lawful purpose.

0
4. Revise the first paragraph of Sec.  1625.5 to read as follows:


Sec.  1625.5  Employment applications.

    A request on the part of an employer for information such as Date 
of Birth or age on an employment application form is not, in itself, a 
violation of the Act. But because the request that an applicant state 
his age may tend to deter older applicants or otherwise indicate 
discrimination against older individuals, employment application forms 
that request such information will be closely scrutinized to assure 
that the request is for a permissible purpose and not for purposes 
proscribed by the Act. That the purpose is not one proscribed by the 
statute should be made known to the applicant by a reference on the 
application form to the statutory prohibition in language to the 
following effect:
* * * * *
[FR Doc. E7-13051 Filed 7-5-07; 8:45 am]
BILLING CODE 6570-01-P