EEOC Proposes to Amend ADEA Disparate Impact Rules

The Equal Employment Opportunity Commission has issued a notice of proposed rulemaking to change its current regulations on disparate impact under the Age Discrimination in Employment Act. The EEOC rule currently prohibits employment practices that have a disparate impact on older individuals unless it is justified as a business necessity. A 2005 U.S. Supreme Court ruling in Smith v. City of Jackson held that the “reasonable factors other than age” (RFOA) test, rather than the business necessity test, is the appropriate standard for determining the lawfulness of an employment practice that disproportionately affects older workers. The Commission proposes to revise it rules to state that when the RFOA exception is raised, the employer has the burden of showing that a reasonable factor other than ages exists factually.