Summary judgment for Lake County affirmed in age discrimination case

A group of retired Lake County employees who were fired from part-time, at-will work in order to preserve the county’s financial and health insurance situation cannot succeed on their age discrimination claim against the county because the employees’ age was not the predicate factor in their firing, the 7th Circuit Court of Appeals has ruled.

In the midst of the decline in Lake County’s emergency cash and self-insurance fund in the late 2000s and early 2010s, the county offered retirement incentives to employees who were at least 65 years old. The incentive package offered five years of supplemental health insurance through Aetna and also allowed those who took the incentive to continue to work at-will on a part-time basis.

Many employees chose to take the incentive package, but Aetna informed the county in 2013 that if retirees who were rehired as part-time employees remained on the plan, it would no longer qualify for special federal exemptions and insurance costs would shoot up. Based on that information, the county was forced to inform 28 of the rehired retirees that their employment would end on Oct. 1, 2013.

Each of the 28 fired employees met four criteria: they had retired and been rehired for part-time work, were at least 65 years old, received Medicare as their primary insurance and were enrolled in the Aetna supplemental policy. However, a larger group of county employees over the age of 65 who were not enrolled in the Aetna supplement continued working for the county.

The fired retirees filed an age discrimination suit in the U.S. District Court for the Northern District of Indiana, but the district court granted summary judgment to the county on the basis of insufficient evidence of age discrimination. The 7th Circuit Court of Appeals affirmed that decision Wednesday, with Judge David Hamilton writing the fact that all of the plaintiffs were at least 65 years old was not the impetus for the county’s decision to terminate their employment.

Instead, each of the 28 plaintiffs qualified under the four criteria for termination, the most important of which was their enrollment in the Aetna supplement, Hamilton said. Thus, it was economic and regulatory pressures that led to their termination, not “generalizations about the capabilities of elderly employees,” he said.

“As a thought experiment, consider a scenario in which the ’65 or older’ criterion was eliminated and there was no evidence that any County official took account of the ages of plaintiffs,” Hamilton wrote. “The outcome in this scenario would be unchanged. Exactly the same group or rehired retirees would be terminated.”

The plaintiffs also argued they could prove age discrimination under a theory of disparate impact, but Hamilton wrote such an argument was a poor fit for the instant case because they failed to “’proffer statistical evidence that the policy caused a significant age-based disparity.” Finally, the appellate court rejected the plaintiffs’ Equal Protection Clause argument because they did not identify a suitable comparator group.

“The County’s choice preserved plaintiffs’ eligibility for the supplemental insurance under the Aetna plan,” Hamilton wrote. “That choice was rational; the Constitution requires nothing more.”

The case is Aaron Carson, et al. and Ronald Paulson v. Lake County, Indiana, 16-3665.