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Friday, April 13, 2012

Mandatory Retirement Policy Costly



Alabama@Work
By Tommy Eden, Attorney

Attorney Eugene T. D’Ablemont, with the New York law firm of Kelley, Drye & Warren, continued to practice law full-time at the firm after turning 70 in 2000. The law firm has over 300 attorneys and represents clients in high-stakes class action cases. It had a policy that attorneys who wanted to practice after reaching 70 could only do so by giving up all ownership interest in the firm and instead be compensated through discretionary bonuses. This resulted in significant under-compensation for D’Ablemont.

In a case of great significance to the legal community, the firm, after being sued in Federal District Court for the Southern District of New York for violating the Age Discrimination in Employment Act (ADEA), agreed in a consent decree to end its policy of requiring partners to give up their equity in the firm once they reach 70. D’Ablemont, who continues to practice at the firm, will be paid $574,000.

The three year consent decree entered by the Federal Magistrate on April 3rd requires the following by the law firm: 1) amended Partnership Agreement to eliminate the provision that required that a partner relinquish their equity interest in the firm at age 70; 2) permanently enjoined from involuntary termination, expulsion, retirement or reduction of the compensation because of age; 3) provide each partner with a copy of the decree and post it in its offices; 4) provide two hours of EEO training with videotaped and attendance records; 5) D’Ablemont, now over age 80, is to continue to receive compensation for legal work performed; 6) maintain records of all written or oral complaints of alleging age discrimination and to make a written report to the EEOC; and 7) the court retains jurisdiction to enforce provisions of the consent decree.

Common Sense Counsel: there is no reason why attorneys, or anyone else, who is capable of continuing to work at 70 should be forced to retire from their chosen profession just because of their age, unless there are reasonable factors other than age. On March 29th the EEOC released its Final Rule on "Reasonable Factors Other than Age" Under the ADEA. The final rule clarifies that the ADEA prohibits policies and practices that have the effect of harming older individuals more than younger individuals, unless the employer can show that the policy or practice is based on a reasonable factor other than age. The rule applies to private employers with 20 or more employees, state and local government employers, employment agencies, and labor organizations. Know the rules before you make a costly policy.

Tommy Eden is a Lee County Native, an attorney with the local office of Capell & Howard, P.C. and a member of the ABA Section of Labor and Employment Law and serves on the Board of Directors for the East Alabama SHRM Chapter. He can be contacted at tme@chlaw.com or 334-501-1540 or www.AlabamaAtWork.com. Alabama Immigration updates at www.immigrationalabamalaw.com.