United States: Tennessee District Court Conditionally Certifies ADEA Collective Action

Connecting the dots will likely be a problem down the road . . .

The overwhelming majority of employment class or collective actions today are wage and hour matters. The two-step paradigm for certifying wage and hour claims under the Fair Labor Standards Act has, despite Congressional intent to the contrary, enabled much of that boom in overtime litigation.

The Age Discrimination in Employment Act expressly incorporates much of the FLSA's enforcement procedure, including the section 16(b) requirement that similarly situated claimants actually opt in. Indeed, one of the most commonly cited early decisions supporting the procedure, the Lusardi opinion (118 F.R.D. 463 (D.N.J. 1987)), was actually in an ADEA case. Incidentally, the same procedure applies under the Equal Pay Act, although such claims are far less common than those for overtime. But while the ADEA uses FLSA procedures, collective actions under that statute are still much less common than those under the FLSA.

A district court in Tennessee has just conditionally certified such a case, but the fact pattern is a little unusual and raises questions about the viability of the claimed collective class going forward.  In

Manlove v. Volkswagen Aktiengesellschaft, Case No. 1:18-cv-145 (E.D. Tenn., June 11, 2019), the plaintiff brought a putative collective action against Volkswagen under the ADEA. The crux of his claim was the contention that the company discriminated against workers over the age of 50 throughout the United States. He sought equitable relief under the ADEA, reserving the question of damages to later proceedings, and moved for conditional certification.

To support certification, the plaintiff relied on certain policies announced in Germany (more about that in a minute) and anecdotal evidence from 4 employees from the company's newer plant (and that location only), in Chattanooga Tennessee. The anecdotal accounts are less than compelling. One complained of a workforce restructuring that affected both older and younger workers. Another was terminated for violation of company policy (the opinion does not say whether it was warranted or not) and replacement by a younger employee. Another was given a promotion to an interim position, but complained that it did not involve an immediate pay increase. This employee had the strongest evidence, a claim that he was told he was "too old" for a management training program. That same individual, however, was terminated six months later for violating the company's bid process, but the opinion again does not disclose whether the termination was justified or not. Yet another of the four complained of having to train younger employees who were later promoted, but he was terminated shortly afterwards for failing a random drug test. Many of these decisions were made by different sets of supervisors at different times.

The opinion does not address whether any of the exemplars were actually the best qualified for the positions they sought or the reasons the employer either stated or had for any of the decisions that affected them. Apart from the four examples, there was no analysis of how older workers fared at the plant, the percentage of older workers in various positions, or similar evidence. Thus, the notion of a class was dependent upon the experience of 4 out of the approximately 2,000 people working at the plant.

To tie these garden-variety claims together, the plaintiffs rested heavily on a nest of facts originating in Germany. In late 2016, the company announced a global program called "Pact for the Future" to eliminate approximately 30,000 jobs, the vast majority of which would be in Germany or South America. The opinion does not say whether any were in the relatively new Chattanooga plant or, for that matter, anywhere else in three dozen or more Volkswagen facilities in the United States. Some six months later, the German parent issued a press release proclaiming that "[w]e are becoming slimmer, leaner and younger" and announcing changes in programs affecting "junior managers." The European Union has upheld mandatory retirement requirements for its member nations and the permissible age for mandatory retirement in Germany is currently 65 and 7 months (scheduled to increase to 67 by 2029). The court apparently tied decisions that were lawful where they were made, Germany, by noting that two of the decisionmakers in Chattanooga had come from German Volkswagen plants. The opinion does not explain how the fact that they were 2 of nearly 300,000 German employees means that may have had some age animus.

The court ultimately held that these allegations were enough for conditional certification of a class of employees over the age of 50. Splitting the baby, however, the court noted that the four exemplars were all from the Chattanooga plant, and refused conditional certification for the other thirty five or more locations in the United States.

So what are the takeaways? First, the case is a reminder that class action age claims, at least those under federal law, are governed, rightly or wrongly, by the FLSA's collective action process. Second, in this instance the court permitted conditional certification on some pretty shaky grounds. Sure, these 4 individuals might or might not get past summary judgment, but the connection to a layoff initiative in other countries was tenuous at best. Moreover, although the case purported to seek primarily injunctive relief, there was no evidence that the layoff program lasted beyond the summer of 2017, nearly two years before the decision was issued. These issues will likely become even worse as the case progresses, as the court, will ultimately need to sort out countless allegations regarding hiring, training, transfer, promotion, and discharge on an individual basis, a process the Supreme Court rejected in Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338 (2011).

The bottom line: ADEA cases are governed by the FLSA's enforcement procedure, but the use of an overly light standard for conditional certification will only create a thicket of issues that will need to be resolved individually, resulting in case management issues and likely decertification.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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