Supreme Court To Decide Lawfulness of Rehire Restrictions for Drug Users
and Age-Based Cutoff of Retiree Health Benefits
December 2003
Two cases currently before the Supreme Court
address the lawfulness of rehire restrictions for drug users and age-based cutoff
of retiree health benefits.
by Paul
J. Siegel, Esq.
Jackson Lewis
LLP
In several cases pending before the U.S. Supreme Court this term, the justices
will consider the lawfulness of employer policies under major federal antidiscrimination
laws. At issue are provisions of the Americans With Disabilities Act (ADA) as
applied to a blanket policy banning the rehire of a former drug user, and allegations
of reverse discrimination under the Age Discrimination in Employment Act.
Are "No-Rehire" Policies Lawful under the ADA?
In Hernandez v Hughes Missile Systems Company,
the U.S. Supreme Court will decide whether the ADA precludes an employer from
refusing to rehire an employee for illegal drug use. In this case, Joel Hernandez
worked for the company for 25 years. After testing positive for cocaine, he
chose to quit in lieu of termination. When Mr. Hernandez reapplied to the company
and provided information he was no longer abusing drugs or alcohol, the company
allegedly failed to rehire him based on his past drug use.
Mr. Hernandez sued, claiming the company violated the ADA by refusing to
rehire him based on his drug addiction and "regarding" him as disabled. The
trial court granted summary judgment for the company, and the Ninth Circuit
Court of Appeals reversed.
The Ninth Circuit found the company could not rely on a blanket policy of
not rehiring employees who resigned in lieu of termination. As the court stated,
"[the policy] although not unlawful on its face, violates the ADA as applied
to former drug addicts whose only work-related offense was testing positive
because of their addiction."
Is "Reverse" Age Discrimination Actionable under the ADEA?
In Cline v General Dynamics Land Systems, Inc.,
the U.S. Supreme Court will decide whether the Age Discrimination in Employment
Act (ADEA) prohibits "reverse" discrimination. Dennis Cline had worked for the
company for 34 years and intended to retire in the near future. Under a new
labor agreement with the United Auto Workers (UAW), the company contracted to
provide healthcare benefits only to retirees who had accumulated 30 years of
seniority and who were more than 50 years old by July 1, 1997. Mr. Cline was
only 48 years old by the deadline, and therefore excluded permanently from health
benefits after retirement.
Mr. Cline and other employees between the ages of 40 and 49 sued under the
ADEA, claiming the company could not lawfully treat older employees more favorably
simply on the basis of age. The Sixth Circuit Court of Appeals agreed, holding
that a reverse discrimination claim is actionable under the ADEA. This decision
was in marked contrast to other circuits, which have held an employee cannot
successfully sue for reverse discrimination under the ADEA.
The court heard oral arguments in the Hughes Missile
Systems case on October 8, 2003, and in the General Dynamics Land Systems
case on November 12, 2003. Both cases have the potential significantly to expand
the liability risk for employers should the decisions go against the corporations.
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