An international law firm with its primary office in New York City, allegedly violated federal age discrimination law through its compensation system, the U.S. Equal Employment Opportunity Commission (EEOC) charged in a recent lawsuit.
According to the EEOC’s suit, in the firms system, attorneys who practiced law after turning 70 years of age received dramatically reduced compensation compared to similarly productive younger attorneys solely because of their age. The EEOC further charged the law firm unlawfully retaliated against one of its attorney’s who practiced law at the firm for over 40 years, by further reducing his compensation after he complained about this discriminatory policy and filed a charge with the EEOC.
“Law firms that single out older attorneys for adverse treatment simply because of their age run great risk of violating the federal prohibition on age discrimination,” said EEOC Acting Chairman Stuart Ishimaru. “This lawsuit should serve as a wake-up call for law firms to examine their own practices to ensure they comport with federal law.”
The EEOC’s lawsuit, Civil Action No. 10- CV-0655, filed in U.S. District Court for the Southern District of New York, said the firm requires all partners to give up their ownership interest in the firm at the age of 70. If an attorney continues to work, his or her compensation consists of an annual "bonus" payment in an amount totally within the discretion of the firm's executive committee.
Since the claimant turned 70 in 2001, even though he previously earned a $1 million plus in fees annually routinely from his clients, his compensation was substantially less than the firm’s younger firm lawyers with similar productivity. Moreover, in 2008 and 2009, after the attorney complained internally about the age-based compensation system, ultimately resulting in his filing of an age discrimination charge with the EEOC, the firm reduced his bonus payment by two-thirds even though his productivity remained the same.
This alleged conduct violates the Age Discrimination in Employment Act (ADEA), prohibiting age-based employment discrimination against workers 40 and older. ADEA also bars employers from retaliating against those who complain about these unlawful practices. The EEOC filed suit only after attempting to reach a voluntary pre-litigation settlement.
“A law firm's compensation for its attorneys should be based on ability and productivity, not on age-based stereotypes about declining effectiveness,” said Elizabeth Grossman, regional attorney in the EEOC's New York office.
Spencer Lewis, Jr., director of the EEOC’s New York District Office, added, “More and more attorneys are effectively practicing law into their 70s and beyond. This is also seen by the fact that most current Justices on the U.S. Supreme Court are over 70 years old.” (workersxzcompxzkit)
In FY 2009, the EEOC received 22,778 age discrimination charge filings, the second highest level ever, accounting for 24% of its private sector caseload.
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