Four-and-a-quarter million dollars. That is what a federal jury recently awarded an ongoing employee at Abbott Laboratories for her age discrimination and retaliation claims. What caused the jury to award such a large amount in damages? Here is a look at the facts, followed by tips on how to avoid such liability when dealing with older employees.
All Seems Fine—Until Employee Hits Her Fifties
Luz Gonzalez-Bermudez (Gonzalez) has worked for Abbott since 1984, beginning her career as a pharmaceutical representative followed by promotions that ultimately made her the HCP national sales manager. In that role, Gonzalez was classified in Abbott’s compensation system as a Level 18 position, warranting a six-figure salary, an annual incentive bonus, stock options, and a company car.
But, eighteen months after her promotion to the HCP national sales manager, when Gonzalez was about 51 years old, her position was eliminated and she was demoted to a marketing manager position. Her new job was a Level 17 position, but Abbott allowed her to keep her Level 18 compensation and benefits for up to two years.
In the marketing manager position, Gonzalez reported to Kim Perez, the Director of Marketing (and later, the General Manager). Perez evaluated Gonzalez’s performance as a marketing manager negatively. Gonzalez complained internally that Perez was creating a hostile work environment, due to repeatedly asking her about outstanding work, sending a lot of emails following up on pending matters, and a lack of communication about things Gonzalez needed to know to do her job.
When Gonzalez’s two years of Level 18 compensation was up, Perez and the Human Resources Director told her that she had been assigned a Product Manager position, which was a Level 15 classification. At that level, Gonzalez took a pay cut, lowered bonus, loss of stock options, and lowered company car benefits.
Employee Lawyers Up
About six months later, Gonzalez’s attorneys sent a letter on her behalf to Perez and others at Abbott, notifying them that they had been retained to represent her in any age discrimination claims that Gonzalez may have against them. Despite the letter, Abbott did not conduct an investigation into any possible claims. Shortly thereafter, Gonzalez filed an administrative charge with the Antidiscrimination Unit of the Puerto Rico Department of Labor and Human Resources alleging age discrimination and retaliation.
Over the next few months, Gonzalez applied for two different positions for which she was qualified that were at higher pay levels than her current Level 15 job. She was interviewed for one of the positions but Abbott instead hired an outside candidate who was 31 years old. Gonzalez was not even considered for the second position which was filled by a 41-year-old internal candidate. Gonzalez filed a charge with the Equal Employment Opportunity Commission (EEOC) alleging retaliation. Gonzalez continued to work for Abbott while pursuing her age discrimination and retaliation claims in federal court.
Jury Finds Discrimination and Retaliation Occurred
After a seven-day trial, a unanimous jury found in favor of Gonzalez on all of her claims. The jury awarded her $250,000 in back pay and $4,000,000 in compensatory damages as a result of age discrimination and/or retaliation.
How To Avoid Age Discrimination Claims
While it is tough to know which facts and witnesses swayed the jury to award such a large verdict, there are some precautions that employers may take to help avoid having to defend against an age discrimination claim in front of a jury. Here are steps to consider:
- Follow your policies. Abbott failed to follow its own policies regarding giving preference to internal candidates for job openings which allowed Gonzalez to argue that something sinister was behind why she didn’t get promoted to higher level jobs.
- Carefully document your hiring, transfer, and demotion decisions. Providing evidence of a legitimate business reason for your employment actions will go a long way in dispelling a claim that you acted with discriminatory intent.
- Research and investigate complaints immediately. Abbott failed to investigate Gonzalez’s early reports of age discrimination, even after she had her lawyers send a letter on her behalf.
- Remember that you do not have to fire an employee to be subject to a discrimination or retaliation claim. As Abbott found out, decisions such as reassigning an older worker to a less responsible/lower paid position, or failing to interview the long-time employee for job openings for which she is qualified can be sufficiently adverse to support significant liability.
As with other types of discrimination claims, treat complaints of age-related bias seriously. Be proactive about preventing retaliation against employees who complain or assist in an investigation. And look to resolve age discrimination in your workplace without having to go to court. Doing so may just help you avoid a multi-million dollar verdict.
