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A new enforcement guidance from the Equal Opportunity Commission analyzes benefit discrimination claims under the Age Discrimination in Employment Act (ADEA), the ADA, Title VII and the Equal Pay Act. Issued October 3, 2000 this 70-page chapter of the agency's Compliance Manual covers the legal standards that apply to discrimination claims in health and life insurance, long- and short-term disability benefits, severance benefits, pension or other retirement benefits and early retirement incentives.
In the section on the ADEA, the guidance explains the agency's "equal cost/equal benefit" rule: employers are permitted to provide lower life, health and disability benefits to older workers if the employers pay an equal amount for those benefits for the older and younger employees. In other words, employers have a choice: they may either "provide equal benefits to their older and younger workers or spend an equal cost to purchase those benefits, even if the benefits are not equal."
Concerning the ADA, employers are prohibited from making disability-based distinctions in employee benefits unless it can be shown that such distinctions are justified and are not in place as a means of evading the purposes of the ADA. The guidance defines a disability-based distinction as singling out for different treatement a particular disability, a discrete group of disabilities or disability in general. For example, a cap on health insurance benefits an employer will pay for AIDS is a disability-based distinction.
The complete guidance, as well as questions and answers on employee benefits, may be found on the EEOC's Website: http://www.eeoc.gov.
For more information on discrimination or any of Krukowski & Costello's services, please call (414) 423-1330 or email educational services.
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