Home » Commentary » Can an Employee Legally Be Terminated Because of Their Age? In Rare Circumstances, Yes.

Amanda DeMatteis: Hi, Josh.

Josh Goodbaum: Hi, Amanda, what are we talking about today?

DeMatteis: I thought we would talk about age discrimination. We’ve talked about it before, and the basic information that we have provided to viewers is, if you are over the age of 40 and your employer takes some type of adverse employment action against you, and it’s even in part motivated by your age, that’s actionable.

But is there anyone that can be terminated because of their age and not have a case against their employer?

Goodbaum: Yeah, Amanda, there is. This is really counterintuitive. It doesn’t come up much. It’s not litigated often. I’ve only seen a handful of cases about it in my career. But it’s still worth knowing about, so I want to tell the folks at home about it.

There are two relevant laws that cover age discrimination. There’s the Age Discrimination in Employment Act (that’s the federal law) and for folks in Connecticut, there’s the Connecticut Fair Employment Practices Act (that’s the state level law). Many other states around the country are gonna have their own laws.

Both the ADEA (the federal law) and the CFEPA (our CT state law) have a carve out for senior executives if they qualify for a retirement plan of a certain amount. I want to break that down. The ADEA and the CFEPA, in this regard, are almost entirely the same, but there is one minor difference between them that might make be important for certain employees.

In order to qualify for this carveout from our age discrimination laws, the employee first must be 65 or older. Next, the employee must, for the previous two years, have been a bona fide executive or worked in a high policymaking position. What does that mean? They’ve got to be really senior. There should be just a very few people within a company who qualify for this exemption. And third, they have to be entitled to an annual retirement benefit of at least $44,000 per year. The retirement benefit must be immediately available to the employee, and it must not be forfeitable for any reason. So, if the employee sues for something else, they don’t forfeit their retirement benefit. If the employee competes with their employer, they don’t forfeit their retirement benefit. They are entitled to this $44,000 for the rest of their life.

Now, I said there is one potential difference between these two laws in this area. The ADEA seems to be concerned only with compulsory retirement programs. In other words, this exemption arguably only applies where the employer forces everybody in this position over the age of 65 to retire. In contrast, our Connecticut law seems to exempt all terminations of people over the age of 65 who are these senior executives who have this particular retirement benefit.

So, if you are a very senior executive and you’ve been subjected to age discrimination and you have a non-forfeitable retirement plan of at least $44,000 a year, this is something to consider when you’re thinking about whether you can make a claim for age discrimination against your employer.

DeMatteis: Thank you so much, Josh. Really valuable to know. Thank you for watching and we’ll see you next time.

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