4th Circuit rules that Baltimore Co. owes employees back pay for higher pension rates

Baltimore County owes more than a decade of back pay to older employees who contributed to the county pension plan at a higher rate, a federal appeals court ruled Wednesday.

The county has been in litigation with the Equal Employment Opportunity Commission for years over the higher contribution rates for employees 40 and older. The EEOC first issued notices of charges of age discrimination in 1999 and 2000 but did not pursue the case until 2006, when it issued a letter determining discrimination occurred and filed suit the following year.

A U.S. District Judge granted partial summary judgment on liability in 2012, which the 4th U.S. Circuit Court of Appeals affirmed in 2014.

The parties and unions involved approved a plan for gradual equalization of contribution rates in 2016, but the EEOC pursued retroactive and prospective damages for the unequal rates paid until they were equalized. A federal judge denied that request in 2016, and the EEOC appealed.

The 4th Circuit held in a published per curium opinion Wednesday that the Age Discrimination in Employment Act requires mandatory back pay upon a finding of liability because the law incorporates the remedy provisions of the Fair Labor Standards Act.

“Because Congress adopted the enforcement procedures and remedies of the FLSA into the ADEA, we construe the ADEA consistent with the cited statutory language in and judicial interpretations of the FLSA,” the three-judge panel concluded. “Back pay is, and was at the time Congress passed the ADEA, a mandatory legal remedy under the FLSA.”

A spokesperson for the EEOC declined to comment Wednesday.

The county began a three-year plan to phase in an age-neutral contribution rate on July 1, 2016, pursuant to the consent decree.

An attorney for the county estimated the requested back pay would cost the county $19 million in 2016 court filings, but the EEOC told the appeals court it would not pursue an award for the years between the initial notice of charges in 1999 and 2000 and the letter of determination in 2006, acknowledging the delay was unreasonable.

The appellate panel determined the delay did not change their conclusion interpreting the statute but the EEOC’s decision not to seek monetary relief for excessive deductions before 2006 meant the court did not need to reach the issue of laches, which was raised by the county.

A spokeswoman for Baltimore County said County Executive Don Mohler has asked the county attorney to review the decision and determine the next steps. No updated liability estimate was available.

The case has been remanded to U.S. District Court for a determination of the amount of back pay owed.

The case is Equal Employment Opportunity Commission v. Baltimore County et al., No. 16-2216.

 

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