March 12, 1993 UNITED STATES COURT OF APPEALS FOR THE FIRST CIRCUIT
No. 92-1696
EQUAL EMPLOYMENT OPPORTUNITY COMMISSION,
Plaintiff, Appellant,
v.
COMMONWEALTH OF MASSACHUSETTS, ET AL.,
Defendants, Appellees.
ERRATA SHEET
Please make the following corrections in the opinion in the above case released on March 4, 1993:
Page 11, 3 lines from bottom:
change "consitutional" to "constitutional"
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change "Massachusetts's" to "Massachusetts'"
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delete "in".
March 4, 1993 UNITED STATES COURT OF APPEALS FOR THE FIRST CIRCUIT
No. 92-1696
EQUAL EMPLOYMENT OPPORTUNITY COMMISSION,
Plaintiff, Appellant,
v.
COMMONWEALTH OF MASSACHUSETTS, ET AL.,
Defendants, Appellees.
APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MASSACHUSETTS
[Hon. Edward F. Harrington, U.S. District Judge]
Before
Breyer, Chief Judge,
Higginbotham,* Senior Circuit Judge,
and Boudin, Circuit Judge.
Lamont N. White, Attorney, with whom Donald R. Livingston,
General Counsel, Gwendolyn Young Reams, Associate General Counsel, and
Vincent J. Blackwood, Assistant General Counsel, were on brief for
appellant Equal Employment Opportunity Commission. Steven S. Zaleznick, Cathy Ventrell-Monsees, and Thomas W.
Osborne on brief for American Association of Retired Persons, amicus
curiae. Pierce O. Cray, Assistant Attorney General, with whom Scott
Harshbarger, Attorney General, was on brief for appellee Commonwealth
of Massachusetts. James H. Quirk, Jr. for appellee The Barnstable County Retirement
Association.
March , 1993
*Of the Third Circuit, sitting by designation.
Higginbotham, Senior Circuit Judge. Massachusetts Higginbotham, Senior Circuit Judge
requires state and local officials and general employees who are
seventy years old or older to take and pass a medical examination
as a condition of continued employment. The issue on this
appeal is whether such a requirement violates the Age
Discrimination in Employment Act (ADEA), 81 Stat. 602, as
amended, 29 U.S.C. 621 et seq. (1990). We hold that it does.
I.
In 1977, Massachusetts enacted Chapter 32 of
Massachusetts General Laws to regulate its retirement systems and
pensions. One component of Chapter 32, Section 90F, requires
Group 1 employees of the Commonwealth and its political
subdivisions who are seventy years of age or older to pass an
annual medical examination as a condition of continued
employment.1
1Section 90F provides in its entirety:
Any member in service classified in Group 1, or any other person who would be classified in Group 1 except for the fact that he is not a member, shall continue in service, at his option, notwithstanding the fact that he has attained age seventy; provided, however, that he is mentally and physically capable of performing the duties of his office or position. Such member or other person shall annually, at his own expense, be examined by an impartial physician designated by the retirement authority to determine such capability. No deductions shall be made from the regular compensation of such member or other person under the provisions of this chapter for
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Group 1 employees are "[o]fficials and general employees
including clerical, administrative and technical workers,
laborers, mechanics and all others not otherwise classified."
Mass. Gen. L. ch. 32, 3(2)(g) (1992). Under the regulations
enacted pursuant to section 90F, no later than 120 days before
the last day of the month when a Group 1 employee will reach the
age of seventy, the retirement board of which he or she is a
member notifies him or her of the retirement benefits to which he
or she would be entitled if he or she retired at the age of
seventy. In order to remain in employment after the age of
seventy, the employee must complete an application and submit to
a medical examination by a physician designated by the board.
Upon receipt of the report of the physician, the retirement board
votes to decide whether to grant the application for permission
to continue in service. If the application is granted, the
employee must repeat the process each year. If the application
is denied, the employee is retired on the last day of the month
of his or her birth. Mass. Regs. Code tit. 840, 11.01-11.02
(1992).
service after he has attained age seventy and upon retirement such member or other person shall receive a superannuation retirement allowance equal to that which he would have been entitled had he retired at age seventy.
Mass. Gen. L. ch. 32, 90F.
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Barnstable County Retirement Association (BCRA) is one
of the 106 public retirement systems governed by 90F. In 1988
the BCRA required Mary Cavender, a librarian employed by a town
in Massachusetts, to pass a medical examination in order to
continue her employment with the town. She passed the medical
examination and was allowed to continue her employment. No
employees have been forced to retire since 90F has been in
effect.
On September 9, 1989, the Equal Employment Opportunity
Commission (EEOC) brought suit against Massachusetts and the
BCRA. The EEOC alleged that the requirements of 90F that
Massachusetts state and local employees aged seventy or older
take and pass an annual medical examination as a condition of
continued employment was violative of, and hence preempted by,
4(a) of the Age Discrimination in Employment Act (ADEA), 29
U.S.C. 623(a). Section 4(a) provides:
It shall be unlawful for an employer (1) to fail or refuse to hire or to discharge any individual or otherwise discriminate against any individual with respect to his compensation, terms, conditions, or privileges of employment, because of such individual's age; (2) to limit, segregate, or classify his employees in any way which would deprive or tend to deprive any individual of employment opportunities or otherwise adversely affect his status as an employee, because of such individual's age; or (3) to reduce the wage rate of any employee in order to comply with this chapter.
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Following discovery, all parties moved for summary
judgment. The EEOC argued in its motion that 90F was
discriminatory on its face and that defendants had not
established a justification for using age as a factor in
determining who would be required to take and pass a medical
examination as a condition of continued employment.
Massachusetts' answer in its motion for summary judgment was
twofold: first, it argued that 4(a) of the ADEA was not
applicable to the dispute because 90F was not preempted by the
ADEA; second, and in the alternative, Massachusetts argued that
90F did not violate the ADEA because concerns over the fitness of
employees, rather than age, was the basis of the statute.
On April 17, 1992, the district court granted
defendants' motions for summary judgment, denying the EEOC's
motion. The court reasoned that the regulation of its employees
has traditionally been one of the historic powers of the state.
According to the court, the Supreme Court held in Gregory v.
Ashcroft, 111 S.Ct. 2395, 115 L.Ed.2d 410 (1991), that Congress
should make its intention clear and manifest when it intends to
preempt the historic powers of the state. In the view of the
court, Congress, in enacting the ADEA, did not make it clear and
manifest that it intended to "limit employer-states' ability to
assess the fitness of their employees." Moreover, the court
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continued, the practice of requiring employees seventy years of
age or older to undergo an annual medical examination "is a
practice very conducive to the health and well being of those
employed by state government as well as by society at large."
Thus, the court concluded, 90F is not preempted by, and is not
violative of, the ADEA, and for the court to hold otherwise would
be "to indulge in judicial legislation to override the balance of
federal and state powers."
The EEOC now appeals the district court's grant of
summary judgment. The EEOC requests that we reverse the grant of
summary judgment in favor of appellees and that we remand
directing the district court to enter summary judgment in its
favor. The EEOC makes three main arguments in support of its
appeal. First, the EEOC reiterates that 90F violates the ADEA
on its face. Second, the EEOC maintains that age, and not
concerns over employee fitness, is the basis for 90F. Finally,
the EEOC argues that 90F does not qualify for the bona fide
employee benefit exception of the ADEA.
II.
Rule 56(c) of the Federal Rules of Civil Procedure
provides that summary judgment "shall be rendered forthwith if
the pleadings, depositions, answers to interrogatories, and
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admissions on file, together with the affidavits, if any, show
that there is no genuine issue as to any material fact and that
the moving party is entitled to a judgment as a matter of law."
Fed. R. Civ. P. 56(c). We exercise plenary review of summary
judgment dispositions. Olivera v. Nestle Puerto Rico, Inc., 922
F.2d 43, 44-45 (1st Cir. 1990). The facts of this case, as
recounted above, are not in dispute. So, we turn first to the
issue of whether 90F is preempted by the ADEA.
A.
Congress has the power to preempt state legislation
under the Supremacy Clause of Article VI of the Constitution.
Federal preemption law recognizes two types of preemption,
express and implied. Schneidewind v. ANR Pipeline Co., 485 U.S.
293, 300, 108 S.Ct. 1145, 99 L.Ed.2d 316 (1988); Wisconsin Publ.
Intervenor, et al. v. Mortier, 111 S.Ct. 2476, 2482, 115 L.Ed.2d
532 (1991); see also Wood v. General Motors Corp., 865 F.2d 395
(1st Cir. 1988). Express preemption occurs when Congress states
in the text of legislation that it intends to preempt state
legislation in the area. In the absence of such a specific
statement, a federal statute may also preempt by implication a
state statute. The United States Supreme Court has identified
the circumstances under which such implied preemption may occur:
In the absence of explicit statutory language, however, Congress implicitly may indicate an intent to occupy a
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given field to the exclusion of state law. Such a purpose may be inferred where the pervasiveness of the federal regulation precludes supplementation by the States, where the federal interest in the field is sufficiently dominant, or where the "object sought to be obtained by the federal law and the character of obligations imposed by it . . . reveal the same purpose." Finally, even where Congress has not
entirely displaced state regulation in a particular
field, state law is pre-empted when it actually
conflicts with federal law. Such a conflict will be
found "'when it is impossible to comply with both state and federal law, or where the state law stands as an obstacle to the accomplishment of the full purposes and objectives of Congress.'"
Schneidewind, 485 U.S. at 299-300 (citations omitted) (emphasis
added).
Before the district court the EEOC argued, and on
appeal it reiterates, that 90F actually conflicts with 4(a)
due to the impossibility of complying with both statutes.
Specifically, the EEOC maintains that, since only employees who
are seventy years of age or older are required to take and are
forced to retire if they fail an annual medical examination,
90F conflicts with 4(a) of the ADEA providing that it is
unlawful for an employer "to discharge . . . or otherwise
discriminate against any individual with respect to his . . .
terms, conditions, or privileges of employment because of such
individual's age." 29 U.S.C. 623(a)(1).
The district court rejected the EEOC's argument,
finding that in ADEA cases, Congress must expressly state an
-8- 8
intention in order for courts to find federal preemption. The
court determined that the recent Supreme Court decision in
Gregory v. Ashcroft had changed the standards for resolving
conflicts between local and federal government, deferring to
state sovereignty. According to the court, "in an effort to
preserve our federal system of government, the Supreme Court has
indicated that Congress should make its intention clear and
manifest if it intends to preempt the historic powers of the
states." quoting Gregory v. Ashcroft, 111 S.Ct. at 2401. Under
this new standard, the district court concluded that the ADEA is
ambiguous as to whether the statute was intended to apply to such
state legislation as 90F: "[I]t appears ambiguous, and even
unlikely, that Congress intended to outlaw a method of assessment
utilized by a state government which requires annual medical
examinations for its employees at the age of seventy."
It is true that the Gregory Court was unwavering in its
desire to protect state sovereignty and principles of federalism.
Id. at 2399. However, its reasoning and holding were far more
narrow and limited than the broad and sweeping interpretation
made by the district court. In Gregory, the United States
Supreme Court rendered a decision on the effects of the ADEA on
the Missouri Constitution which required mandatory retirement of
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judges.2 Mo. Const. art. V, 26. The relevant clause of the
ADEA provided:
The term "employee" means an individual employed by any employer except that the term "employee" shall not include any person elected to public office in any State or political subdivision of any State by the qualified voters thereof, or any person chosen by such officer to be on such officer's personal staff, or an appointee on the policy making level or an immediate adviser with respect to the exercise of the constitutional or legal powers of the office.
29 U.S.C. 630(f). Due to the method of selection of state
judges in Missouri, it was unclear whether they were employees
within the meaning of 630(f).
It was ultimately the ambiguity of the judges' status
as employees or policymakers which the Court found fatal to their
capacity to be protected by the ADEA. Because Missouri judges
2Three years before the Supreme Court decided Gregory, the
First Circuit adjudicated precisely the same issue. EEOC v.
Massachusetts, 858 F.2d 52 (1st Cir. 1988). In that case,
the court had to determine the effect of the 1987 amendments to the ADEA on a provision of the Massachusetts Constitution which made age 70 the mandatory retirement age for all state judges. The court affirmed the district court's determination that the Act did not override the state constitutional provision, finding that the state's judges fell within the policy-making exception to employees protected by the ADEA, 29 U.S.C. 630(f). The court even relied on the same rationale of respect for principles of sovereignty, as did the Court in Gregory: "Without question,
the tenure of state judges is a question of exceeding importance to each state, and a question traditionally left to be answered by each state. Any federal encroachment on a state's freedom of choice in this area, therefore, strikes very close to the heart of state sovereignty." EEOC, 858
F.2d at 54.
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were subject to retention elections, they could be construed as
elected officials, thus excluded from the ADEA. It was unclear,
however, whether state court judges were state officials on the
"policy-making level." The Gregory Court aptly held that, where
provisions are ambiguous and state sovereignty is at issue,
courts should reason carefully when making determinations as to
preemption. Gregory, 111 S.Ct. at 2401. "Congressional
interference with this decision of the people of Missouri,
defining their constitutional officers, would upset the usual
constitutional balance of federal and state powers. For this
reason, 'it is incumbent upon the federal courts to be certain of
Congress' intent before finding that federal law overrides' this
balance." Id. (quoting Atascadero State Hosp. v. Scanlon, 473
U.S. 234, 243, 105 S.Ct. 3142, 87 L.Ed.2d 171 (1985) (determining
whether federal statute abrogated sovereign immunity of states
under the 11th Amendment)). Based on that reasoning, the Gregory
Court concluded that the ADEA did not preempt the Missouri
Constitution's mandatory requirement for judges. Id. at 2408.
Here, the district court misinterpreted the
significance of the Court's reliance on principles of federalism
and respect for state sovereignty. The Missouri constitutional
provision was concerned, not with regulating health care, but
with ensuring the qualifications of the highest state officials.
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"The[] cases [cited] stand in recognition of the authority of the
people of the States to determine the qualifications of their
most important government officials." Gregory, 111 S.Ct. at
2402; see also EEOC v. Massachusetts., 858 F.2d 52 (1st Cir.
1988), discussed supra note 3. Relying on Sugarman v. Dougall,
413 U.S. 634, 93 S.Ct. 2842, 37 L.Ed.2d 853 (1973), the Court
recognized that Gregory was part of the body of decisions which
involve the Court in adjudicating "the unique nature of state
decisions that 'go to the heart of representative government.'"
Gregory, 111 S.Ct. 2401. The Court made it clear that its
deference arises not from a disdain for preemption doctrine in
the context of the ADEA, but rather because:
the case concerns a state constitutional provision through which the people of Missouri establish a qualification for those who sit as their judges. This
provision goes beyond an area traditionally regulated
by the States; it is a decision of the most fundamental
sort for a sovereign entity. Through the structure of
its government, and the character of those who exercise government authority, a State defines itself as a sovereign.
Id. at 2400 (emphasis added).
Thus, while Gregory refused to find the state
Constitution preempted by the ADEA, the opinion was unequivocally
clear in the narrowness of its holding. At no point did the
Court suggest that all state regulations of public employees are
questions at the heart of state sovereignty. Nor did it suggest
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that Gregory would be controlling on the federal preemption
doctrine where there was not any ambiguity in the language of the
statute. The Court stated: "The ADEA plainly covers all state
employees except those excluded by one of the exceptions. Where
it is unambiguous that an employee does not fall within one of
the exceptions, the Act states plainly and unequivocally that the
employee is included." Id. at 2404.
The district court erred, not only in its
interpretation as to the breadth of the Gregory holding, but also
in its applicability to the instant case. Here, there are no
ambiguities in the terms or provisions of 90F that should give
us pause as to whether those affected are employees within the
meaning of 4(a). The district court determined that the effect
of the 1986 congressional amendment to the ADEA on statutes such
as Massachusetts' is de facto ambiguous. Such reasoning,
however, begs the threshold question of preemption. In Gregory,
the text of the ADEA itself is unclear as to its applicability to
judges, giving rise to ambiguity which the Court resolved in
Missouri's favor. Here, there is no textual uncertainty, and the
proper method of resolving the issue is to analyze the conflict
under the standards of preemption doctrine, something the
district court never did.
B.
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To recapitulate, "in the absence of an express
congressional command, state law is preempted if that law
actually conflicts with federal law." Cipollone v. Liggett Group,
Inc., 112 S.Ct. 2608, 2617, 120 L.Ed.2d 407 (1992). State law
conflicts with federal law when compliance with both is a
physical impossibility. See, e.g., Greenwood Trust Co. v.
Massachusetts, 971 F.2d 818 (1st Cir. 1992); Pedraza v. Shell Oil
Co., 942 F.2d 48 (1st Cir. 1991). 3
Under 90F, retirement boards are required to take
specific action upon the seventieth birthday of state employees.
The possible result of this action is the involuntary retirement
of state employees who fail to pass the requisite tests.
Such action is not reconcilable with the plain purpose of 4(a)
which prohibits employers from discrimination against any
individual with respect to his compensation, terms, conditions,
or privileges of employment, because of such individual's age.
3The district court's opinion focuses on the reasonableness of the state's method of implementing the dual goals of enabling state employees to continue working and ensuring their competency. This is not, however, an equal protection analysis in which rational and legitimate state interests are to be respected by the courts. Under preemption analysis, the focus is not on the purposes of the Commonwealth's statute, but on the interaction between the state statute and the federal statute in question. In the context of the ADEA, reasonableness only enters into judicial analysis in assessments of affirmative defenses available under 4(f).
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For example, in EEOC v. Wyoming, 460 U.S. 226, 103
S.Ct. 1054, 75 L.Ed.2d 18 (1983), the Supreme Court considered
whether a Wyoming statute, which required game and fish wardens
who had reached age 55 to seek the approval of their employer in
order to remain employed, violated the ADEA. Much as
Massachusetts does here, Wyoming argued that the statute in
question did not violate the ADEA on its face because the statute
served in assuring the physical preparedness of Wyoming game
wardens to perform their duties. The Court rejected the argument
and concluded that Wyoming could continue the statute only if it
could demonstrate age was a bona fide occupational qualification
for the job of game warden. Id. at 239. Significantly, the Court
wrote:
Under the ADEA, [] the State may still, at the very least, assess the fitness of its game wardens and dismiss those wardens whom it reasonably finds to be unfit. Put another way, the Act requires the State to achieve its goals in a more individualized and careful manner than would otherwise be the case, but it does not require the State to abandon those goals, or to abandon the public policy decisions underlying them.
Id.
Similarly, here Massachusetts may still assess the
fitness of its employees and dismiss those employees whom it
reasonably finds to be unfit. But it must do so "in a more
individualized and careful manner" than the scheme envisioned by
90F. In other words, Massachusetts is not being asked to
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abandon the public policy of determining the fitness of its
employees, just as Wyoming was not being asked to abandon the
public policy of determining the physical preparedness of its
game wardens. Instead, pursuant to the ADEA, just as Wyoming
could not arbitrarily pick 55 years of age as the point at which
to measure the physical preparedness of its game wardens,
Massachusetts may not arbitrarily set up seventy years of age as
the point at which to determine the fitness of its employees.
The Supreme Court concluded in EEOC v. Wyoming:
[Wyoming] remain[s] free under the ADEA to continue to do precisely what [it is] doing now, if [it] can demonstrate that age is a "bona fide occupational qualification" for the job of game warden. . .. [T]he state's discretion to achieve its goals in the way it thinks best is not being overridden entirely, but it is merely being tested against a reasonable federal standard.
Id. at 240. Here, Massachusetts' discretion to achieve its goals
of determining the fitness of its employees is being tested
against a reasonable federal standard. And, in the absence of an
affirmative defense, we must conclude that compliance with both
the state and federal statutes is a physical impossibility,
meaning that the ADEA must preempt the Massachusetts law.
The two statutes are also in actual conflict because
enforcement of the Massachusetts law creates an obstacle for the
implementation of the goals of the ADEA. Congress enacted the
ADEA to prevent the arbitrary and socially destructive
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discrimination on the basis of age. Western Air Lines v.
Criswell, 472 U.S. 400, 409, 105 S.Ct. 2743, 86 L.Ed.2d 321
(1985); Trans World Air Lines v. Thurston, 469 U.S. 111, 120, 105
S.Ct. 613, 83 L.Ed.2d 523 (1985). The United States Supreme
Court has explained that the ADEA is of particular force when
mandatory retirement is at issue, as it is here. Criswell, 472
U.S. at 410. In the words of the Court, "[t]he legislative
history of the 1978 Amendments to the ADEA makes quite clear that
the policies and substantive provisions of the Act apply with
especial force in the case of mandatory retirement provisions."
Id. Moreover, "[t]hroughout the legislative history of the ADEA,
one empirical fact is repeatedly emphasized: the process of
psychological and physiological degeneration caused by aging
varies with each individual." Id. at 409. Thus, the ADEA was
enacted in large part to prevent mandatory retirement based on
"innocent" misperceptions as to the abilities of older employees,
as well as more insidious "business" judgments as to their cost.
Here, the Commonwealth of Massachusetts allows age to
be the determinant as to when an employee's deterioration will be
so significant that it requires special treatment. Such a
conception of and use of age as a criteria for decline and
unfitness for employment strikes at the heart of the ADEA. The
entire point of the statute is to force employers to abandon
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previous stereotypes about the abilities and capacities of older
workers. Employers may still regulate and condition employment,
but they may no longer immediately turn to age as a convenient,
simple criterion. They must be prepared to justify their use of
age rather than individualized factors.
In finding that the ADEA did not preempt 90F, the
district court reasoned that 90F is "an Act relating to the
qualifications of state employees which was lawful and an
eminently reasonable expression of state power when enacted."
Thus, the Court concluded, to hold 90F as preempted by the ADEA
would be "to indulge in judicial legislation to override the
balance of federal and state powers." No one disputes the
proposition that the historic functions of regulating the
relationship between the public employer and public employees
have traditionally been left to the states. But it is also far
too late in the day to argue that Congress does not have the
power to require states to regulate the public employer\public
employee relationship in a non-discriminatory fashion. 4
Because the district court rested its grant of summary
judgment for the defendants solely on its interpretation of
4Case law supports the application of other federal anti- discrimination statutes to state employment relationships. See EEOC v. County of Allegheny, 705 F.2d 679, 682 (3d Cir.
1983); Rosenfeld v. Southern Pacific Co., 444 F.2d 1219,
1225 (9th Cir. 1971).
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whether the ADEA preempted facially the Massachusetts law, it did
not reach the other defenses made by the Commonwealth. The
appellees, however, reassert those defenses on appeal and we
address them next.
III.
Appellees argue that, even if the annual medical
examination requirement is found to conflict with 4(a) of the
ADEA, 90F is still exempt from the prohibitory provisions of
the ADEA under exceptions denoted in 4(f)(1) and 4(f)(2) of
the ADEA.
A.
Section 4(f)(1) provides that "It shall not be unlawful
for an employer, employment agency, or labor organization (1) to
take any action otherwise prohibited . . . where age is a bona
fide occupational qualification reasonably necessary to the
normal operation of the particular business, or where the
differentiation is based on reasonable factors other than age . .
. ." (emphasis added).
According to appellees, there is a possibility that the
physical examinations could be based on a reasonable factor other
than age. They argue that in interpreting 90F, our focus
should be not on the age requirement which triggers the condition
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of continuing employment, but rather, on the examination
requirement itself. Employees over seventy will not be
involuntarily retired because they are over seventy, but because
their mental and or physical faculties are failing.
We cannot accept this argument. In Los Angeles Dep't of
Water & Power v. Manhart, 435 U.S. 702, 98 S.Ct. 1370, 55 L.Ed.2d
657 (1978), the Supreme Court confronted and rejected a similar
argument. Manhart involved a policy of the Los Angeles
Department of Water and Power requiring larger contributions from
women than men to the Department's pension fund because women as
a group live longer than do men as a group. A class made up of
women employed or formerly employed by the department challenged
the policy as a violation of Title VII of the Civil Rights Act of
1964. Plaintiffs claimed that the contribution differential
constituted discrimination on the basis of sex. The Department
answered that sex was not the factor on which the distinction was
being drawn; it was longevity. The Court rejected this
contention, holding that but for their sex, women would not be
required to pay more for their retirement benefits. The Court
acknowledged that as a class women tend to live longer than men.
Manhart, 435 U.S. at 707. But the Court found it to be equally
true that all individuals in the respective classes do not share
the characteristics that differentiate the average class
-20- 20
representatives. Id. at 708. Thus, the Court reasoned that even
where characteristics may be class-based, Title VII requires
fairness to individuals rather than to classes. Id. In response
to the Department's specific argument that the different
contributions exacted from men and women were based on the factor
of longevity rather than sex, the Court wrote:
It is plain [] that any individual's life expectancy is based on a number of factors, of which sex is only one. The record contains no evidence that any factor other than the employee's sex was taken into account in calculating the [] differential between the respective contributions by men and women. . .. [O]ne cannot say that an actuarial distinction based entirely on sex is "based on any other factor than sex. Sex is exactly what it is based on."
Id.
Similarly, here appellees argue that the requirement
that employees aged seventy or older pass an annual medical
examination is based on fitness rather than age. But, as the
Supreme Court found in Manhart, it is clear that an individual's
fitness to work is based on a number of factors, of which age is
only one. And, as in Manhart, the record contains no evidence
that any factor other than the employee's age was taken into
account in requiring an annual medical examination. Thus, as in
Manhart, we are forced to conclude that age is exactly what 90F
is based on. The reasonable factor other than age defense is
simply not applicable to 90F.
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Appellees argue that Manhart gave only cursory
treatment to this issue and that because it predated Gregory, it
has less weight. Both assertions are incorrect. As an initial
matter, Manhart is clear in holding that the sex-based
differentiation in question could not be justified. Moreover,
in Gregory the reasonable factor defense was never raised.
Finally, while Manhart does arise out of Title VII and not out
of the ADEA, the First Circuit, like the United States Supreme
Court, has made clear that the ADEA tracks the law of Title VII.
Thurston, 469 U.S. at 121; Rivas v. Federacion de Asociaciones
Pecuarias de Puerto Rico, 929 F.2d 814, 820 n.15 (1st Cir. 1991)
("As the substantive provisions of the ADEA were derived in haec
verba from Title VII . . . we may look to constructions of the
term [employer] in the Title VII . . . context for guidance.")
(citing Lorillard v. Pons, 434 U.S. 575, 584 & n. 12, 98 S.Ct.
866, 55 L.Ed.2d 40 (1978); Zipes v. Trans World Airlines, Inc.,
455 U.S. 385, 395 n. 11, 102 S.Ct. 1127, 71 L.Ed.2d 234 (1989));
Loeb v. Textron, Inc., 600 F.2d 1003, 1014, 1015 (1st Cir. 1979).
The alternative defense in 4(f)(1) -- the bona fide
occupational qualification -- is an affirmative defense which the
Commonwealth does not raise. In EEOC v. East Providence, 798
F.2d 524, 528 (1st Cir. 1986), the First Circuit adopted the two-
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pronged test articulated by the United States Supreme Court in
Criswell. Under the Criswell test, in assessing a BFOQ defense,
an employer must first establish that the job qualifications which the employer invokes to justify his discrimination are "'reasonably necessary to the
essence of his business.'" If the employer succeeds in making this showing, it must then establish that it "is compelled to rely on age as a proxy for the safety- related job qualifications validated in the first inquiry."
East Providence, 798 F.2d at 528 (citing Criswell, 472 U.S. at
413-414.) (emphasis in original)). In East Providence the Court
found that the city had successfully established reasonable
necessity and its reliance on age as the ordinance related to
mandatory retirement of police officers over age 60. Here, the
Commonwealth has not tailored the statute to particular jobs, but
rather to all. See also Thurston, 469 U.S. at 122 ("In order to
be permissible under 4(f)(1), however, the age-based
discrimination must relate to a 'particular business.'").
B.
We now turn to appellees' argument that 90F fits
under the 4(f)(2) exemption of the ADEA. That section provides
in relevant part:
It shall not be unlawful for an employer, employment agency, or labor organization . . . to take any action otherwise prohibited under subsection (a), (b), (c), or (e) of this section-- . . . . (B) to observe the terms of a bona fide employee benefit plan--
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(i) where, for each benefit or benefit package, the actual amount of payment made or cost incurred on behalf of an older worker is no less than that made or incurred on behalf of a younger worker . . . (ii) that is a voluntary early retirement incentive plan consistent with the relevant purpose or purposes of this chapter. Notwithstanding clause (i) or (ii) of subparagraph (B), no such employee benefit plan or voluntary early
retirement incentive plan shall excuse the failure to
hire any individual, and no such employee benefit plan
shall [] require or permit the involuntary retirement
of any individual specified by section 631(a) of this
title, because of the age of such individual.
29 U.S.C. 623 (4)(f)(2) (1992) (emphasis added).
In order to be exempt pursuant to 4(f)(2), an
employment plan must be a bona fide plan which is covered by
4(f)(2), the employer's actions must be in observance of the
plan, and the plan must not be a subterfuge to evade the purposes
of the ADEA. Public Employees Retirement System v. Betts, 492
U.S. 158, 109 S.Ct. 2854, 106 L.Ed.2d 134 (1989); EEOC v. Boeing
Svcs. Int'l, 968 F.2d 549 (5th Cir. 1992); EEOC v. Orange County,
837 F.2d 420, 421 (9th Cir. 1988). The plan envisioned in 90F
facially violates the qualification that the plan may not require
or permit involuntary retirement. The United States Supreme
Court in Betts concluded that in order for a benefit plan to
qualify for the 4(f)(2) exemption, it must not be a method of
discriminating in the "nonfringe" aspects of the employment
relationship. Betts, 492 U.S. at 177. The Court elaborated that
4(a)(1) and 4(f)(2) could both be given effect only if
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4(f)(2) exempts bona fide plans that are not a method of
discriminating in other nonfringe benefit areas. Id.; see also
EEOC v. Westinghouse Elec. Corp., 925 F.2d 619, 623 (3d Cir.
1991) ("The Court did not define 'nonfringe benefit' [in Betts]
but its use of the term makes clear that the terms 'bona fide
employee benefit plan' and 'nonfringe benefit' are mutually
exclusive."). Although the Court remanded the case for
resolution of this issue, it held: "As a result of the 1978
amendments, 4(f)(2) cannot be used to justify forced retirement
on account of age." Betts, 492 U.S. at 166 n.2. Similarly, in
Thurston, 469 U.S. at 124, the Court stated that in the context
of 4(f)(2), "any seniority system that includes the challenged
practice is not 'bona fide' under the statute." See also Betts
v. Hamilton County, 897 F.2d 1380, 1381 (6th Cir. 1990) (on
remand from the Supreme Court, determining plan required
involuntary retirement based on age when disability choices were
restricted upon reaching age of sixty).
Section 90F cannot qualify for the 4(f)(2) exemption.
Section 90F acts as a conditional involuntary retirement program,
which some employees may escape through satisfaction of a burden
imposed on them by the statute. It regulates not "fringe
benefits," but the heart of the employment relationship itself.
Section 90F clearly forces retirement in precisely the manner
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which the Supreme Court explicitly found to be beyond the scope
of the exemption.5
IV.
In conclusion, we hold that 90F is violative of, and
is preempted by, the ADEA because it stands in direct conflict
with 4(a) of the ADEA. Specifically, Massachusetts cannot
comply with the ADEA prohibition that no employer may
discriminate against any individual because of age with respect
to compensation, terms, conditions or privileges of employment,
while at the same time requiring employees seventy years of age
or older to pass an annual medical examination as a condition of
continued employment pursuant to 90F. We also hold that 90F
is not exempt from the requirements of the ADEA based on either
of the two exemptions provided in 4(f)(1) or 4(f)(2) of the
ADEA. Under 4(f)(1), we cannot rationally conclude that the
distinction among employees for the purpose of implementing 90F
is based on any reasonable factor other than age. Under
4(f)(2), we cannot rationally find that 90F satisfies the bona
fide employee benefit plan exemption. In order for a plan to
5As is argued in the amicus brief, "Since 90F permits . .
. only those employees age seventy and older who pass the annual examination to continue employment, the only conclusion to be drawn is that those who do not pass the examination are not permitted to continue employment."
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qualify under this exception, there may not be a provision which
requires mandatory retirement. Mandatory retirement is, of
course, the point of 90F.
For the foregoing reasons, we will reverse the order
of the district granting summary judgment in favor of
Massachusetts and the BCRA, and we will remand to the district
court for entry of summary judgment in favor of EEOC and for
further proceedings consistent with this opinion.
Reversed and Remanded.
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