Dale Kleber was 58 when he applied for a legal position at CareFusion Corp, a unit of medical device maker Becton, Dickinson and Co. The company opted not to even interview him, and hired a person with fewer qualifications--who happened to be 29.
Kleber sued under the Age Discrimination in Employment Act of 1967 (ADEA), which protects employees over the age of 40. The 7th Circuit rejected his claim, saying that the "plain language" of ADEA showed that Congress meant for it to cover only current employees, not candidates, in the case of disparate impact.
When we talk about age discrimination, it often gets lumped together with race and gender discrimination, but they come from two different laws. Race and gender are protected under Title VII of the Civil Rights Act and age discrimination is not. As such, employment attorney Kate Bischoff says, you don't end up with same results with age discrimination that you would with race claims.
The ruling runs counter to conventional wisdom and current practice, and it certainly doesn't make sense for your business to engage in such discrimination when hiring. Employment attorney Jon Hyman said,
We should be encouraging hiring policies that result in diverse workplaces, not carving out protected classes from claims. For example, this decision would permit an employer to advertise for "digital natives," which could have the impact of disparately effecting our older workers.
As Hyman says, this could lead toward advertising that blatantly discriminates against older workers. (In the above lawsuit, the job posting asked for candidates with "no more than" seven years of experience.) Even if Congress meant to limit ADEA to current employers, it seems like an organization that actively sought to hire only young people would create a hostile work environment for any existing over-40s in the company.
As this is a circuit court ruling and not a Supreme Court ruling, it doesn't apply across all 50 states, and you would be foolish to think that you could win a hiring age-discrimination case based on disparate impact in the other circuits. ADEA does clearly cover your current employees, though, so regardless of this ruling, you must not discriminate against your current employees, even in the 7th Circuit.
Regardless, instead of waiting for another court to disagree and the Supreme Court to pick up the cases, Congress needs to act. They can clarify what they meant and amend ADEA to clearly cover job applicants.
UPDATE: Edited to clarify that this ruling applies only to disparate impact cases and not to generalized age discrimination.