Holt v. Gamewell Corp., 85-1976

• Decision Date: 30 July 1986
• Docket Number: No. 85-1976,85-1976
• Citation: 797 F.2d 36
• Parties: 41 Fair Empl.Prac.Cas. 585, 40 Empl. Prac. Dec. P 36,334 Richard S. HOLT, Plaintiff, Appellant, v. The GAMEWELL CORPORATION, Defendant, Appellee.
• Court: U.S. Court of Appeals — First Circuit

Page 36

797 F.2d 36

41 Fair Empl.Prac.Cas. 585,

40 Empl. Prac. Dec. P 36,334

Richard S. HOLT, Plaintiff, Appellant, v. The GAMEWELL CORPORATION, Defendant, Appellee.

No. 85-1976.

United States Court of Appeals First Circuit.

Argued April 7, 1986.

Decided July 30, 1986.

Paul A. Manoff, Boston, Mass., for appellant.

Phillips Axten, with whom Alan D. Rose, Francisca D. Morant and Nutter, McClennen & Fish, Boston, Mass., were on brief, for appellee.

Before BOWNES, BREYER and TORRUELLA, Circuit Judges.

TORRUELLA, Circuit Judge.

This case is before us on appeal from a summary judgment finding that appellee The Gamewell Corporation (Gamewell) did not violate the Age Discrimination in Employment Act (the ADEA), 29 U.S.C. Sec. 621 et seq., when it terminated appellant Holt's employment as part of a general reduction in force. At the time of the discharge, Holt was 63 years old and he was earning an annual salary of $43,825 as purchasing manager of Gamewell.

Holt's discharge occurred in the following manner: On June 29, 1984, Alan Walters (Walters), president of Gamewell, was informed by the board of directors of its parent corporation, that it was necessary to reduce the company's yearly payroll expense by $500,000. This decision was reached because Gamewell had experienced large net operating losses since the time of its acquisition in April 1981. There was general agreement among those meeting on the matter that, in order to reach that figure with a minimum negative effect on Gamewell's ability to operate efficiently, it would be necessary to eliminate several high-level as well as low-level positions. It was Walters' goal to meet the budget cut through the elimination of twenty positions in all. Walters, in turn, notified Eugene Zorn (Zorn), the company's vice-president and technical director, that he would have to layoff from 10-12 employees from his area of operations. Zorn was also told that the criteria to use in selecting employees for layoff was to focus on those persons whose positions could be eliminated or whose duties could be absorbed by others without significantly imparing Gamewell's operating capacity. Zorn was instructed to present his recommendations by July 3rd.

Zorn in turn called upon Frederick Hayes (Hayes), the director of manufacturing operations, to make recommendations for the layoff of two higher salaried and three lower salaried employees. Hayes was told that it was critical to ensure that the duties of any person discharged could be covered by other employees or eliminated altogether. He was further instructed that $30,000 per year was the dividing line of those considered to be the higher salaried group. Out of a group of six selected for review, Hayes chose to discharge Holt and Frank DeLoreto, the chief industrial engineer, as within the higher salaried group.

Appellant does not argue with the company's position that the criteria for discharge was both high salary and the ability of other employees to take on the duties of the discharged employee. Rather, it is his contention that a higher salary is directly related to seniority and is, therefore, a function of age, an illegal criteria for discharge.

An employee suing his employer for age discrimination must show either disparate treatment or a discriminatory impact. To prove disparate treatment, he must show purposeful or intentional discrimination. Massarsky v. General Motors Corp., 706 F.2d 111, 117 (3d Cir.), cert. denied, 464 U.S. 937, 104 S.Ct. 348, 78 L.Ed.2d 314 (1983). To prove a disparate impact, he must prove that a facially neutral practice has a significant discriminatory impact on members of the protected class. Connecticut v. Teal, 457 U.S. 440, 446, 102 S.Ct. 2525, 2530, 73 L.Ed.2d 130 (1982); Massarsky, supra at 117; Geller v. Markham, 635 F.2d 1027 (2d Cir.1980).

In cases involving reduction in force, in order to establish a prima facie case of age discriminatory treatment a plaintiff must show that: (1) he was in the protected age group; (2) he was performing his job at a level that met his employer's legitimate expectation; (3) he was fired; and (4) the employer did not treat age neutrally or that younger persons were retained in the same position. E.E.O.C. v. Western Electric Co., Inc., 713 F.2d 1011, 1014-15 (4th Cir.1983). There is no doubt that Holt has fulfilled the first three elements. He has failed, however, to show that age was not treated neutrally.

Holt compares himself to the three buyers who worked under him, all of whom were younger than h...