Slusher v. Hercules, Inc.
| Citation | 70 ALR Fed 93,532 F. Supp. 753 |
| Decision Date | 17 February 1982 |
| Docket Number | Civ. A. No. 78-0068-R. |
| Court | U.S. District Court — Western District of Virginia |
| Parties | Sylvia M. SLUSHER, Plaintiff, v. HERCULES, INCORPORATED, Defendant. |
Harriet Dickinson Dorsey, Blacksburg, Va., Donald W. Huffman, Roanoke, Va., for plaintiff.
Edwin C. Stone, Timothy C. Kavanaugh, Radford, Va., for defendant.
Plaintiff, Sylvia M. Slusher, brings this suit against her former employer, Hercules, Incorporated, alleging that Hercules violated the Age Discrimination in Employment Act of 1967 (ADEA), by forcing her to retire pursuant to the defendant's disability provision of its pension plan. Mrs. Slusher contends that Hercules unlawfully terminated her from her employment due to her age. This case is presently before the court on the defendant's motion for summary judgment on the basis that plaintiff was retired pursuant to the provisions of a bona fide pension plan which was not established as a subterfuge to evade the purposes of the ADEA. For the reasons stated below, the defendant's motion for summary judgment is granted.
The pleadings show that the plaintiff is presently sixty years of age, and was employed by the defendant from March 12, 1951 until her termination in 1976. On May 6, 1976, the plaintiff was instructed by her supervisor to report to the company doctor's office. When she arrived, the doctor informed her she was being given a pension based on disability. She received a form notice entitled "Termination of Employment for Salaried and Wage Employees" dated 5/6/76. The plaintiff's name appears below that date, and below her name are the words "Effective Date of Termination", followed by the date 5/31/76. The plaintiff was paid her regular salary and employee benefits from May 6 through May 31, at which time her employment was officially terminated by Hercules, Inc., and disability pension benefits began. Plaintiff, believing she had been unlawfully discriminated against because of her age, attempted without success to effect a reconciliation with the defendant through the United States Department of Labor. Failing to obtain an administrative settlement, plaintiff filed a civil action in this Court alleging age discrimination under the Age Discrimination Employment Act of 1967 (ADEA), 29 U.S.C. §§ 621 et seq.
The defendant filed a motion for summary judgment with this court on February 11, 1981. Defendant contends that plaintiff was involuntarily retired on May 5, 1976, pursuant to the terms of an employee benefit plan that has been in effect at Hercules since January 1, 1959. Defendant argues that its retirement plan, which includes involuntary disability retirement, is a bona fide retirement and disability pension plan which was in effect prior to the enactment of the Age Discrimination in Employment Act. Therefore, the defendant concludes, the retirement of the plaintiff cannot be in violation of the ADEA since it observed the terms of a bona fide plan which was not a subterfuge to evade the purposes of the ADEA.
The purpose of the ADEA is stated as follows:
to promote employment of older persons based on their ability rather than age; to prohibit arbitrary age discrimination in employment; to help employers and workers find ways of meeting problems arising from the impact of age on employment.
29 U.S.C. § 621(b) (1976). Under the ADEA it is unlawful for an employer:
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 ....
29 U.S.C. § 623(a)(1).
At the time of Mrs. Slusher's retirement, § 623(f)(2) of the ADEA contained the following language permitting some involuntary retirements prior to normal retirement age:
29 U.S.C. § 623(f)(2) (amended 1978). In 1978, that subsection was amended to provide as follows:
29 U.S.C. at § 623(f)(2) (Supp.1981) (emphasis added). Congress provided that the amendment "shall take effect on the date of enactment of this Act April 6, 1978." Pub.L. No. 95-256 § 2(b), 92 Stat. 189.1
The first issue presented in this case is whether or not defendant's motion for summary judgment is so untimely as to constitute a waiver of the issues presented therein. If the court finds that defendant's motion is timely, the more important question remains whether Hercules' action was unlawful under the unamended version of § 623(f)(2), which was in effect at the time of Mrs. Slusher's retirement. Answering both questions in the negative, the court grants summary judgment to the defendant.
Plaintiff's employment with Hercules, Incorporated, was terminated in May of 1976. From that time until the filing of her complaint in this ADEA suit on March 28, 1978, plaintiff and defendant, through counsel and with the assistance of the U.S. Department of Labor, engaged in protracted settlement discussions. Defendant filed its answer to plaintiff's complaint on May 1, 1978, and that answer has never been amended or supplemented. Defendant filed its motion for summary judgment on or about February 9, 1981, with the trial of this case set to begin on February 25, 1981. Defendant presents only one argument upon which it relies in moving the Court to grant this motion: that Sylvia M. Slusher was not terminated or discharged, but "retired pursuant to a bona fide pension plan", which retirement is exempted from scrutiny under the provisions of the ADEA as it existed prior to the 1978 amendments.
It is plaintiff's position that defendant cannot be permitted to raise this issue when this defense was not raised in its answer. An examination of defendant's answer shows that it merely denied plaintiff's claims and raised certain affirmative defenses in Paragraphs 21 through 28, none of which hint at the defense defendant raises in its motion for summary judgment. Paragraph 25 is the only paragraph which refers to the subject matter of defendant's motion for summary judgment, and it does not mention that it is defendant's contention that Sylvia M. Slusher was "retired" and not "discharged". The plaintiff moves the Court to deny defendant's motion for summary judgment on the grounds that defendant failed to raise this issue in its responsive pleadings as required by Rule 12 of the Federal Rules of Civil Procedure.
The court does not find that the defendant has waived its right to move for summary judgment on this defense by reason of its failure to plead the defense affirmatively in its answer. Defendant does not raise an affirmative defense which could be waived under Rule 8(c) of the Federal Rules of Civil Procedure. See Funding Systems Leasing Corp. v. Pugh, 530 F.2d 91 (5th Cir. 1976). Nor has the case progressed so far as to prejudice the plaintiff by allowing amendment of the defendant's answer. Cf. id. Rather, the court is guided by the Fourth Circuit's admonition that "the principles governing summary judgment procedures should be applied in a common sense manner to the realities of the litigation at hand." Williams v. Howard Johnson's Inc. of Washington, 323 F.2d 102, 105 (4th Cir. 1963). Plaintiff's objection is "not tenable in view of the general purposes of the Rules that decisions should go on the merits and not on pleading technicalities, and for the further reason that the Rules prescribe most liberally for the amendment of pleadings." 6 Moore's Federal Practice ¶ 56.1714. See Season-All Indus., Inc. v. Merchant Shippers, 417 F.Supp. 998 (W.D.Pa.1976). Therefore, exercising the wide discretion available to this court in procedural matters, the court holds that defendant's motion for summary judgment, and defense therein, is without prejudice to the plaintiff, and thereby timely.
According to subsection 623(f)(2), an employer must show (1) that it "observed the terms" of a (2) "bona fide ... plan" that (3) was "not a subterfuge to evade the purposes" of the Act, in order to be exempt from the restrictions of the ADEA when involuntarily retiring an employee at an age earlier than that prescribed by the Act. Carpenter v. Continental Trailways, 635 F.2d 578, 580 (6th Cir. 1980), cert. denied, 451 U.S. 986, 101 S.Ct. 2320, 68 L.Ed.2d 844 (1981); E.E.O.C. v. Baltimore and Ohio R. Co., 632 F.2d 1107, 1110 (4th Cir. 1980), cert. denied, 450 U.S. 965, 101 S.Ct. 1480, 67 L.Ed.2d 613 (1981). The parties in this case disagree as to whether the defendant has complied with each element of the exemption outlined in 29 U.S.C. § 623(f)(2).
Initially, plaintiff contends that defendant's pension plan is not "bona fide" because it does not pay substantial benefits. The parties agree that defendant's...
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...Moreover, the district court's reasoning in Hannan has been called into question. As the district court noted in Slusher v. Hercules, Inc., 532 F.Supp. 753 (W.D.Va.1982), before Section 4(f) was amended to exclude mandatory retirement from its coverage, if an employer's action in involuntar......