The Minnesota Department of Human Services (MDHS) has agreed to pay more than $467,000 to settle an age discrimination complaint filed by retired staffers. MDHS offered early-retirement incentives to some of its employees, but the packages didn’t include payments for retiree health and dental coverage for those who were older than 55 when they retired.
The retirees sued, alleging the practice violated the Age Discrimination in Employment Act (ADEA) because it denied benefits solely on the basis of the retirees’ age.
When EEOC efforts to mediate the dispute failed, the commission sued on behalf of the retirees. Around the same time, a federal judge in another case ruled that a similar plan was discriminatory. That’s when MDHS elected to settle the case.
Under the settlement, the department will reimburse the retirees for back health benefits and must pay for those same benefits moving forward.
Note: Any program that bases benefits or pay on age is potentially discriminatory. The ADEA protects workers age 40 or older from discrimination in wages, benefits or any privileges of employment. Consult your attorney before launching such a program.