No. 05- IN THE UNITED STATES COURT OF APPEALS FOR THE ELEVENTH CIRCUIT CAROLYN BURLISON; JAMES EADY; JERRY FLOYD; ROBERT GUNTER; and STEPHEN REINSCH, v. Plaintiffs, McDONALD S CORPORATION, Defendant. On Petition for Leave to Appeal from the United States District Court for the Northern District of Georgia Atlanta Division BRIEF AMICUS CURIAE OF THE EQUAL EMPLOYMENT ADVISORY COUNCIL IN SUPPORT OF DEFENDANT S PETITION FOR LEAVE TO APPEAL PURSUANT TO 28 U.S.C. 1292(b) June 30, 2005 Ann Elizabeth Reesman McGUINESS NORRIS & WILLIAMS, LLP 1015 Fifteenth Street, N.W. Suite 1200 Washington, DC 20005 (202) 789-8600
Interlocutory Appeal Number 05- Burlison et al., v. McDonald s Corporation, CERTIFICATE OF INTERESTED PARTIES Batten, Mark W. (Counsel for U.S. Chamber of Commerce) Burlison, Carolyn (Plaintiff) Dobkin, Kenneth L. (Counsel for Defendant) Duffey, Jr., William S., (United States District Judge) Duffie, Lewis Traywick (Counsel for Defendant) Eady, James (Plaintiff) Equal Employment Advisory Council (Amicus Curiae) Floyd, Jerry (Plaintiff) Gunter, Robert (Plaintiff) Hunt, Jr., Willis B., (United States District Judge) Hunton & Williams (Counsel for Defendant) Ludwick, Kelly D. (Counsel for Defendant) McDonald s Corporation (Defendant) McGuiness Norris & Williams LLP (Counsel for Amicus Curiae Equal Employment Advisory Council) Merritt & Tenney (Counsel for Amicus Curiae U.S. Chamber of Commerce) Miller Billips & Ates (Counsel for Plaintiffs) Miller III, Harlan Stuart (Counsel for Plaintiffs) C-1 of 3
Interlocutory Appeal Number 05- Burlison et al., v. McDonald s Corporation, CERTIFICATE OF INTERESTED PARTIES, cont. Newsome, Jerry C. (Counsel for Defendant) Paxton, Beth T. (Counsel for Defendant) Proskauer, Rose, LLP (Counsel for Amicus Curiae U.S. Chamber of Commerce) Reesman, Ann Elizabeth (Counsel for Amicus Curiae Equal Employment Advisory Council) Reinsch, Stephen (Plaintiff) Spalten, David Elliot (Counsel for U.S. Chamber of Commerce) U.S. Chamber of Commerce (Amicus Curiae) Zylan, Kathleen D. (Counsel for Defendant) C-2 of 3
Interlocutory Appeal Number 05- Burlison et al., v. McDonald s Corporation, CORPORATE DISCLOSURE STATEMENT Pursuant to Fed. R. App. P. Rules 26.1 and 29(c), Amicus Curiae Equal Employment Advisory Council discloses the following: 1. The Equal Employment Advisory Council has no parent corporations and no subsidiary corporations. 2. No publicly held company owns 10% or more stock in the Equal Employment Advisory Council. Respectfully submitted: June 30, 2005 Ann Elizabeth Reesman McGUINESS NORRIS & WILLIAMS, LLP 1015 Fifteenth Street, N.W. Suite 1200 Washington, DC 20005 (202) 789-8600 C-3 of 3
TABLE OF CONTENTS TABLE OF CITATIONS...ii INTEREST OF THE AMICUS CURIAE...1 STATEMENT OF THE ISSUE...4 STATEMENT OF THE CASE...4 SUMMARY OF REASONS FOR GRANTING THE PETITION...6 REASONS FOR GRANTING THE PETITION...7 I. THIS COURT SHOULD ALLOW AN INTERLOCUTORY APPEAL TO RESOLVE THE CONTROLLING QUESTION OF WHETHER PROVIDING INFORMATION BY DECISIONAL UNIT MEETS THE OWBPA REQUIREMENTS FOR AN ENFORCEABLE RELEASE, AN ISSUE UPON WHICH THERE IS SUBSTANTIAL GROUND FOR DIFFERENCE OF OPINION...7 A. The Question Of The Release s Validity Controls The Outcome Of This Litigation...7 B. There Is Substantial Ground For Difference Of Opinion...7 II. THIS COURT SHOULD GRANT AN INTERLOCUTORY APPEAL BECAUSE THE ISSUE PRESENTED IS OF SUBSTANTIAL IMPORTANCE TO EMPLOYERS GENERALLY...11 CONCLUSION...13
CERTIFICATE OF COMPLIANCE CERTIFICATE OF SERVICE ii
FEDERAL CASES TABLE OF CITATIONS DiBiase v. SmithKline Beecham Corp., 48 F.3d 719 (3d Cir. 1995)...7 Griffin v. Kraft General Foods, Inc., 62 F.3d 368 (11th Cir. 1995)...3 Oubre v. Entergy Operations, Inc., 522 U.S. 422 (1998)...3 FEDERAL STATUTES Age Discrimination in Employment Act, 29 U.S.C. 621 et seq....1 *Title II of the Older Workers Benefit Protection Act, 29 U.S.C. 626(f)... passim 29 U.S.C. 626(f)(1)...8 29 U.S.C. 626(f)(1)(H)...8 29 U.S.C. 626(f)(1)(H)(i)...9 29 U.S.C. 626(f)(1)(H)(ii)...7, 9 28 U.S.C. 1292(b)...1, 4 FEDERAL REGULATIONS 29 C.F.R. 1625.22(f)(3)(i)(B)... 9, 10 63 Fed. Reg. 30624 (June 5, 1998)...3 OTHER AUTHORITIES 2A Norman J. Singer, Statutes and Statutory Construction (6th ed. 2000 & Supp. 2005)...9 United States Dept. of Labor, Bureau of Labor Statistics, News: Mass Layoffs in May 2005 (June 23, 2005)...11 *Citations principally relied upon iii
The Equal Employment Advisory Council respectfully submits this brief amicus curiae contingent upon the granting of the accompanying motion for leave. The brief urges this Court to grant the petition of Defendant McDonald s Corporation for leave to appeal pursuant to 28 U.S.C. 1292(b). INTEREST OF THE AMICUS CURIAE The Equal Employment Advisory Council (EEAC) is a nationwide association of employers organized in 1976 to promote sound approaches to the elimination of discriminatory employment practices. Its membership now includes approximately 330 of the nation s largest private sector companies, collectively providing employment to more than 20 million people throughout the United States. EEAC s directors and officers include many of industry s leading experts in the field of equal employment opportunity. Their combined experience gives EEAC an unmatched depth of knowledge of the practical, as well as legal, considerations relevant to the proper interpretation and application of equal employment policies and requirements. EEAC s members are firmly committed to the principles of nondiscrimination and equal employment opportunity. All of EEAC s member companies are employers subject to the Age Discrimination in Employment Act (ADEA), 29 U.S.C. 621 et seq., and other equal employment statutes and regulations. As employers, and as potential respondents to ADEA charges, EEAC s members are interested in preserving
effective, voluntary means of resolving such claims both actual and potential without the costs, risks, and other burdens associated with litigation. When implementing workforce reductions, many employers, including members of EEAC, offer special, added benefits to departing employees who agree to release legal claims they might otherwise assert against the employer. Individuals who voluntarily accept this option by signing general releases receive severance benefits, e.g., supplemental cash payments, over and beyond any benefits to which they otherwise would be entitled upon termination of their employment. In return, the employer gains relief from the lingering uncertainties and potential liabilities it otherwise would face until expiration of the filing dates for all possible claims relating to the individual s employment. Because of the significant, mutual advantages they afford to both employees and employers, such voluntary severance-and-release programs have been used widely in implementing workforce reduction programs throughout the United States. Employers seeking to secure valid releases are careful to comply with applicable legal requirements, such as those imposed by Title II of the Older Workers Benefit Protection Act (OWBPA), 29 U.S.C. 626(f). Thus, the issues presented in the Petition are extremely important to the nationwide constituency that EEAC represents. The district court below ruled that McDonald s failed to meet the OWBPA requirements because the company 2
provided the required information about individuals selected for a severance-andrelease program by decisional unit rather than on a nationwide level, thus rendering the release unenforceable. The district court s reading of the OWBPA requirements is incorrect and will jeopardize many existing employment termination benefit plans that incorporate a general release of claims. Paradoxically, were employers to adopt the district court s view of the statute, it would place them at risk of having their compliance challenged for being overinclusive. Because of its interest in the application of the nation s civil rights laws, EEAC has, since its founding in 1976, filed numerous briefs as amicus curiae in cases before the United States Supreme Court, the United States Circuit Courts of Appeals and various state supreme courts. As part of this amicus activity, EEAC has participated in numerous cases in this and other courts involving the application of the ADEA and the validity of ADEA releases. 1 Moreover, EEAC participated on the Negotiated Rulemaking Committee that developed the Equal Employment Opportunity Commission (EEOC) s regulations interpreting OWBPA. 63 Fed. Reg. 30624, 30625 (June 5, 1998) (publication of Final Rule, listing members of Committee). 1 E.g., Oubre v. Entergy Operations, Inc. 522 U.S. 422 (1998); Griffin v. Kraft Gen. Foods, Inc., 62 F.3d 368 (11th Cir. 1995). 3
EEAC seeks to assist the Court by highlighting the impact its decision in this case may have beyond the immediate concerns of the parties. STATEMENT OF THE ISSUE Should this Court grant the Petition for Interlocutory Appeal pursuant to 28 U.S.C. 1292(b) because the decision below presents a controlling question of law on which there is a substantial ground for difference of opinion, and because the issue presented is of substantial interest to employers? STATEMENT OF THE CASE Defendant McDonald s Corporation, one of the nation s best known brands, substantially restructured its U.S. business operations in the fall of 2001. (DOC 110, p. 2). 2 The company reduced the number of U.S. divisions from five to three, and the number of regions from thirty-eight to twenty-one. Id. In particular, the Atlanta region grew to include the former Nashville and Greenville regions. (DOC 110, p. 2-3). William Lamar became the General Manager of the newly constituted Atlanta region. Along with the job came the responsibility to determine which current employees would be offered jobs in the new region, and which would be discharged. (DOC 110, p. 3). As a result, sixty-six employees were terminated in the restructuring. (DOC 110, p. 4). 2 Burlison v. McDonald s Corp., 1:03-cv-2884-WSD (N.D. Ga. May 6, 2005). 4
Plaintiffs are among the employees who were terminated. They were offered, and accepted, generous separation benefits in exchange for signing an Agreement and Release in which they waived their claims against the company, including those arising under the Age Discrimination in Employment Act (ADEA). Id. McDonald s provided each of the Plaintiffs with an Information Sheet for Atlanta/Nashville/Greenville Regions listing the job titles and ages of all 208 employees in those three former regions, identifying the employees who had been selected for termination and participation in the separation program, and those who were not being terminated. (DOC 110, p. 4-5). Plaintiffs then sued McDonald s, claiming age discrimination in violation of the ADEA. After discovery regarding the releases, Plaintiffs and McDonald s both moved for summary judgment concerning the validity of the releases. (DOC 110, p. 5). The district court ruled that McDonald s had not met the minimum OWBPA requirements for a knowing and voluntary release, holding that the Information Sheet should have provided the job titles and ages of all employees selected for discharge across the entire nationwide restructuring rather than just the former Atlanta/Nashville/Greenville regions. (DOC 110, p. 17). McDonald s requested and received certification of the district court s order for interlocutory appeal. (DOC 115, p. 1-2). 5
SUMMARY OF REASONS FOR GRANTING THE PETITION The question presented to this Court for interlocutory appeal indeed is a controlling question of law upon which there is substantial ground for difference of opinion. The district court below ruled that the releases of claims executed by Plaintiffs in favor of Defendant McDonald s were invalid and thus unenforceable under Title II of the Older Workers Benefit Protection Act (OWBPA), 29 U.S.C. 626(f), because McDonald s provided statutorily required information about the job titles and ages of all individuals eligible or selected for the program on a regional level, where the selection decisions were made, rather than on a nationwide level. Since the releases, if valid, would bar this litigation, the question of law is controlling. Moreover, since the district court s interpretation of the statute is subject to question, particularly in light of its conflict with the Equal Employment Opportunity Commission s implementing regulation, there is substantial ground for difference of opinion. Further, the issue presented to this Court is of substantial importance to employers generally, and not just the employer involved in this case. Employers making workforce reductions and there are many of them frequently offer severance-and-release programs in which the employers offer substantial benefits beyond those to which the employee is legally entitled in exchange for a release of claims. By undermining the enforceability of such releases, the decision below 6
effectively undermines the incentives for employers to make such offers, to the ultimate detriment of employees who may be facing termination and financial peril. REASONS FOR GRANTING THE PETITION I. THIS COURT SHOULD ALLOW AN INTERLOCUTORY APPEAL TO RESOLVE THE CONTROLLING QUESTION OF WHETHER PROVIDING INFORMATION BY DECISIONAL UNIT MEETS THE OWBPA REQUIREMENTS FOR AN ENFORCEABLE RELEASE, AN ISSUE UPON WHICH THERE IS SUBSTANTIAL GROUND FOR DIFFERENCE OF OPINION A. The Question Of The Release s Validity Controls The Outcome Of This Litigation A valid release of the claims made in litigation leaves nothing further to litigate, thus ending the case. Cf. DiBiase v. SmithKline Beecham Corp., 48 F.3d 719 (3d Cir. 1995). Accordingly, were this court to reverse the district court s ruling, the decision would control unequivocally the outcome of the case. Moreover, the question is one of law: the proper interpretation of a particular provision of the Older Workers Benefit Protection Act (OWBPA), 29 U.S.C. 626(f). Thus, McDonalds request before this Court for leave to take an interlocutory appeal states a controlling question of law. B. There Is Substantial Ground For Difference Of Opinion The district court s interpretation of 29 U.S.C. 626(f)(1)(H)(ii) not only takes a tortured and illogical view of the statute, but also conflicts with the Equal 7
Employment Opportunity Commission s regulations interpreting the OWBPA. Accordingly, there are reasonable grounds for differences of opinion as to the issue before the Court. Under OWBPA, an individual may not waive ADEA rights unless the waiver is knowing and voluntary. 29 U.S.C. 626(f)(1). The statute then establishes a set of minimum requirements for a knowing and voluntary waiver. These include heightened requirements when the waiver is requested as part of an exit incentive or other employment termination program being offered to a group or class of employees. 29 U.S.C. 626(f)(1)(H). In particular, the statute requires the employer to provide information to each person to whom the program is offered as to: (i) any class, unit, or group of individuals covered by such program, any eligibility factors for such program, and any time limits applicable to such program; and (ii) the job titles and ages of all individuals eligible or selected for the program, and the ages of all individuals in the same job classification or organizational unit who are not eligible or selected for the program. 29 U.S.C. 626(f)(1)(H). In the district court s view, the OWBPA required McDonalds to provide to the Atlanta/Nashville/Greenville region employees the job titles and ages of all individuals eligible or selected for the program on a nationwide level, even though the information would cover many individuals outside that organizational unit, and even though, as the district court 8
acknowledged, the information requirement regarding the employees who are not eligible or selected for the program was limited to the Atlanta/Nashville/Greenville region. It takes a strained reading of the statute to support the district court s view. The second clause of the statutory provision refers explicitly to the same job classification or organizational unit.... 29 U.S.C. 626(1)(H)(ii). The word same can refer only to the same job classification or organizational unit as those individuals referred to in the first part of the clause. The district court s reading simply overlooks the word same, thus violating the elementary rule of [statutory] construction that effect must be given, if possible, to every word, clause, and sentence of a statute. 2A Norman J. Singer, Statutes and Statutory Construction, 46.06 (6th ed. 2000 & Supp. 2005) (footnote omitted). Moreover, the district court s interpretation contradicts the regulations adopted by the Equal Employment Opportunity Commission (EEOC) interpreting OWBPA. According to those regulations, both the phrase class, unit or group in 29 U.S.C. 626(f)(1)(H)(i) and the phrase job classification or organizational unit in 29 U.S.C. 626(f)(1)(H)(ii) refer to the same group of people, as defined by the decisionmaking process the employer utilized to make the selections for the program, called the decisional unit. 29 C.F.R. 1625.22(f)(3)(i)(B). As the regulation explains: 9
A decisional unit is that portion of the employer s organizational structure from which the employer chose the persons who would be offered consideration for the signing of a waiver and those who would not be offered consideration for the signing of a waiver. The term decisional unit has been developed to reflect the process by which an employer chose certain employees for a program and ruled out others from that program. Id. Accordingly, the regulations direct employers to provide information at the level at which the selection decisions are actually made both as to which employees will be included and which will not. Finally, the district court s reading of the statute is plainly illogical, since the statistical information the court s interpretation requires does not allow for meaningful comparisons. A comparison of the ages of the employees in the former Atlanta/Nashville/Greenville region who were and were not selected to participate could yield a useful result. A comparison of the employees nationwide who were selected for the program, and the employees in the former Atlanta/Nashville/Greenville region who were not, compares apples and oranges. Paradoxically, were employers to provide the information in the manner required by the district court, plaintiffs would almost certainly challenge their actions as being overinclusive and designed to mask discrimination. Under the regulations, McDonald s did precisely what it was supposed to do. The decisional unit in the former Atlanta/Nashville/Greenville region was that region it was from that group that the new region s General Manager selected 10
which employees would be retained and which would be terminated. Thus, there is certainly ground for a difference of opinion as to the controlling question of law before this Court. II. THIS COURT SHOULD GRANT AN INTERLOCUTORY APPEAL BECAUSE THE ISSUE PRESENTED IS OF SUBSTANTIAL IMPORTANCE TO EMPLOYERS GENERALLY According to the most recent report of the Department of Labor s Bureau of Labor Statistics (BLS) Mass Layoff Statistics Program, 3 in May 2005 alone employers took 1,196 mass layoff actions, defined as layoffs of 50 or more workers, involving a total of 128,771 employees. During the first five months of calendar year 2005, there were 6,249 mass layoff events, involving 665,130 workers. Id. While it is impossible to ascertain accurately how many of these layoffs involved severance-and-release programs, it is reasonable to assume that many of them did. Many employers faced with the necessity of workforce reductions offer severance benefits, as McDonald s did here, to ease the impact of lost employment. The benefits provided by these programs often are quite substantial and far in excess of any to which the employees legally would be entitled. Some employers, depending on financial circumstances and other considerations, also offer early 3 United States Dept. of Labor, Bureau of Labor Statistics, News: Mass Layoffs in May 2005 (June 23, 2005), available at http://www.bls.gov/news.release/pdf/mmls.pdf. 11
retirement incentives and other voluntary termination programs as a way of avoiding or reducing involuntary terminations. Because these employers are offering benefits considerably greater than they are legally required to provide, they frequently ask that the employees who choose to accept such benefits execute a release of claims in return. Of course, employees cannot be forced or coerced to sign releases against their will, but those who do not sign do not receive the additional benefits. In this way, the employer buys peace, and employees who choose to participate receive substantial additional benefits. The decision below places in jeopardy many releases that already have been obtained by employers who followed the EEOC regulations and provided the required OWBPA information by decisional unit. For these employers, like McDonald s, the decision below substantially undermines the finality and certainty for which they paid substantial consideration for what they reasonably believed was a valid release. Moreover, the decision below, by creating additional confusion about the minimum OWBPA requirements for obtaining a valid release, may jeopardize the payment of severance benefits to departing employees in the future. Substantial uncertainty about the legal requirements creates a substantial disincentive for employers to offer severance-and-release benefits. Even for those employers that 12
continue to do so, the lack of certainty will substantially reduce the amount they are willing to pay for what may only be a partial release. Since reductions in force still may be a financial necessity or business option from time to time, they will still occur, but without the additional benefits offered in the past. As a consequence, the many employees who face layoffs but have no grounds to challenge their terminations will be deprived of a substantial payment that might mean the difference between financial security and financial peril. CONCLUSION For the foregoing reasons, the amicus curiae Equal Employment Advisory Council respectfully submits that the Petition for Interlocutory Appeal should be granted. Respectfully submitted, June 30, 2005 Ann Elizabeth Reesman McGUINESS NORRIS & WILLIAMS, LLP 1015 Fifteenth Street, N.W. Suite 1200 Washington, DC 20005 (202) 789-8600 13
CERTIFICATE OF COMPLIANCE I, Ann Elizabeth Reesman, hereby certify that the Brief Amicus Curiae of the Equal Employment Advisory Council in Support of Defendant s Petition for Leave to Appeal Pursuant to 28 U.S.C. 1292(b) complies with the type-volume limitations set forth in Federal Rules of Appellate Procedure 32(a)(7)(B)(i) and 20(d). The brief contains 2,716 words in Times New Roman 14 point typeface. June 30, 2005 Ann Elizabeth Reesman McGUINESS NORRIS & WILLIAMS, LLP 1015 Fifteenth Street, N.W. Suite 1200 Washington, DC 20005 (202) 789-8600
CERTIFICATE OF SERVICE I hereby certify that on June 30, 2005 two true and correct copies of the foregoing Brief Amicus Curiae of the Equal Employment Advisory Council In Support of Defendant s Petition for Leave to Appeal Pursuant to 28 U.S.C. 1292(b) were served via Federal Express Priority Overnight delivery on each of the following: Harlan S. Miller MILLER, BILLIPS & ATES, P.C. 730 Peachtree Street Suite 750 Atlanta, GA 30308 Kelly D. Ludwick Kenneth L. Dobkin HUNTON & WILLIAMS LLP Bank of America Plaza, Suite 4100 600 Peachtree Street, NE Atlanta, GA 30308 I further certify that an original and 6 copies of the foregoing brief were filed on this day via Federal Express Priority Overnight courier delivery addressed to Thomas K. Kahn, Clerk of the Court, United States Court of Appeals for the Eleventh Circuit, 56 Forsyth Street, N.W., Atlanta, GA 30303. Ann Elizabeth Reesman