The U.S. Equal Employment Opportunity Commission sued Allen Theatres, Inc. for age discrimination in the U.S. District Court of New Mexico on behalf of Abby Parrish, a 30-plus-year employee.
Allen Theatres operates a chain of movie theaters across New Mexico, Arizona, and Colorado.
According to the allegations, Allen Theaters discriminated against Abby Parrish, a manager at the Clovis, New Mexico location, when the president of the company forced him to retire in September 2020, and refused to return him to work in March 2021 because he was 72 years old.
It is also alleged that while Parrish was employed, Allen Theatres stopped paying for his family health insurance coverage once he reached age 65, which was part of an alleged discriminatory company compensation policy. The same policy resulted in Allen Theatres paying employees age 65 and over less in compensation.
The EEOC seeks back pay, compensatory and punitive damages and will seek measures against Allen Theaters to prevent future discrimination. https://www.eeoc.gov/newsroom/eeoc-sues-allen-theatres-age-discrimination
Commentary
If true, the alleged conduct violates the federal Age Discrimination in Employment Act (ADEA). The ADEA protects employees ages 40 and older from employment discrimination based on age.
One of the allegations is Allen Theatres stopped paying for health insurance upon an employee turning 65. The argument is that policy discriminates against employees 65 or older by paying them less than younger employees.
Quoting the EEOC press release:
"A company cannot implement a policy completely stopping medical benefits for its employees when they turn 65," said Regional Attorney Mary Jo O'Neill of the EEOC's Phoenix District Office. "This policy results in employees 65 and over being paid less in employee benefits than younger employees. Further, a company cannot force a well-qualified employee who was satisfactorily performing his job as a theater manager to involuntarily retire simply because of a paternalistic view that people should not be working at age 72."
Allen Theatre's actual policy was not provided. However, it is not a large leap to assume that older employees working for Allen were not allowed to participate in the health plan upon turning 65 because of their eligibility for Medicare or the equivalent. At some point in time, Allen Theatres may have viewed that as a logical means to cut insurance costs.
Whether an employee signs up for government- and employee-subsidized healthcare or not is a decision of the employer. Organizations that provide benefits to employees must provide the benefits equally among all employees or be viewed as denying an employee an opportunity of employment, in this case - healthcare benefits.