Former IBM Employees Sue Company in Federal Age-Discrimination Lawsuit
The former workers say they are just four of more than 20,000 IBM employees over age 40 who've been discharged during the past six years as the company secretly looked “to correct seniority mix” by replacing baby boomers with college graduates and other tech-savvy young workers.
March 27, 2019 at 06:09 PM
5 minute read
Four former IBM employees over age 55 sued the company Wednesday in what plaintiffs lawyers say is a potentially major age-discrimination lawsuit, alleging that top executives “took the calculated risk of openly breaking the law” to cover up massive, targeted layoffs of older workers.
The former workers, in a federal lawsuit focused on alleged company violations of the Older Workers Benefit Protection Act and the Age Discrimination in Employment Act, say they are just four of more than 20,000 IBM employees over age 40 who've been discharged during the past six years as the company secretly looked “to correct seniority mix” by replacing baby boomers with recent college graduates and other tech-savvy young workers.
The lawsuit centers many of its allegations on IBM's alleged effort to conceal from older workers minimum information about the layoff demographics—information the plaintiffs say was required under the Older Workers Benefit Protection Act, or OWBPA—while asking the laid-off workers to release their federal right to bring age-discrimination claims collectively as a group.
Lawyers representing the plaintiffs at Cohen Milstein Sellers & Toll and Johnson Webbert & Young have also filed a separate-but-related arbitration action, they noted on Wednesday. In that action, their clients seek to have a notice issued to all older laid-off IBM employees who were allegedly also coerced into signing invalid releases. Moreover, the arbitration filing asks for certification of group collective claims under the Age Discrimination in Employment Act, as well as lost wages and injunctive relief, the lawyers say.
“[IBM's] effort [to discriminate] was the culmination of its internal reviews that stereotyped older workers as rigid and unreceptive to technology, and branded millennial employees as innovative,” Cohen Milstein and Johnson Webbert said in a news release Wednesday that was issued shortly after their federal lawsuit was filed in court in White Plains.
“For example,” the lawyers said, “an internal report of IBM described older employees as 'gray hairs' and 'old heads' and concluded that younger workers 'are generally much more innovative and receptive to technology than baby boomers so changing the organizational technology and the processes it supports can be a wise move.'”
IBM on Wednesday said in a statement that “the plaintiffs' legal theory will fail, as similar cases have, and we are confident IBM's agreements are valid and lawful.”
Added company spokesman Ed Barbini, “IBM does not discriminate, and makes its employment decisions based on skills, not age.”
The 19-page federal lawsuit launched by plaintiffs Steven Estle, Margaret Ahlders, Lance Salonia and Cheryl Witmer seeks declaratory and other relief, including voiding former employees' waivers of their rights under theAge Discrimination in Employment Act, or ADEA.
The lawsuit itself, the plaintiffs lawyers noted in the news release, comes after the publication of a ProPublica story headlined “Cutting 'Old Heads' at IBM” that the lawyers say exposed the company's age-discrimination practices. Using footnotes in the complaint, the plaintiffs reference the article for certain allegations.
The former employees' suit claims that in 2014, IBM ended its longtime practice of giving laid-off workers age-specific, demographic information about the layoff selections as required by the OWBPA.
According to the news release, “instead [IBM] began implementing a company-wide plan, hatched by top executives,” to hide evidence of “large-scale discriminatory layoffs—called 'Resource Actions'—that eliminated older employees in favor of much younger ones.”
The four plaintiffs were terminated in resource actions in 2016, they claim. In the news release, their attorneys said past practice at IBM, dating back to 2001, was to give workers “comparator information” required by the OWBPA when the company sought rights-waivers as part of a group layoff.
“However, in 2014, IBM made an intentional decision to begin concealing this minimum information about the layoff demographics,” the news release said, adding that “IBM also coerced laid-off workers to sign arbitration agreements waiving their federally-protected rights to bring ADEA claims in court.”
Moreover, the suit alleges that IBM devised rules making older workers more likely to be selected for “resource actions,” including by exempting “early professional hires.” In addition, the company allegedly manipulated its performance review process by ordering the reduction of the annual performance ratings for older workers and by using a sham evaluation score for employees.
“IBM's strategy—flouting the OWBPA's mandated disclosures of key evidence of possible age discrimination—is a brazen attempt to cover up its flagrant and widespread discrimination against older workers,” Jeffrey Neil Young, a partner at Johnson Webbert in Portland and Augusta, Maine, said in the news release.
In a phone interview, Joseph Sellers of Cohen Milstein Sellers & Toll said that he has “not seen before an effort like IBM's to [allegedly] make an end-run around the OWBPA, and this lawsuit is challenging this unlawful tactic.”
He added that “IBM is relying on unlawful and unjustified stereotypes to remove older workers who have decades of tech experience, and this suit is also challenging that.”
The plaintiffs lawyers filed the separate-but-related arbitration claims because IBM's severance agreement requires them to take their claims to arbitration, the lawyers said.
This content has been archived. It is available through our partners, LexisNexis® and Bloomberg Law.
To view this content, please continue to their sites.
Not a Lexis Subscriber?
Subscribe Now
Not a Bloomberg Law Subscriber?
Subscribe Now
NOT FOR REPRINT
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
You Might Like
View AllHunter Biden Sues Fox, Ex-Chief Legal Officer Over Mock Trial Series
14-State Coalition Sues TikTok, Alleging Addictive Algorithms Trigger Mental Health Harms in Adolescents
NY Federal Judge Rules Online-Only Retailers Cannot Face ADA Claims
Trending Stories
- 1Infant Formula Judge Sanctions Kirkland's Jim Hurst: 'Overtly Crossed the Lines'
- 2Trump's Return to the White House: The Legal Industry Reacts
- 3Election 2024: Nationwide Judicial Races and Ballot Measures to Watch
- 4Climate Disputes, International Arbitration, and State Court Limitations for Global Issues
- 5Judicial Face-Off: Navigating the Ethical and Efficient Use of AI in Legal Practice [CLE Pending]
- 6How Much Does the Frequency of Retirement Withdrawals Matter?
Who Got The Work
Michael G. Bongiorno, Andrew Scott Dulberg and Elizabeth E. Driscoll from Wilmer Cutler Pickering Hale and Dorr have stepped in to represent Symbotic Inc., an A.I.-enabled technology platform that focuses on increasing supply chain efficiency, and other defendants in a pending shareholder derivative lawsuit. The case, filed Oct. 2 in Massachusetts District Court by the Brown Law Firm on behalf of Stephen Austen, accuses certain officers and directors of misleading investors in regard to Symbotic's potential for margin growth by failing to disclose that the company was not equipped to timely deploy its systems or manage expenses through project delays. The case, assigned to U.S. District Judge Nathaniel M. Gorton, is 1:24-cv-12522, Austen v. Cohen et al.
Who Got The Work
Edmund Polubinski and Marie Killmond of Davis Polk & Wardwell have entered appearances for data platform software development company MongoDB and other defendants in a pending shareholder derivative lawsuit. The action, filed Oct. 7 in New York Southern District Court by the Brown Law Firm, accuses the company's directors and/or officers of falsely expressing confidence in the company’s restructuring of its sales incentive plan and downplaying the severity of decreases in its upfront commitments. The case is 1:24-cv-07594, Roy v. Ittycheria et al.
Who Got The Work
Amy O. Bruchs and Kurt F. Ellison of Michael Best & Friedrich have entered appearances for Epic Systems Corp. in a pending employment discrimination lawsuit. The suit was filed Sept. 7 in Wisconsin Western District Court by Levine Eisberner LLC and Siri & Glimstad on behalf of a project manager who claims that he was wrongfully terminated after applying for a religious exemption to the defendant's COVID-19 vaccine mandate. The case, assigned to U.S. Magistrate Judge Anita Marie Boor, is 3:24-cv-00630, Secker, Nathan v. Epic Systems Corporation.
Who Got The Work
David X. Sullivan, Thomas J. Finn and Gregory A. Hall from McCarter & English have entered appearances for Sunrun Installation Services in a pending civil rights lawsuit. The complaint was filed Sept. 4 in Connecticut District Court by attorney Robert M. Berke on behalf of former employee George Edward Steins, who was arrested and charged with employing an unregistered home improvement salesperson. The complaint alleges that had Sunrun informed the Connecticut Department of Consumer Protection that the plaintiff's employment had ended in 2017 and that he no longer held Sunrun's home improvement contractor license, he would not have been hit with charges, which were dismissed in May 2024. The case, assigned to U.S. District Judge Jeffrey A. Meyer, is 3:24-cv-01423, Steins v. Sunrun, Inc. et al.
Who Got The Work
Greenberg Traurig shareholder Joshua L. Raskin has entered an appearance for boohoo.com UK Ltd. in a pending patent infringement lawsuit. The suit, filed Sept. 3 in Texas Eastern District Court by Rozier Hardt McDonough on behalf of Alto Dynamics, asserts five patents related to an online shopping platform. The case, assigned to U.S. District Judge Rodney Gilstrap, is 2:24-cv-00719, Alto Dynamics, LLC v. boohoo.com UK Limited.
Featured Firms
Law Offices of Gary Martin Hays & Associates, P.C.
(470) 294-1674
Law Offices of Mark E. Salomone
(857) 444-6468
Smith & Hassler
(713) 739-1250