Last week a federal judge found in favor of the Equal Employment Opportunity Commission (EEOC), in a case against Baltimore County's pension plan. The county's pension plan was found to violate the Age Discrimination in Employment Act (ADEA) because it was "inherently discriminatory."
In 2007, Baltimore County changed the way it collected money from employees for their retirement. Employees hired after 2007 were charged a flat rate for their pension benefits, but workers hired prior to 2007 where required to pay higher pension contributions. This was the problem.
During discovery, the part of the litigation process where the parties have to exchange information relevant to the case, the actuarial consultants that managed the Employee Retirement System (ERS) for Baltimore County were disposed.
The judge noted that, "Baltimore County had failed to bring forward non-age related financial considerations that justify the disparity in contribution rates between older and younger workers."
In other words, Baltimore County's deposition of the actuary did not uncover or explain any economic reason why they were requiring older workers to pay more for their pension plan than the younger workers were paying. This is what made it discriminatory.
The case will move on to a determination of damages. Baltimore County has vowed to take the fight to the U.S. Supreme Court to overturn the ruling, and the EEOC has indicated that it will "vigorously litigate these cases, where necessary, to ensure compliance with the law."
Source: EEOC press release, "EEOC Wins Summary Judgment on Liability in Baltimore County Pension Case," October 22, 2012