IBM Gets Former Workers’ Proposed Age Bias Class Trimmed Further

IBM Corp. convinced a Manhattan federal judge to drop 24 former employees from a proposed class action alleging the company systematically replaced older workers with younger ones.

Ten of the workers waived their right to sue under the Age Discrimination in Employment Act when they accepted IBM’s offer of a severance package when they were terminated, the US District Court for the Southern District of New York said Tuesday. The waivers met the requirements of the Older Workers Benefit Protection Act because each of the workers was discharged on an individual basis, the court said.

It rejected the workers’ contention that they were really part of group terminations, which would have required IBM to provide them with more information for their ADEA claim waivers to be valid under the benefits law.

The statute and its implementing regulations don’t define “group termination,” Judge Valerie E. Caproni said. But the workers failed to make “a meaningful effort” to demonstrate that they were part of group terminations, she said.

They instead relied “on generalized information that IBM wanted to reduce the number of older employees.” That wasn’t enough, Caproni said.

The timing of their terminations, which occurred “over a period of years,” also suggested they weren’t group terminations, the court said. So did the fact that each of them were given specific reasons for their firing.

One worker failed to meet her sales quotas, for example. Others didn’t satisfy the terms of a performance improvement plan, and another requested severance in lieu of trying to improve his performance under a PIP, the court said.

Fourteen other former employees can’t participate in the proposed class action because they agreed to arbitration when they signed separation agreements, Caproni said.

The agreements are missing, she said. But there was “absolutely no evidence of bad faith on the part of IBM,” so the failure to produce the agreements was excused, the judge said.

IBM instead produced the standardized separation agreements in use when the various workers were terminated, Caproni said.

The workers didn’t dispute that those were the right agreements, the judge said.

They also didn’t dispute that each of the agreements included promises to arbitrate, and they admitted to signing the agreements, Caproni said.

Lichten & Liss-Riordan PC represents the workers. Jones Day represents IBM.

The case is Rusis v. Int’l Bus. Machs. Corp., 2022 BL 179235, S.D.N.Y., No. 1:18-cv-08434, 5/24/22.