Westinghouse Wins 7-Year-Old Age Bias Suit

PHILADELPHIA — Westinghouse Electric Co., which offered to settle an age discrimination lawsuit two years ago for $35 million, has won the case in federal appeals court.

The ruling Thursday, which was facilitated by a recent U.S. Supreme Court decision, ended a court battle that began in 1983, when the federal Equal Employment Opportunity Commission accused Westinghouse of forcing laid-off employees to retire before 70 because severance pay was unavailable.

The settlement offer, which would have given some 4,000 retirees an average payment of $8,750, was rejected by government lawyers because they believed that the workers would get more in court.

The U.S. 3rd Court of Appeals last year found Westinghouse guilty of age discrimination on grounds that workers couldn’t get both retirement and severance benefits when forced to retire before 70.

However, the Supreme Court vacated the decision and sent the 7-year-old case back for review. The appeals court reversed itself after becoming aware of new standards that the high court set in another age discrimination case involving employee benefit plans.

“The choice between retirement and unpaid layoff doesn’t constitute involuntary retirement where, as here, continued work was not an option for any of the affected employees and the employees’ layoff status was unrelated to age,” Judge Anthony Scirica wrote.

“Nor do we believe that exclusion from the severance plan caused older employees to retire. Those who retired did so because they were laid off.

“Moreover, after 1982, retirement-eligible employees could choose between retirement benefits and severance pay with recall,” the court said.

This was not the government position when it sued Westinghouse.

EEOC lawyers had contended that Westinghouse violated federal law by forcing laid-off employees under 70 to retire. Choosing retirement prevented the workers from receiving severance pay, EEOC said. It also contended that, by retiring, employees forfeited the chance to be recalled to work.