Mistretta v. Sandia Corp.

Frank Mistretta and other former employees (the former employees) (plaintiffs) of Sandia Corporation (defendant) brought an action against Sandia alleging violations of the Age Discrimination in Employment Act (ADEA). Sandia was a scientific laboratory that primarily recruited employees on college campuses. Approximately 90 percent of Sandia’s new hires were younger than 40. However, this hiring pattern did not significantly differ from market expectations, and there was no evidence that people aged 40 to 65 (i.e., the ages protected by the ADEA) had more trouble obtaining employment at Sandia than the general applicant population. In the early 1970s, budget issues led Sandia to institute voluntary and involuntary layoffs. Although 15 percent of Sandia’s employees were between ages 54 and 64, 33 percent of the involuntarily terminated employees were between those ages. Statistical evidence also demonstrated that age became an increasingly important factor in Sandia’s termination-decision process beginning at age 52 and that employees between the ages of 52 and 64 were affected by Sandia’s termination decisions in an adverse pattern significantly differed from how other employees were affected. Evidence suggested that Sandia’s management and supervisors viewed older nonsupervisory employees as unproductive and unable to keep up with developing technologies. Sandia presented evidence that job performance was the main factor in its termination decisions. However, Sandia’s expert found that employees under age 40 tended to receive higher performance ratings. The evidence showed that Sandia’s performance-rating system was highly subjective and was not based on any specific criteria. The district court issued an order analyzing the age-discrimination claims.