Sixth Circuit Holds that Disabled Retirees Not Protected by Title I of the ADA

The Sixth Circuit picked a side this week in a circuit split about whether retirees are covered by Title I of the ADA in McKnight v. General Motors. The plaintiffs in this case retired from General Motors early and then later became disabled, before they reached the normal retirement age. Their pension plans provided that if they became eligible for social security disability benefits before they reached normal retirement age, their pension benefits would be reduced by the amount of social security disability benefits they received. The plaintiffs argued that reducing their benefits because they became disabled violated Title I of the ADA.

The court agreed with the Seventh and Ninth Circuits that retirees were not covered by Title I, reasoning that only "qualified individuals with disabilities" were covered, and that an individual is qualified only if the individual "can perform the essential functions of the employment position that such individual holds or desires." This language, all in the present tense, led to the conclusion that Congress had put temporal limiations on the definition of covered individuals, suggesting that these individuals had to be current employees or applicants, not former employees--at least not former employees who no longer desired to work, which is what the retirees in this case were. That temporal limitiaton distinguished Title I of the ADA from Title VII, which the Supreme Court had held did cover former employees in Robinson v. Shell Oil Co.

On the other side of the split are the Third and Second Circuits, which held that the ADA explicitly prohibits discrimination in the provision of fringe benefits, some of which only become possible after an employee retires. To give effect to this language, those courts reasoned that Congress must have meant to include former employees in the definition of covered individuals.

Based on the language of the Act and its purpose to increase employment opportunities for people with disabilities, the Sixth Circuit seems to be on solid ground finding that at least employees who retire and then later become disabled were not meant to be covered by Title I of the ADA. These just aren't individuals who desire work but are being denied it based on stereotypes. And the injury here doesn't seem to be the kind of thing that the ADA was designed to prevent. The core purpose of the ADA was to promote the employment of people with diabilities. Additionally, the reason for this employer policy seems analagous to disability insurance or workers' compensation principles, where a total amount of income is ensured, but the income from the employer source is offst by the income from the other source of benefits. There is an appeal of consistency there.

There is one glaring problem with the Sixth Circuit's opinion, though, that the federal courts geek in me is compelled to analyze. The court frames the issue as one of standing, explicitly concluding "that former disabled employees do not have standing under Title I of the ADA." In framing the issue as one of standing, the Sixth Circuit conflated the merits of coverage with the constitutional, jurisdictional question. Clearly, these plaintiffs have standing because they suffered an injury--their benefits from the plan were lower than they would have been had the plaintiffs not become disabled. They have something real at stake that a judgment could remedy. That is standing for purposes of Article III. These plaintiffs' problem instead was that their injury was not legally cognizable. They had no cause of action under the statute. That's a merits issue.

MM