Court Agrees Early Retirement Incentive Plan Violates ADEA

August 11, 2011 ( – The 8th U.S. Circuit Court of Appeals has affirmed a lower court decision that an early retirement incentive plan offered by the Minnesota Department of Corrections is age discriminatory.

Under the ERIP, an employee who retired at age 55 would get employer contributions for health and dental insurance until age 65, but an employee who retired after age 55 would not. The appellate court agreed with a district court ruling that the early retirement incentives are “facially discriminatory,” and as such violate the Age Discrimination in Employment Act, and that an early retirement incentive plan cannot condition its benefits based solely on age. 

The district court judge had ordered that employees and former employees are entitled to damages in the amount of health and dental insurance premiums that the Department of Corrections would have paid if the illegal early retirement plan had not existed from 2001 to the present (see Court Finds Early Retirement Incentive Discriminatory).  

The case is Equal Employment Opportunity Commission v. Minnesota Department of Corrections, 8th Cir., No. 10-2699.