Court Finds Early Retirement Incentive Discriminatory

April 12, 2010 ( – A federal court judge has found the Minnesota Department of Corrections violated federal age discrimination law by maintaining an early retirement incentive plan that offered different health and dental benefits for people under and over age 55.

U.S. District Court Judge Paul Magnuson held that the early retirement incentives are “facially discriminatory,” and as such violate the Age Discrimination in Employment Act, adding that an early retirement incentive plan cannot condition its benefits based solely on age, according to Minnesota’s Pioneer Press. Under the incentive plans, 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 get no such employer contributions toward health and dental coverage, the news report said.   

The judge 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.   

The U.S. Equal Employment Opportunity Commission (EEOC) filed the lawsuit after a former corrections department employee filed a charge with the agency. Six unions are also named as nominal defendants in the case.   

According to the news report, the Department of Corrections had argued in a motion for summary judgment that the EEOC could not show the department intended to discriminate, which, it said, is required in order to prove age discrimination in pension-related benefits under a U.S. Supreme Court ruling.