Opinion ID: 3010384
Heading Depth: 2
Heading Rank: 1

Heading: application of the adea tenure exemption

Text: The ADEA generally prohibits employers from discharg[ing] any individual or otherwise discriminat[ing] against any individual with respect to his compensation, terms, conditions, or privileges of employment, because of such individual's age. 29 U.S.C. S 623(a)(1). There is no question that both Halpin and Courtney were discharged or otherwise discriminated against because of their age: both were required to retire solely because they were seventy years old. La Salle contends, however, that the mandatory retirements were legal because of a then-existing exemption under the ADEA which provided: Nothing in this chapter shall be construed to prohibit compulsory retirement of any employee who has attained 70 years of age, and who is serving under a contract of unlimited tenure (or similar arrangement providing for unlimited tenure) at an institution of higher learning. 29 U.S.C. S 631(d) (1993) (repealed by P.L. 99-592, S 6(b)). Because the ADEA does not define contract of unlimited tenure, we look to interpretation of the exemption in the EEOC's regulations, 29 C.F.R. S 1625.11. Levine v. Fairleigh Dickinson Univ., 646 F.2d 825, 831 (3d Cir. 1981) (deferring to EEOC interpretation of tenured faculty exemption); Crozier v. Howard, 11 F.3d 967, 971 & n.4 (10th Cir. 1993) (same). _________________________________________________________________ 2. Because we remand his mandatory retirement claim, we leave the disposition of his part-time employment claim to the district court without expressing a view on the merits of the court's earlier ruling on that issue. As for Courtney's claim, it is in any event barred by the statute of limitations. 6 Unlimited tenure, according to the EEOC, means an arrangement under which certain appointments in an institution of higher education are continued until retirement for age o[r] physical disability, subject to dismissal for adequate cause or under extraordinary circumstances on account of financial exigency or change of institutional program. Adopting that definition, it is evident that the word unlimited refers to the duration of tenure. Therefore, a contract (or other similar arrangement) which is limited to a specific term (for example, one year or 10 years) will not meet the requirements of the exemption. 29 C.F.R. S 1625.11(e)(1) (emphasis added). The requirement that the contract (or similar arrangement) be for unlimited tenure is essential to the exemption, even if traditional protections of tenure3 are extended during the limited term of appointment: Employees who are not assured of a continuing appointment either by contract of unlimited tenure or other similar arrangement (such as a state statute) would not, of course, be exempted from the prohibitions against compulsory retirement, even if they perform functions identical to those performed by employees with appropriate tenure. Id. S 1625.11(f) (emphasis added). The EEOC also instructs that the elements of unlimited tenure must be clearly and unmistakably met, and that this exemption must be narrowly construed. Id. S 1625.11(b). The district court found that Professor Halpin was afforded the protections of tenure under the 1940 AAUP Statement. It further held, however, that La Salle could not _________________________________________________________________ 3. The regulation separately defines what tenure means by reference to the 1940 American Association of University Professors (AAUP) Statement of Principles on academic tenure. The 1940 AAUP Statement requires that any appointment be in writing, mandates academic freedom, defines a procedure governing termination for cause, and requires that any financial exigency (justifying termination) be bona fide. Id. S 1625.11(e)(2). The absence of any of these factors does not preclude a finding of tenure under the ADEA exemption. Id. S 1625.11(e)(3). 7 establish compliance with the exemption because the decision of the state appellate court established that the term of Halpin's contracts was for one year only. We agree. Because Halpin was not assured of a continuing appointment either by contract of unlimited tenure or other similar arrangement (such as a state statute), 29 C.F.R. S 1625.11(f), the exemption does not apply. We must give the state court's judgment the same effect it would have in the Pennsylvania state courts. Mosley v. Wilson, 102 F.3d 85, 92 (3d Cir. 1996). Collateral estoppel, sometimes referred to as issue preclusion, operates to prevent a question of law or an issue of fact which has once been litigated and adjudicated finally in a court of competent jurisdiction from being relitigated in a subsequent suit. Ammon v. McCloskey, 655 A.2d 549, 553 (Pa. Super. Ct. 1995). Under Pennsylvania law, . . . a prior determination of a legal issue is conclusive in a subsequent action between the parties on the same or a different claim when (1) the issue was actually litigated; (2) the issue was determined by a valid and final judgment; and (3) the determination was essential to the judgment. O'Leary v. Liberty Mut. Ins. Co., 923 F.2d 1062, 1065-66 (3d Cir. 1991). The duration of Halpin's contract was the sole issue before the state court: Here, none of the parties contend that employment was at will. There is dispute, however, regarding the length of the term for which employment was contracted. Halpin v. La Salle Univ., 639 A.2d 37, 39 (Pa. Super. Ct. 1994). The state court accepted La Salle's argument that employment as a member of the faculty was year by year, id. at 38, and held that while Halpin was guaranteed the rank of professor for the rest of his life, the duration of employment in each contract was for a period of one academic year. Id. at 40. La Salle contends that it does not seek to re-litigate issues decided in the state court because it seeks only to establish the meaning of the term academic tenure, which it says was not an issue in the state court litigation. To this end, La Salle argues that Halpin was guaranteed continued 8 employment based on the University's Faculty Handbook. The Handbook states: La Salle University subscribes to the principle of academic tenure, that is, title to continued employment. . . . The full-time teacher under contract with tenure may competently expect to hold his/her position until he/she is retired for age or permanent disability or separated for adequate cause under due process or because of financial exigencies of the institution. But we need not decide whether the Handbook gave Halpin a contract of unlimited duration (subject, of course, to mandatory retirement or dismissal for cause or forfinancial exigency): the state court has decided the issue. The Pennsylvania Superior Court held that because the contracts were clear and unequivocal on the subject of duration, no extrinsic evidence would be permitted to vary their meaning. Halpin, 639 A.2d at 39-40. And since 29 U.S.C. S 631(d) requires a contract or similar legal obligation (e.g., a statute, 29 C.F.R. S 1625.11(f)) to guarantee continued employment, it is no defense that Halpin, as La Salle now asserts, had some sort of amorphous expectation that his contract would be renewed. La Salle appears to argue that the state court could have decided the case in its favor without reaching the issue of the duration of the contracts, by holding only that Halpin had no right to continued employment past age seventy. While the state court could have construed the evidence of the parties' intent, including the Faculty Handbook, as guaranteeing continued employment up to age seventy, it did not decide the case on that basis. We have previously rejected the notion that an issue is not essential if, under some hypothetical resolution of the dispute, the issue could have been avoided. O'Leary, 923 F.2d at 1067 (3d Cir. 1991) (applying Pennsylvania law). The state court held that the only contract between Halpin and La Salle specified a period of employment of one academic year, and held that extrinsic evidence was inadmissible to prove that La Salle was obligated to more. Halpin, 639 A.2d at 39-40. These 9 determinations were not dicta, but were essential to the holding of the case and are binding here. Because at the time of Halpin's retirement, La Salle's contract with him was limited to a term of one year, the ADEA exemption did not apply. Accordingly, the district court was correct in rejecting La Salle's claim to the ADEA exemption for contracts of unlimited tenure.