Opinion ID: 196227
Heading Depth: 1
Heading Rank: 1

Heading: The OWBPA

Text: 2 Congress enacted the ADEA in 1967 to prohibit age-based discrimination in the terms, conditions, or privileges of employment. 29 U.S.C. Sec. 623(a). The law originally contained an exclusion for employee benefit plans, providing that an employer could continue to observe the terms of ... any bona fide employee benefit plan such as a retirement, pension, or insurance plan, which is not a subterfuge to evade [ADEA's] purposes. Id. Sec. 623(f)(2). The Department of Labor, and, later, the Equal Employment Opportunity Commission (EEOC), interpreted this provision to require that age-based distinctions in benefit plans be cost-justified in order to qualify for the shelter of the exclusion. See 29 C.F.R. Sec. 1625.10 (1988). When confronted with the issue, the Supreme Court expanded the safe haven. It held that, under the ADEA, an employee challenging a benefit plan must prove that the discriminatory plan provision actually was intended to serve the purpose of discriminating in some non-fringe-benefit aspect of the employment relation. Public Employees Ret. Sys. v. Betts, 492 U.S. 158, 181, 109 S.Ct. 2854, 2868, 106 L.Ed.2d 134 (1989). 3 On October 16, 1990, Congress enacted the OWBPA and thus reconfigured the exclusion. The amendments placed employee benefits squarely within the protective custody of the ADEA, overturned Betts, and reinstated the earlier view that age-based distinctions in employee benefits must be cost-justified. Recognizing the potential implications of these changes for public employers, Congress stipulated that the OWBPA would not take effect as to states and their political subdivisions until two years after its passage. See OWBPA Sec. 105(c). Moreover, in grappling with the question of retroactivity, Congress decreed that the OWBPA would not apply at all to a series of benefit payments made to an individual or the individual's representative that began prior to the effective date and that continue after the effective date pursuant to an arrangement that was in effect on the effective date.... Id. Sec. 105(e).