Opinion ID: 763119
Heading Depth: 3
Heading Rank: 2

Heading: Was he terminated as part of a reduction in force?

Text: 24 Godfredson disputes his employer's claim that he was discharged in connection with a reduction in force, specifically contending that he was replaced by two younger employees, Housewright and Moorman. This court in Barnes v. GenCorp Inc., 896 F.2d 1457 (6th Cir.1990), explained that determining whether a discharged employee is replaced is the key to deciding if the company has engaged in a valid reduction in force: 25 A work force reduction situation occurs when business considerations cause an employer to eliminate one or more positions within the company. An employee is not eliminated as part of a work force reduction when he or she is replaced after his or her discharge. However, a person is not replaced when another employee is assigned to perform the plaintiff's duties in addition to other duties, or when the work is redistributed among other existing employees already performing related work. A person is replaced only when another employee is hired or reassigned to perform the plaintiff's duties. 26 Id. at 1465 (emphasis added). 27 In support of his argument that he was replaced, Godfredson cites Tinker v. Sears, Roebuck & Co., 127 F.3d 519 (6th Cir.1997). Tinker was terminated from his employment at Sears as part of a reduction in force. Shortly thereafter, an existing Sears employee assumed Tinker's former duties. In changing the existing employee's status from part-time to full-time, Sears had to fundamentally change the nature of his employment ... in order to have him assume Tinker's duties in addition to his own. Id. at 522. This court held that the circumstances in Tinker were analogous to hiring a new employee to assume the duties of a discharged employee, and thus constituted replacement. See id.; see also Wilkins v. Eaton Corp., 790 F.2d 515, 521 (6th Cir.1986) (holding that the plaintiff was replaced when another employee was promoted from part-time to full-time and his new position required him to perform duties for which he had not previously been responsible). 28 The district court in the present case noted that Tinker has called Barnes into question. We disagree. Barnes holds that a person is not replaced when another employee is assigned to perform the plaintiff's duties in addition to other duties ... . 896 F.2d at 1465. Although the replacement employee in Tinker was an existing employee, he was analogous to a new hire in that his status shifted from part-time to full-time and his position had to be fundamentally changed. He did not assume additional tasks while continuing to perform his prior responsibilities. For these reasons, the Tinker court determined that the discharged employee had been replaced. See Tinker, 127 F.3d at 522. Although the court held that the facts before it in Tinker were analogous to those in Wilkins, it did not question the validity of Barnes. Tinker is simply an application of the analysis proposed in Barnes, and both cases must therefore be considered in determining whether Godfredson was replaced in the present case. 29 Contrary to the facts in Tinker, the record in the present case supports the district court's conclusion that Godfredson was not in fact replaced. Housewright and Moorman, both existing Hess & Clark employees, assumed Godfredson's duties after his discharge in addition to [their] other duties. They both maintained their prior job titles and responsibilities. Moreover, both of these men performed work related to that performed by Godfredson prior to the reduction in force. Godfredson was thus not replaced, making the reduction-in-force analysis the appropriate standard in the case before us. 30 Because Godfredson was terminated as part of a genuine reduction in force, he must establish that there was additional direct, circumstantial, or statistical evidence tending to indicate that the employer singled out [the plaintiff] for discharge for impermissible reasons in order to survive summary judgment. 31 3. Was there additional evidence indicating that the employer singled him out for discharge for impermissible reasons? 32 Godfredson argues that he was singled out for discharge for impermissible reasons. He claims that the other employees who were terminated as a part of the alleged reduction in force worked exclusively for KenVet Nutritional Care. In contrast, Godfredson worked for both KenVet Nutritional Care and KenVet, and his salary was allegedly derived solely from the latter's budget. He points out that he was the only employee working for both businesses who was terminated, and that he was older than any of the retained employees. Godfredson therefore argues that he was singled out for discharge, and that the reduction in force was used as a pretext to hide age discrimination. 33 The record, however, does not support Godfredson's claims. Godfredson devoted the majority of his time to KenVet Nutritional Care and held a position of significant responsibility in that division. Because both KenVet and KenVet Nutritional Care are owned by Hess & Clark, the precise source of Godfredson's salary is irrelevant. Furthermore, although he was older than the retained employees, more than half of the 18 other KenVet and KenVet Nutritional Care employees who were terminated as part of the reduction in force were less than 40 years of age. Godfredson therefore failed to satisfy this fourth prong of the prima facie framework under the ADEA. 34 4. Was the reduction in force pretextual? 35 Even if we concluded that Godfredson had established a prima facie case of age discrimination, he would still not prevail unless he could show that Hess & Clark's proffered reason for termination--the reduction in force--was pretextual. An employee can show pretext by offering evidence that the employer's proffered reason had no basis in fact, did not actually motivate its decision, or was never used in the past to discharge an employee. Smith v. Chrysler Corp., 155 F.3d 799, 805-06 (6th Cir.1998). 36 The district court held that Godfredson failed to make this showing, stating as follows: 37 Hess & Clark fired Godfredson because the plaintiff was director of marketing for a project that lost more than $10 million in less than three years. Eighteen employees besides the plaintiff also lost their jobs. Godfredson lacks evidence that age played a role in this decision. More than one-half of the employees discharged during the summer of 1995 were less than 40 years old. 38 We agree. The additional evidence that Godfredson presented on this point is legally irrelevant to the issue of whether the reduction in force was pretextual. First, he claims that an Ohio civil rights investigator stated that another Hess & Clark employee was threatened with an adverse job action if he said anything that would hurt the company. Because this statement is hearsay and not related to Godfredson's termination or the reduction in force, it cannot be considered in our summary judgment review. See U.S. Structures, Inc. v. J.P. Structures, Inc., 130 F.3d 1185, 1189 (6th Cir.1997) (stating that hearsay and irrelevant evidence must be disregarded in considering the response in opposition to a motion for summary judgment). 39 Second, Godfredson claims that he was isolated within the company, that he did not receive any prior warning of his termination, and that earlier performance reviews were withheld from him. None of these allegations, however, even if true, shows that Hess & Clark discriminated against him on the basis of age or that he was not terminated as part of a legitimate reduction in force. 40 Third, Godfredson contends that he was not permitted to transfer within the company or given the opportunity to sell the business in which he was involved. This court, however, has held that an employer has no duty to transfer an employee to another position within the company when the employer reduces the work force for economic reasons. See Ridenour v. Lawson Co., 791 F.2d 52, 57 (6th Cir.1986). And if an employee has no right to transfer within the company after a reduction in force, he or she certainly does not have the right to require that the eliminated business be sold. 41 Fourth, Godfredson argues that his termination saved Hess & Clark money in future pension costs. But this is the case whenever an employer terminates an employee, and provides no basis for establishing pretext. 42 Finally, Godfredson relies on Hillebrand v. M-Tron Industries, Inc., 827 F.2d 363 (8th Cir.1987), in which the court discussed several factors that might indicate that an alleged reduction in force is pretextual. These factors include general business improvement, a lack of evidence regarding a company's objective plan to carry out a reduction in force, and a situation in which only one or two management employees are aware of the reduction plan. See id. at 367-68. Godfredson claims that there is a genuine issue of material fact with respect to all of these factors in the present case. Even if we were to adopt these factors, however, Godfredson has failed to provide any factual support for his position because (1) the pet food company failed to make a profit, (2) there was evidence of an objective plan to carry out a reduction in force, and (3) there was testimony that at least three individuals participated in the plan to terminate numerous KenVet employees in connection with the reduction in force. An analysis of the Hillebrand factors is thus completely consistent with a genuine reduction in force, and there is no material evidence to the contrary. 43 For all of the above reasons, we agree with the district court's conclusion that Godfredson failed to raise a genuine issue as to whether Hess & Clark's reduction in force was pretextual. 44 5. Was he discriminated against with respect to severance pay? 45 As part of his ADEA claim, Godfredson also alleges that was discriminated against with respect to his severance pay. He specifically claims that he received lower severance pay than another Veratec employee, David New. New, he points out, served five or six years with Hess & Clark and then received six months salary as severance pay, whereas Godfredson served five years and received less than two months severance pay. Moreover, he argues that the conflicting testimony of Bookmyer and Moorman regarding the basis upon which the 1995 severance packages were calculated create[s] an inference that the articulated basis for the disparate treatment in severance pay is pretextual. 46 We find that the record does not support Godfredson's allegations. First, there is no evidence regarding New's age or contract terms at the time of his termination. Because he was not terminated as part of the 1995 reduction in force, Godfredson failed to establish that New was a similarly situated employee. A comparison of Godfredson's and New's severance packages is therefore irrelevant. Second, the July 12, 1990 letter agreement signed by Godfredson prior to his employment with Hess & Clark clearly stated that he would receive 12 months severance pay if he was terminated during the first two years of employment. Because Godfredson was terminated in 1995, five years after his start date at Hess & Clark, he was not due any severance pay at all. Third, Godfredson conceded in his deposition that he was aware of only two other individuals who had been offered severance packages as part of the 1995 reduction in force. He testified that these employees received severance packages that were the same as or smaller than his own. Finally, the conflicting testimony regarding the calculation of the severance pay is insufficient to raise a genuine issue of material fact on this claim. Godfredson's allegations of discrimination on the basis of severance pay are therefore without merit. 47