United States Court of Appeals,
Fifth Circuit.
No. 95-10586.
EQUAL EMPLOYMENT OPPORTUNITY COMMISSION, Plaintiff-Appellant Cross-Appellee,
v.
TEXAS INSTRUMENTS INCORPORATED, Defendant-Appellee Cross-Appellant.
Dec. 10, 1996.
Appeals from the United States District Court for the Northern District of Texas.
Before KING, JONES and SMITH, Circuit Judges.
EDITH H. JONES, Circuit Judge:
The Equal Employment Opportunity Commission ("EEOC") appeals the district court's
summary judgment to Texas Instruments, Inc. ("TI") o n the merits of the EEOC's claims that six
manufacturing supervisors were discharged as part of a company reduction in force because of their
age. EEOC asserts that a combination of favorable employee performance reviews and a special
company RIF policy, three age-related comments and workforce statistics created an inference that
TI's legitimate, nondiscriminatory reasons for the employment decisions were pretextual for age
discrimination. Texas Instruments, Inc. cross-appeals the district court's orders preventing it from
raising a limitations defense. This court AFFIRMS.
BACKGROUND
Sweeping cutbacks in national defense spending and dramatically reduced procurements by
the United States Department of Defense forced TI to reorganize its Defense Systems and Electronics
Group ("DSEG") to lay off approximately 850 out of 1700 DSEG manufacturing employees between
1988 and 1994. EEOC studied many of the layoffs but attempted to make a case for illegal
discrimination only in regard to six manufacturing supervisors in the DSEG (the "Six Supervisors"),
victims of TI's reduction in force, who were protected by the Age Discrimination in Employment Act
of 1967 ("ADEA"), 29 U.S.C. § 623(a). As a "manufacturing supervisor," each of the men
represented by the EEOC is a first-level supervisor who directly oversees hourly workers and reports,
in turn, to various levels of management. In December 1993, EEOC filed suit on behalf of Hugh
Calhoun (age 54), Walter Morrow (age 59), Allen Powell (age 56), Gaylon Rains (age 51), Jerry
Owens (age 50), and Vernon Hillis (age 51).
Voluminous deposition testimony and other evidence were submitted by the parties. The
evidence shows that TI's RIF at DSEG was planned and implemented by Stephen Douthit
("Douthit"), the head of DSEG's manufacturing division. Douthit testified that he began the RIF by
assessing both the current levels of staffing in relation to anticipated product demand and the relative
ability of DSEG employees to satisfy and adapt to a rapidly changing technological environment.
These assessments led Douthit to conclude that while TI should lay off its hourly employees in order
of seniority, manufacturing supervisors should be assessed independently of their seniority. Douthit
acknowledged that the decision not to consider seniority in the RIF of manufacturing supervisors was
a significant departure from TI's traditional policy favoring senior employees.
Because abandoning the protections of seniority was such a departure, Douthit presented this
suggestion to Jerry Junkins, president and CEO of TI, and Hank Hayes, the president of DSEG.
Douthit argued that TI's policy favoring senior employees would impose significant costs on the
company, as supervisory staff was concentrated in high pay grades. Furthermore, unwavering
commitment to seniority promised a reorganized workforce that would not have the contemporary
skills necessary to assimilate new technologies.1 If seniority preferences were maintained, the RIF
would terminate a disproportionate number of employees with college degrees, as many senior
employees had acquired their skills primarily through experience. TI management concurred with
Douthit and decided to assess manufacturing supervisors independently of their seniority. The goal
of this decision, according to management, was t o provide TI with the technical expertise and
flexibility to serve its current and future customers in an era of dynamic technological progress.
1
TI argues that older employees at DSEG tended not to have state-of-the-art technological
training, observing that the older "supervisors who had learned their skill on-the-job through their
former positions as machinists, found themselves with dated skills unless they kept abreast of the
new computer-based production methods." Joe Dial, site manager at a TI manufacturing facility,
concurred and concluded in a two-page assessment to Douthit that TI's future operations
demanded supervisors with enhanced capabilities in statistics and experimental design.
Not only did TI eschew reliance on seniority in its RIF of the manufacturing supervisors, it
also did not consider either performance evaluations or the company's Key Personal Assessments
("KPAs"). The performance evaluations did not aid in deciding which employees to terminate and
which to retain because the evaluations were not designed to make fine distinctions among employees
or to rate them comparatively; with rare exceptions, the evaluations clustered ratings tightly around
the group median. Likewise, TI rejected the KPAs, top-to-bottom rankings of salaried employees
in a TI department, because these assessments normally correlated an employee's rating with his pay
schedule; in different terms, highly paid employees invariably received highly rated KPAs.2 The KPA
rankings thus did not provide TI with useful information concerning which cross-section of employees
it should retain.
Considering neither a supervisor's seniority nor his performance evaluation or KPA, TI began
the difficult process of conducting a RIF among its 45 supervisors. Nine were ultimately terminated
and two were demoted; EEOC did not file suit on behalf of three of the employees who were over
40. Regarding the Six Supervisors represented by the EEOC, TI contends that their terminations
were not motivated by their ages but, instead, can be explained by legitimate, individualized reasons.
A brief summary of these reasons follows:
Powell and Morrow: TI asserts that Powell and Morrow, both manufacturing supervisors
at the Precision Automation Center, were discharged because their skills were inferior when
compared to Billy Wooley ("Wooley"), a third manufacturing supervisor who was retained during
the RIF. Lewis Horn, head of the Precision Automation Center, decided to consolidate the
responsibilities of the three supervisors in a single position. Horn testified that he concluded that
Powell had only a basic knowledge of computer-based numeric control programming and was
reluctant to learn new manufacturing technology. Horn also opined that Morrow lacked the requisite
motivation and initiative to perform as the sole supervisor; Horn felt that although Morrow was the
supervisor in the highest pay level, his performance was incommensurate with this level. Horn
2
While this result is hardly counter-intuitive, TI suggests that many of the employees who
received high marks on their KPAs actually performed deficiently.
"would expect more out of a job grade 30 than the responsibility he had.... [and would expect him
to go] outside and actively solicit[ ] other responsibilities besides just what he had with production
control."
Wooley, by contrast, possessed the technical as well as management skills to function
effectively as the consolidated supervisor; Horn observed that Wooley kept excellent contact with
clients, formulated customer proposals efficiently, and had extensive knowledge of TI's
computer-based production planning systems. Because Horn considered Wooley the best candidate
for the consolidated position, he was retained as the sole supervisor:
Billy Wooley was an outstanding employee who was quite knowledgeable regarding TI's
computer-based production planning systems. Powell and Morrow were not as proficient in
these areas. Additionally, Wooley was good at keeping close contact with customers, and
talented at formulating customer proposals. Thus, I determined that the work in the ... shop
could be best consolidated by retaining Adrian and Wooley and laying off Powell and
Morrow.
Calhoun: TI terminated Calhoun when it closed its Trinity Mills facility, where Calhoun had
been employed.3 Much of the machinery and the machining work at Trinity Mills was transferred to
TI's Lemmon Avenue facility when Trinity Mills was closed in October, 1990. At Trinity Mills,
Calhoun had been in charge of the tool shop and was responsible for the fabrication of certain tools
for use by other TI employees. But the Lemmon Avenue facility had a much larger tool shop
operation that was already adequately staffed. Because there were no vacant positions in which
Calhoun could serve TI and because no "bumping" of other supervisors was permitted under TI's RIF
policy, he was fired.
Rains: TI acknowledges that Rains, the only manufacturing supervisor laid off from Lemmon
Avenue, was terminated because of his poor performance. TI demanded that a supervisor such as
Rains be proficient in three areas: computer programming, because the product is computer
designed; the machining process; and knowledge of the machine tools that perform the work.
Robert Anderson, to whom Rains reported, testified that Rains was lacking in all three areas and was
3
During his deposition, Joe Dial explained that TI intended to close down or significantly
downsize operations in at least three TI facilities: Trinity Mills, Colorado Springs, and the North
Building.
seriously hampered in his ability to perform as a supervisor. Anderson reinforced these criticisms in
an affidavit that
[Rains] had an inadequate knowledge of machinery, and he had little knowledge of the
machine tools he was supervising technicians to repair. These deficiencies are significant,
because if a part is not manufactured to specification, as happens occasionally but predictably,
a supervisor such as Rains must determine whether the fault lies with the computer program,
the machine, or the machine part. Rains' skills and experience were such that I could not trust
his judgment in these regards to the same degree as other manufacturing supervisors.
Because of his poor performance, Rains failed to receive a salary increase in 1990. Rains
protested his salary stagnation to Douthit who, after personally investigating the issue, concluded that
Rains did perform below par.4 Douthit testified that his
conclusion was and what I told Gaylon that he did, in fact, have a performance problem, and
you know, there was sufficient evidence that he had actually been sleeping on the job.... So
our agreement was that he was going to go forth and fix, you know, work on the problems
that had been laid out to him and, you know, see if he could correct, you know, some of the
deficiencies that had been pointed out to him.
Owens: Owens was employed as a supervisor at the Lewisville model shop at the time of his
layoff. TI contends that he was terminated because of his lack of technical knowledge in machining
and his inadequate communication skills. Mark Cooper, Owens's former supervisor, testified:
Owens' primary deficiency was that he had minimal technical and machining knowledge.
Further, Owens was lacking basic "people skills' and was found to be abrasive in his dealings
with other personnel.... Because o f Owens' deficiencies, he was not as critical as other
manufacturing supervisors in a time of business decline and was, therefore, laid off.
Hillis: TI stated that it terminated Hillis because he lacked high tech skills and interact ed
poorly with other employees. Hillis lost his job when TI closed the model shop in TI's North Building
and consolidated at the Lewisville and McKinney sites. Peter Loughlin, a manager in DSEG, testified
that he considered Hillis to be
the weakest [supervisor] in the North Building model shop. He was employed in a rapidly
changing "high tech' environment. Hillis showed little motivation to learn the software
packages that were available on the computer.... I considered him someone who shunned,
rather than sought out, such challenges. Hillis' chief shortcoming was the manner in which
he interacted with the other shift supervisors.... Hillis typically did not arrive in advance of
his shift to learn from the second shift supervisor how operations were proceeding, or if any
problems were "hot' and required special attention.
4
Rains in fact received the lowest performance rating of any of the 45 manufacturing
supervisors on the performance evaluation conducted prior to the layoff.
Hillis admits that he is not technologically sophisticated and that he regarded himself primarily
as a machinist; he testified at his deposition that "I'm not all that educated. I've been around
machining, and that doesn't interface with computers and so forth." Hillis also described his computer
capabilities as "[z]ero." Although TI concedes that Hillis was a satisfactory employee, it concluded
that he was expendable in the RIF.5
In response, the EEOC argues that the particularized rationales suggested by TI are merely
pretexts for age discrimination. EEOC refers to "statistical, anecdotal, and other circumstantial
evidence to permit a reasonable factfinder to conclude that age was a factor in the discharge
decisions...."
The statistical evidence on which the EEOC relies was compiled by Dr. John G. Claudy
("Claudy"). Claudy analyzed data provided by TI to determine whether there was a statistically
significant relationship between age and the likelihood that a supervisor would be terminated. In part,
Claudy calculated that while TI had discharged 38.9% of the manufacturing supervisors age 50 and
older, the company had terminated only 7.4% of the supervisors under age 50. After conducting
three alternative statistical tests Claudy concluded that there was a statistically significant relationship
between age and discharge to the disadvantage of supervisors over fifty. Claudy admitted that his
analysis did not consider the specific talents or duties of the manufacturing supervisors.
In addition to the statistical suggestion of age discrimination, the EEOC urges that TI's
departure from its traditional seniority protections as well as its decision to ignore performance
evaluations and the KPAs facilitated age discrimination. TI's RIF policy directed that the first
employees t o be discharged would be those on disciplinary probation, followed by those who had
unsatisfactory evaluations, then volunteers, and finally, those with lower job criticality rankings.
None of the Six Supervisors had been on disciplinary probation; none had received an unsatisfactory
rating on his previous performance evaluation; and TI did not develop a "criticality ranking" of the
supervisors before implementing the RIF, though its RIF policy required such a ranking. The EEOC
5
Loughlin concluded that "[w]hile Hillis' performance would have permitted him to remain
employed had business remained at appropriate levels, the downturn in business required me to
designate the weakest performer in my group, which was Hillis."
asserts that TI's departure from its established RIF procedures and its decision to ignore previous
formal evaluations of the supervisors constitute evidence that the company intentionally discriminated
against the Six Supervisors because of their ages.
The EEOC further contends that three age-based comments by TI managers articulate the
company's discriminatory intent. Fred Blair, a TI personnel director but not a decisionmaker,
explained to Rains when Rains was informed of his termination that "it's just that you've reached that
age and years of service that we can bridge you to retirement." The remaining two comments were
allegedly directed to Casimir Tencza ("Tencza"), another supervisor discharged in the RIF. Tencza
was allegedly told that he was laid off in part because TI "had to make room for some of the younger
superviso rs" and that "his age got him." Importantly, however, Tencza is not represented by the
EEOC and has settled his claim against the company. From these statements, the EEOC seeks to
imply discrimination by TI directed against its older employees.
Finally, the EEOC questions the particularized explanations suggested by TI for firing the Six
Supervisors. A brief summary of the EEOC's criticisms contrasts the agency's position with that of
TI:
Powell and Morrow: The EEOC stresses that both Morrow and Powell had outstanding
performance evaluations. Further, Morrow enjoyed extensive technical skills, while Powell was
evaluated as consistently generating a profit for TI while maintaining customer satisfaction.
Calhoun: Calhoun received superior ratings in his performance evaluations in the areas of
"job knowledge" and safety. Also, Calhoun was doubtlessly technically competent and, while at
Trinity Mills, had supervised some of the machinery that was later transferred to Lemmon Avenue
when the Trinity Mills facility closed.
Rains: Although the EEOC concedes that Rains was the sole discharged supervisor who
received a poor performance evaluation, it contends that during his exit interview, Rains was assured
by Dial, one of his supervisors, that he had been a "good performer." Further, as noted earlier, Rains
was allegedly told by Blair that he had "reached that age and years of service that we can bridge you
to retirement."
Owens: Owens received a favorable performance evaluation that praised his communication
skills and described him as a cooperative and respected employee. In these evaluations, Owens never
fell below the "benchmark level of performance" necessary to satisfy his job requirements.
Hillis: Contrary to TI's suggestion that Hillis lacked technical expertise, the EEOC
emphasizes that his evaluations indicated that he had a thorough knowledge of his technical duties.
For instance, in his most recent performance review, Hillis received superior ratings in evaluations
of his job quality, knowledge, and safety.
After their terminations, four of the Six Supervisors—Morrow, Powell, Rains and
Calhoun—filed their charges of discrimination with the EEOC on June 21, 1991; neither Owens nor
Hillis filed charges with the agency. As previously noted, the EEOC filed suit on behalf of the Six
Supervisors on December 3, 1993.
TI answered the lawsuit and later moved for leave to file its first amended answer, seeking
to add as an affirmative defense that the EEOC's claims were untimely under the relevant statute of
limitations. TI soon moved for summary judgment on that ground. In January, 1995, TI filed an
additional motion for summary judgment on the merits of the EEOC's claims. The district court
granted summary judgment on the merits but denied TI's motions for leave to amend and for summary
judgment on limitations. Each side has appealed the rulings unfavorable to it.
DISCUSSION
A. Standard of Review
This court reviews de novo the district court's grant of summary judgment, employing the
same criteria used in that court. Burfield v. Brown, Moore & Flint, Inc., 51 F.3d 583, 588 (5th
Cir.1995). Summary judgment is proper only "if the pleadings, depositions, answers to
interrogatories, and admissions on file, together with the affidavits, if any, show that there is no
genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of
law." Fed.R.Civ.P. 56(c). Factual questions and inferences are viewed in the light most favorable
to the nonmovant. Lemelle v. Universal Mfg. Corp., 18 F.3d 1268, 1272 (5th Cir.1994).
Although Rule 56(c) requires the moving party to demonstrate the absence of a genuine issue
of material fact, a dispute about a material fact is genuine only if the evidence is such that a reasonable
jury could return a verdict for the nonmovant. See Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106
S.Ct. 2548, 2552, 91 L.Ed.2d 265 (1986); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106
S.Ct. 2505, 2510, 91 L.Ed.2d 202 (1986). If the moving party demonstrates the absence of a genuine
issue of material fact, then the nonmovant is burdened with establishing the existence of a genuine
issue for trial. Matsushita Elec. Indus. Co. v. Zenith Radio, 475 U.S. 574, 585-87, 106 S.Ct. 1348,
1355-56, 89 L.Ed.2d 538 (1986). This burden requires the nonmovant to do more than merely raise
some metaphysical doubt as to the material facts. Matsushita, 475 U.S. at 586, 106 S.Ct. at 1355.
B. Demonstrating Pretext
TI acknowledges and the district court assumed that the EEOC established a prima facie case
of discrimination against the Six Supervisors simply by showing that they were over 40, and were
discharged, while younger supervisors remained on the payroll. Meinecke v. H & R Block Income
Tax School, Inc., 66 F.3d 77, 83 (5th Cir.1995). TI utilized its opportunity through affidavits and
depositions to explain the legitimate, nondiscriminatory reasons for each adverse employment action.
The burden then fell on EEOC to raise a genuine, material fact issue that those reasons were not the
real reasons and were pretexts for age discrimination. Id. As the district court concluded that
EEOC's evidence did not discharge its burden, summary judgment was granted. The court held:
[t]he EEOC has failed to demonstrate a genuine issue for trial about the legitimacy of the
nondiscriminatory reasons given by TI for the discharge of the [S]ix [S]upervisors. The three
theories set forth by the EEOC which, it argues, show a pretext for age discrimination are
either not supported by the evidence or are not sound legally. The court concludes that no
genuine issue of material fact exists on the question of whether TI intended to discriminate
against the supervisors.6
Sitting en banc, this court recently discussed the burden confronting an ADEA plaintiff who
seeks to demonstrate that an employer's proffered rationales for adverse employment acts were
merely pretextual and that discrimination based on age was an actual reason for these adverse acts.
In Rhodes v. Guiberson Oil Tools, 75 F.3d 989 (5th Cir.1996) (en banc ), this court explained that
6
The "three theories" to which the district court referred involved the efforts of the EEOC to
demonstrate pretext through the use of (1) age-related comments; (2) TI's conscious failure to
follow its own RIF procedures; and (3) statistical evidence of age discrimination. EEOC also
contested the veracity of TI's reasons for each individual termination.
the plaintiff in an ADEA disparate treatment case must offer evidence to rebut each of the employer's
articulated legitimate, nondiscriminatory reasons. The court reasoned that
[i]n tandem with a prima facie case, the evidence allowing rejection of the employer's
proffered reasons will often, perhaps usually, permit a finding of discrimination without
additional evidence. Thus, a jury issue will be presented and a plaintiff can avoid summary
judgment and judgment as a matter of law if the evidence taken as a whole (1) creates a fact
issue as to whether each of the employer's stated reasons was what actually motivated the
employer and (2) creates a reasonable inference that age was a determinative factor in the
actions of which the plaintiff complains. The employer, of course, will be entitled to summary
judgment if the evidence taken as a whole would not allow a jury to infer that the actual
reason for the discharge was discriminatory.
Rhodes, 75 F.3d at 994 (emphasis added). Whatever evidence a plaintiff tenders must rebut each of
the employer's proffered rationales:
[I]n some cases, for instance, the fact that one of the nondiscriminatory reasons in the record
has proved to be highly questionable may not be sufficient to cast doubt on the remaining
reasons. Likewise, an employer's explanation for its proffer of a pretextual reason may
preclude a finding of discrimination.
Id. at 994 (citing Woods v. Friction Materials, 30 F.3d 255, 261 n. 3 (1st Cir.1994)) (concluding that
a jury could not infer age discrimination if the proffered reason was in fact a pretext, though not for
discrimination).
There is another wrinkle on the standards for evaluating discrimination. In the context of a
reduction in force, which is itself a legitimate, nondiscriminatory reason for discharge, the fact that
an employee is qualified for his job is less relevant—some employees may have to be let go despite
competent performance. Walther v. Lone Star Gas Co., 952 F.2d at 124. If, however, the older
employee shows that he was terminated in favor of younger, clearly less qualified individuals, a
genuine, material fact issue exists. Walther, 952 F.2d at 123.
C. The EEOC's Evidence of Pretext
(1) TI's Age-Based Comments
EEOC first relies on three age-related comments allegedly made by TI employees as proof
of TI's discriminatory motivation.7 Plaintiff Rains testified that Blair, a TI personnel director,
7
The district court found and analyzed only two statements, one allegedly made by Blair to
Rains, and the other directed at Tencza. On appeal, the EEOC points out that two separate
age-based comments were made to Tencza. Although the making of these comments is disputed,
we must assume that they were made for purposes of summary judgment.
explained the decision to terminate Rains by suggesting that "it's just that you've reached that age and
years of service that we can bridge you to retirement." The two remaining statements were allegedly
made by Horn to Tencza, a supervisor discharged in the RIF who is not represented by the EEOC.
Horn allegedly said of Tencza, "his age hot him," and that TI had to make room for younger
supervisors.
This court has repeatedly held that "stray remarks" do not demonstrate age discrimination.
See, e.g., Waggoner v. City of Garland, 987 F.2d 1160, 1166 (5th Ci r.1993) (a statement by a
decisionmaker that an employee was an "o ld ____" and that a younger person could complete his
work faster was a stray remark insufficient to establish age discrimination); Guthrie v. Tifco
Industries, 941 F.2d 374, 378-79 (5th Cir.1991) (holding that such "statements are too vague to be
accepted as direct evidence of age-bias."); Turner v. North American Rubber, Inc., 979 F.2d 55, 59
(5th Cir.1992) (vague and remote remarks cannot establish age discrimination). In order for an
age-based comment to be probative of an employer's discriminatory intent, it must be direct and
unambiguous, allowing a reasonable jury to conclude without any inferences or presumptions that age
was an impermissible factor in the decision to terminate the employee. Bodenheimer v. PPG
Industries Inc., 5 F.3d 955, 958 (5th Cir.1993).
The statement allegedly made by Blair to Rains is a stray remark that does not demonstrate
age bias. Blair's statement simply recognized a fact concerning Rains's seniority, an observation
which did not imply seniority was the reason for discharge. This interpretation of the statement is
consistent with the context in which it was allegedly made, as Rains's duty was to explain termination
benefit packages to employees. See, e.g., Guthrie, 941 F.2d at 378-79 (statement that founder of
company suggested to his son that he needed "to surround himself with people his age" is not direct
evidence of age discrimination); Turner, 979 F.2d at 59 (comment that an employee needed "three
young tigers" to assist with operations is not probative of discrimination). TI also notes that Blair
was not a decisionmaker at TI with respect to the RIF and that he had no input into the decision to
terminate any of the Six Supervisors. Blair's stray remark is thus not probative of whether TI's
decision to terminate Rains was motivated by age discrimination. See, e.g., Rhodes, 75 F.3d at 994;
Cone v. Longmont & United Hosp., 14 F.3d 526, 529 (10th Cir.1994) (age-related comment by
non-decisionmakers are not material to showing employer's age discrimination.)
Further, the statements allegedly made concerning Tencza's termination are not probative in
themselves or relevant to TI's decision to terminate the Six Supervisors. Horn, who allegedly make
the remarks, recommended replacing Tencza, age 55, with Garner, age 51, an action which speaks
louder about Horn's motivation than the words attributed to him. Moreover, the statement about TI's
need to make room for younger supervisors reflects the kind of truism this court and others have held
does not evidence discrimination. See, e.g., Birkbeck v. Manvel Lighting Co., 30 F.3d 507, 512 (4th
Cir.1994), cert. denied --- U.S. ----, 115 S.Ct. 666, 130 L.Ed.2d 600 (1994) (statement that "there
comes a time when we have to make room for younger people" creates no inference of age
discrimination). But even if Horn's alleged remarks were probative of discrimination against Tencza,
they cannot carry the heavier burden of condemning the motivation of TI toward the Six Supervisors:
Horn was a first-tier evaluator of layoffs whose recommendations had to be approved by Dial and
Douthit, and Horn was partly responsible for recommendations on only two of the Six Supervisors.
In short, the alleged statements about Tencza's termination are no more probative of disparate
treatment of the Six Supervisors than whatever was said to the numerous supervisors over 40 years
old whom TI did not discharge.8
(2) TI's Conscious Departure from its own Procedures
The EEOC urges that TI's conscious decision to ignore its usual policies and procedures when
conducting the RIF demonstrates that its expressed reasons for terminating the six supervisors are
post hoc pretexts for age discrimination. The district court rejected this inference, concluding that
the EEOC had not shown a discriminatory connection between TI's failure to follow its policies and
its selection of supervisors subject to the RIF.
8
Moreover, the cases on which the EEOC relies are distinguishable because the remarks in
those cases demonstrated discriminatory intent by the final decisionmaker in both the plaintiff's
and the third party's cases. See Shattuck v. Kinetic Concepts, Inc., 49 F.3d 1106, 1109 (5th
Cir.1995). Courts that allow statements about non-parties like Tencza to be used do so because
the discriminatory animus that motivated those comments provides circumstantial evidence of
discriminatory intent in the particular case; any possible inference of discrimination in this case is
far weaker and more remote from the decisionmaking process.
This court has observed that an employer's "disregard of its own hiring system does not of
itself conclusively establish that improper discrimination occurred or that a nondiscriminatory
explanation for an action is pretextual." Risher v. Aldridge, 889 F.2d 592, 597 (5th Cir.1989); see
also, Moore v. Eli Lilly & Co., 990 F.2d 812, 819 (5th Cir.), cert. denied, 510 U.S. 976, 114 S.Ct.
467, 126 L.Ed.2d 419 (1993). This court elaborated in Moore that
[p]roof that an employer did not follow correct or standard procedures in the termination or
demotion of an employee may well serve as the basis for a wrongful discharge action under
state law. As we have stated, however, the ADEA was not created to redress wrongful
discharge simply because the terminated worker was over the age of forty. A discharge may
well be unfair o r even unlawful and yet not be evidence of age bias under the ADEA. To
make out an ADEA claim, the plaintiff must establish some nexus between the employment
actions taken by the employer and the employee's age. [A] bald assertion that one exists ...
simply will not suffice.
Id. 990 F.2d at 819 (citing Bienkowski, 851 F.2d at 1508 n. 6).
The EEOC has not demonstrated such a nexus; rather, as in Moore, its argument rests on a
bald assertion that one exists. What happened in this case, without dispute, is that TI created a new
layoff policy regarding supervisors that disregarded seniority; the company did not simply fail to
follow the usual seniority-protective policy. As previously summarized, TI carefully outlined why
it disregarded the seniority protections typically afforded to its employees in a RIF and why it did not
consider performance evaluations or KPAs when determining which supervisors to retain. The EEOC
failed to undermine this decision. Specifically, Douthit testified at his deposition that under
pre-existing TI policy he was "not permitted to lay off individuals with more than 15 years of seniority
without gaining the approval of the president of the company." Douthit lamented that the economic
costs of the seniority policy were extreme since "the mix of [TI's] job grades was becoming more and
more concentrated towards the higher end, which was driving our average pay up, which was driving
our cost up, which was making us less competitive in the marketplace." Additionally, TI's seniority
rule would force TI to displace a disproportionate number of employees with college degrees since
"the majority of [TI's] degree people had less than 15 years of service while ... a high percentage of
people [had] greater than 15 years of service [but no] degrees." Instead of this expensive, inflexible
protection of seniority, Douthit favored a RIF policy which would make "those decisions on a merit
basis ... as opposed to, you know, a fixed set of rules that did not allow [TI] the flexibility to make
decisions that were dictated by business conditions."
Douthit advocated a merit-based retention policy to the CEO of TI and the president of the
DSEG o rganization. Douthit documented the present concentration of supervisors in higher pay
grades, the skills that TI most needed to retain in its RIF, and the senior employees who would be
discharged if seniority protections were waived. The company agreed to modify its traditional RIF
policy in part "[b]ecause technology had changed. [A] lot of high seniority people had skill sets that
were ... grounded in the 1960s and 1970s technology. Products of the future were going to require
1980s and 1990s technology. [Some senior employees] had not or could not ... make the transition
to those new technologies and required skills."
Before TI undertook the difficult task of selecting employees to terminate during its RIF, the
company reco gnized that its traditional protection of seniority would hamper future performance.
As a result, after identifying the skills most vital to the company's ability to adapt to a rapidly
changing technological environment, TI waived its seniority protections and laid off supervisors who
might have otherwise been retained because o f their seniority. TI's decision to replace a seniority
policy that would impede its ability to reduce its workforce while maximizing the efficiency and
expert ise of the remaining employees does not, without a clear nexus to discrimination, create an
inference of age discrimination.
(3) Criticisms of TI's Particularized Reasons
This court has already summarized the criticisms advanced by the EEOC of TI's reasons for
discharging each of the Six Supervisors. Rather than demonstrate t he likely falsehood of those
reasons, EEOC responds that each of the supervisors had competent performance evaluations and
KPAs and was considered an effective employee by TI. Critically, the EEOC's criticisms rest on
information found in TI's annual performance evaluations and its KPAs, measures which are
misleading guides to the RIF decisions TI had to make.
TI rejected use of the performance evaluations and KPAs after determining that neither report
provided worthwhile information about the comparative worth of a particular employee. Stephen
Leven ("Leven"), Vice President of Human Resources at TI, attested that
[t]he performance evaluations completed annually for TI's employees have tended to be quite
uniform. It was intended by TI that the vast majority of employees would receive similar
performance ratings, with only exceptionally good or poor performers deviating from this
norm. The purpose of this co mmon rating is to avoid making fine distinctions among
employees who are performing adequately when no pending business decisions turn directly
on such ratings.
For instance, of the 135 evaluations performed on a group of 45 manufacturing supervisors during
the three years preceding the RIF, only two evaluations gave a summary rating below the group
median.9 Another drawback of the performance evaluations is that they provide no useful information
regarding the ability of an employee to adapt to changing technology. Leven explained that
the written performance evaluations typically rate an individual with respect to the job he or
she currently performs, but are silent with respect to the value to TI of the job they are
performing, or the usefulness of their skills as applied to future operations and technology.
Given the tendency of these evaluations to cluster employee performance ratings and their lack of
focus on the company's future technological needs, TI had a legitimate business basis not to rely on
the evaluations in conducting its RIF.
The KPAs were also deficient for TI's RIF decisions. Leven explained that
[t]he KPA is performed annually and provides a "top to bottom" ranking of exempt
employees in each organization, including manufacturing operations, according to their
perceived value. The KPAs, however, are closely tied to salary determinations and reflect
considerations in addition to performance.
Indeed, the KPA rankings were often simply reiterations of the pay gradations at TI; the greater the
pay, the higher the KPA. Also, because they are merely top-to-bottom rankings, the KPAs do not
provide information about the proper mix of employees and specialties that should be retained in a
9
TI's management did not attempt to make fine distinctions between employees in the
performance evaluations. Whit Smith, an expert witness for TI, opined that
[a]n analysis of the 1988 and 1989 performance reviews for the forty-five
manufacturing supervisors reveals that there is not enough variance in the ratings
of these individuals to enable management to utilize these as a tool in making a
decision regarding the retention or layoff of any individual supervisor. With only
one exception, each manufacturing supervisor was rated by as his/her manager as
fully meeting or, in some cases exceeding, job requirements and performance
standards. This rating was consistently given to each manufacturing supervisor,
even in those few cases in which the need for improvement ... was identified
through the manager's comments. Managers appear to be reluctant to rate any
supervisor as not meeting expectations....
(emphasis added).
RIF. As Douthit explained in his deposition, it is "entirely conceivable that you could have somebody
that would be high on the KPA, you know, good performer, but may reside in a skill category that
was no longer or was not critical to the success of the business."
In sum, the EEOC's proof fails to undermine TI's legitimate, non-discriminatory, and
individualized reasons for terminating the Six Supervisors for several reasons. First, the agency
makes general assertions that the supervisors were competent employees, but it does not directly
challenge TI's individualized explanations for not retaining the Six Supervisors. The agency showed
only that the supervisors were qualified, not that they were clearly better qualified than the
supervisors retained in the RIF. See Walther, supra;10 see also EEOC v. Manville Sales Corp., 27
F.3d 1089, 1096 n. 5 (5th Cir.1994), cert. denied, --- U.S. ----, 115 S.Ct. 1252, 131 L.Ed.2d 133
(1995). Second, the EEOC's showing is premised on the performance evaluations and KPAs, data
irrelevant to the RIF decisions. Thus, while some of TI's criticisms of individual supervisors'
performances appear to be contradicted by the ratings and comments on their annual evaluations, the
record demonstrates that the annual evaluations were not designed to compare or differentiate among
employees, the critical task for management conducting a RIF. Third, the EEOC has not offered
proof to indict TI's logic for abandoning either the KPAs of the performance evaluations.
(4) Statistical Evidence
The EEOC finally contends that its statistical tests indicating that age was a significant
predictor of the likelihood of layoff permit a genuine inference of pretext. The district court
summarily rejected this contention, reasoning that statistics will only rarely rebut an employer's
particularized, legitimate, and nondiscriminatory reasons for the adverse employment decision.
The district court relied extensively on this court's opinion in Walther v. Lone Star Gas Co.,
977 F.2d 161, 162 (5th Cir.1992). In Walther, this court explained that statistical evidence usually
cannot rebut the employer's articulated nondiscriminatory reasons. The court observed that
gross st atistical disparities resulting from a reduction in force or similar evidence may be
10
"... a plaintiff can take his case to a jury with evidence that he was clearly better qualified
than younger employees who were retained." Walther, 952 F.2d at 123, citing Thornbrough v.
Columbus & Greenville R. Co., 760 F.2d 633, 647 (5th Cir.1985).
probative of discriminatory intent, motive or purpose. Such statistics might in an unusual case
provide adequate circumstantial evidence that an individual employee was discharged as part
of a larger pattern of layoffs targeting older employees. This is not to say that such statistics
are enough to rebut a valid, nondiscriminatory reason for discharging a particular
employee. Generally, they are not.... [P]roof of pretext, hence of discriminatory intent, by
statistics alone would be a challenging endeavor.
Walther, 977 F.2d at 162 (emphasis added) (citations omitted). Other circuits have expressed similar
skepticism about the ability of statistics to rebut the employer's nondiscriminatory reasons. See, e.g.,
LeBlanc v. Great American Ins. Co., 6 F.3d 836, 848 (1st Cir.1993), cert. denied, --- U.S. ----, 114
S.Ct. 1398, 128 L.Ed.2d 72 (1994) (noting that "a company's overall employment statistics will have
little direct bearing on the specific intentions of the employer when dismissing a particular
individual."); Barnes v. Gencorp., Inc., 896 F.2d 1457, 1469 (6th Cir.), cert. denied, 498 U.S. 878,
111 S.Ct. 211, 112 L.Ed.2d 171 (1990) (when the defendant offers particularized reasons, this
"cannot be rebutted by reference to the statistics already presented since the statistics here do not tend
to establish that age played a factor in any particular decision.") (citations omitted) (emphasis in
original).
While Walther explains that generalized statistical evidence will rarely rebut a particularized
nondiscriminatory rationale, statistical evidence may be probative of pretext in limited circumstances,
however. See Deloach v. Delchamps, Inc., 897 F.2d 815, 820 (5th Cir.1990) ("Delchamps further
claims that while statistical data may be used to establish a prima facie case, it cannot be used to
establish pretext. While that may be true when that is the only evidence a plaintiff has to establish
pretext ... we do not believe the same rule applies when a plaintiff offers additional evidence."). The
probative value of statistical evidence ultimately depends on all the surrounding facts, circumstances,
and other evidence of discrimination. International Bd. of Teamsters v. United States, 431 U.S. 324,
340, 97 S.Ct. 1843, 1856-57, 52 L.Ed.2d 396 (1977).
In the instant case, the statistical evidence offered by the EEOC does not support an inference
that TI's reasons for terminating the Six Supervisors were merely pretextual. Importantly, TI's expert,
Dr. Daniel S. Hamermesh ("Hamermesh"), showed that the EEOC's results are only statistically
significant for a subgroup of supervisors over 50, although the protected class includes all employees
over 40 years old. Hamermesh fo und that the layoffs were not statistically significant for ages
between 40 and 45 and those above 52; the layoffs had a statistically significant impact only for ages
46 through 51. Of the Six Supervisors, only Rains, Owens, and Hillis fall in the subgroup for which
a statistically significant result was deduced. EEOC did not sue on behalf of the 47 or 49-year old
supervisors who were laid off.
As this court has recognized, "particularly in age discrimination cases where innumerable
groupings of employees are possible according to ages and divisions within the corporate structure,
statistics are easily manipulated and may be deceptive." Walther v. Lone Star Gas Co., 952 F.2d 119,
124 (5th Cir.), on rehearing, 977 F.2d 161 (5th Cir.1992). EEOC's expert had no explanation for
his selection of the arbitrary age 50 cutoff other than that was the group EEOC asked him to
consider. EEOC's choice of age groups for statistical review is not probative of age discrimination.
Further, the EEOC's own expert admitted during his deposition that his statistical analysis did
not consider t he specific talents or duties of the manufacturing supervisors at TI. Because the
EEOC's statistics do not even purport to analyze the facts concerning individual supervisors, the
statistics are impotent, without more, to rebut TI's particularized reasons for the termination of the
Six Supervisors. The statistics cannot satisfy the requirement in Rhodes that the EEOC demonstrate
a fact issue as to whether each of the TI's stated reasons actually motivated its RIF. Rhodes, 75 F.3d
at 994.
Moreover, the authorities on which the EEOC relies are inapposite. Several cases considered
the proffered statistical evidence probative of pretext only because the plaintiff had offered
particularized evidence directly challenging the defendant's announced rationale. See, e.g., Deloach,
897 F.2d at 818-20 (only when coupled with other evidence contradicting employer's reasons was
statistical evidence probative of pretext); Freeman v. Package Machinery Co., 865 F.2d 1331, 1342-
42 (1st Cir.1988) (statistical evidence is probative when it demonstrated a pattern consistent only
with discrimination and it was combined with independent and conflicting testimony of job
performance); Krodel v. Young, 748 F.2d 701, 710 (D.C.Cir.1984), cert. denied, 474 U.S. 817, 106
S.Ct. 62, 88 L.Ed.2d 51 (1985) (without more, statistical evidence is "less significant" and "ordinarily
not dispositive" in disparate treatment cases); Reeves v. General Foods Corp., 682 F.2d 515, 523-25
(5th Cir.1982) (Reeves presented evidence that "his performance was such that the jury could have
decided that General Foods' admittedly articulated explanation of poor performance was unworthy
of credence."). Likewise, in Bienkowski v. American Airlines, Inc., 851 F.2d 1503 (5th Cir.1988),
this court recognized that statistical evidence was o nly probative of intent when the plaintiff had
disputed with other evidence the defendant's performance evaluation; in Bienkowski, the plaintiff had
produced various affidavits from which "a jury could conclude that his supervisors' evaluation of his
performance lacked veracity and that their true motivation resided in their age-based comments." Id.
at 1508. In other cases cited by the EEOC, the court merely explained in dicta that statistical
evidence can be evidence of pretext. See, e.g., EEOC v. Manville Sales Corp., 27 F.3d 1089, 1096
n. 5 (5th Cir.1994); Gusman v. Unisys Corp., 986 F.2d 1146, 1147-48 (7th Cir.1993) (suggesting
that "[c]laims of discrimination are hard to prove one case at a time," but emphasizing that "[a]mple
evidence warranted a conclusion [by the jury] that Gusman's immediate supervisor ... believed that
older workers are inferior."). Finally, contrary to the EEOC's suggestion, the court in MacDissi v.
Valmont Indus., Inc., 856 F.2d 1054 (8th Cir.1988), relied on statistical evidence merely to conclude
that the plaintiff had established a prima facie case of age discrimination; in fact, the court
distinguished MacDissi from other cases where the plaintiffs attempted to use statistics to prove
pretext. Id. at 1058. None of these cases suggest that statistics which rely on the arbitrarily selected
cutoff used here can be probative of pretext in these disparate treatment cases.
(5) Cumulative Impact of EEOC's Evidence
EEOC strenuously criticizes the district court for having discounted each of its types of
evidence separately and ignored that, taken together, all of the agency's evidence bespoke pretext
sufficiently to warrant a jury trial. The district court was obliged, however, to consider the
admissibility of evidence offered to support the parties' summary judgment positions pursuant to
Fed.Rule Civ.P. 56(e). His discharge of that duty led to a separate look at EEOC's categories of
evidence: alleged "ageist" comments; TI's departure from prior procedures and employee evaluation
standards; and statistical data. Like the district court, we have undertaken de novo review of the
record, including EEOC's attempted refutation of the individualized reasons for terminating each
supervisor and the other evidence offered by the agency. We agree with the district court that
portions of the agency's proffered evidence, e.g. the statistics and stray remarks, were not probative
of age discrimination. The agency failed to join issue on TI's business reasons for using a
non-seniority-protective method of selecting which supervisors to lay off. The agency's attempted
refutation of TI's individualized, nondiscriminatory reasons for discharging the Six Supervisors misses
the mark because it does not undermine the comparative rating of the Six Supervisors among all the
supervisors exposed to the RIF. EEOC also fails to cast doubt on TI's explanation that the
satisfactory performance of a supervisor during a period of economic stability does not necessarily
establish the employee's essentiality to the company and its future in an era of downsizing.
"Evidence" that does not imply pretext taken alone does not do so when cumulated. See Holmberg
v. Baxter Healthcare Corp., 901 F.2d 1387, 1391 (7th Cir.1990) ("the sum of four nondiscriminatory
episodes does not support [a] case anymore than viewing the four episodes separately"). The
agency's case, in sum, confused a quarrel with the merits of the company's business decision—a
quarrel in which the ADEA plays no role—with a case of illegal age discrimination.
STATUTE OF LIMITATIONS
In July 1994, TI sought leave to amend its answer and expand its plea of limitations as an
affirmative defense. The original answer asserted only that non-willful ADEA violations were
time-barred. Lat er that month but before the district court had ruled on the motion to amend, TI
moved for summary judgment on the grounds that the EEOC's claims were untimely. On the same
day that the district court granted TI summary judgment on the merits of the EEOC's claims, the
district court denied TI's motion for leave to amend as moot and denied summary judgment on
limitations.
TI has attempted to cross-appeal this denial of summary judgment and the court's refusal to
rule on its motion to amend. Even if we have appellate jurisdiction over these interlocutory orders,
it is unnecessary to discuss the timeliness of EEOC's complaint because, following the district court's
lead, we have alternatively ruled on the merits.
CONCLUSION
For the foregoing reasons, the district court's award of summary judgment to TI on the merits
of the claims brought by the EEOC is AFFIRMED.
KING, Circuit Judge, specially concurring:
I concur in the judgment affirming the grant of summary judgment for the defendant. In my
view, there is insufficient evidence that the nondiscriminatory reasons proffered by TI for the layoffs
at issue here were not the real reasons for those layoffs to send the case to the jury.
I do not understand the panel majority to be holding that, in the context of a reduction in
force, a showing that a discharged employee was clearly better qualified than younger, retained
employees is necessary to create a genuine issue of material fact. See EEOC v. Manville Sales Corp.,
27 F.3d 1089, 1096 n. 5 (5th Cir.1994).
I am not comfortable with the treatment in the majority opinion of the plaintiff's evidence of
age-based comments. But even if we accord those comments some probative value, they do not,
either independently or in conjunction with the other evidence in the case, constitute more than the
scintilla referred to in Boeing.