The U.S. Supreme Court recently held that Kentucky’s disability retirement program, which imputes years of service to employees who become disabled before becoming eligible for a regular pension, but does not do so for employees who become disabled after becoming pension eligible, does not violate the Age Discrimination in Employment Act (ADEA). See Kentucky Retirement Systems v. EEOC (June 19, 2008). In its five to four decision, the Court rejected the argument of the Equal Employment Opportunity Commission (EEOC) that such a plan automatically discriminates because of age. The Court found that Kentucky’s plan distinguishes among employees based on pension status, not age. In such cases, a person challenging the plan must present evidence that the different treatment was "actually motivated" by age, not pension status, which the EEOC failed to do.

The U.S. Supreme Court recently held that Kentucky’s disability retirement program, which imputes years of service to employees who become disabled before becoming eligible for a regular pension, but does not do so for employees who become disabled after becoming pension eligible, does not violate the Age Discrimination in Employment Act (ADEA). See Kentucky Retirement Systems v. EEOC (June 19, 2008). In its five to four decision, the Court rejected the argument of the Equal Employment Opportunity Commission (EEOC) that such a plan automatically discriminates because of age. The Court found that Kentucky’s plan distinguishes among employees based on pension status, not age. In such cases, a person challenging the plan must present evidence that the different treatment was “actually motivated” by age, not pension status, which the EEOC failed to do.

In a 5-4 decision, the Supreme Court held that the Commonwealth of Kentucky's disability plan, which was not made available to persons already eligible for normal retirement benefits by virtue of their years of service (or age, plus years of service), was not discriminatory on its face, and did not violate the Age Discrimination in Employment Act (ADEA). The Court emphasized that it was dealing with the "quite special case" of different treatment based on pension status where pension status itself turns on age, noting that the ADEA permits an employer to condition pension eligibility upon age. The Court adopted the rule that, where an employer adopts a pension plan that includes age as a factor, and then treats employees differently based on pension status, the employee must come forward with evidence that the differential treatment was "actually motivated" by age, not pension status.