Texas Roadhouse Settles Its Beef; Reminds Employers Everywhere that Young Workers Come at a Cost

Seven years and $12 million later, Texas Roadhouse has finally cried uncle.  The company made the “business decision” to settle its long-running age discrimination lawsuit after a recent mistrial meant potentially facing years of continued legal bleeding.  The case is the largest age discrimination suit the EEOC has brought to trial in more than thirty years, and an important reminder for employers everywhere that hiring for age can cost them big.  ​

The saga for the steakhouse chain began back in 2011 when it was targeted by the EEOC through a directed investigation – a seldom used legal tool in which the Commission conducts its own investigation and files suit, rather than waiting for workers to submit complaints.  The EEOC alleged in its lawsuit that the company had a pattern and practice of discriminating against older applicants, specifically those who applied for “front of the house” positions like hosts, bartenders and servers.
 
The Commission maintained that the company had a “hire young” mentality and took steps to ensure that older workers weren’t brought on in a public capacity.  As proof, the Commission pointed to evidence that the company sent photos of young people to area managers labeled “ideal employees” and posted stickers on unsuccessful job applications with comments like “Old ‘N Chubby,” “OLD,” “little older lady” and “doesn’t really fit our image.” Perhaps most damming were the employment statistics, which showed that of the nearly 182,000 people hired for front of the house positions, only 1.62 percent were over 40 years old. 
 
Texas Roadhouse countered that the numbers were wrong, and that there was no proof of an intentional, company directed standard operating procedure of discrimination.  To the contrary, the company maintained that not only did it not discriminate, Texas Roadhouse had a strong anti-discrimination policy that was expressed on various company materials, including training manuals and newsletters that were disseminated to employees. 
 
Because the Consent Decree that resolved this case was not an admission of guilt, whether a jury would have found that the company engineered a nationwide program of intentional age discrimination will ultimately remain unknown.  But the facts of this case provide a great opportunity for employers to reflect upon discrimination that may exist within their own companies. 
 
As we saw in this case, having a written anti-discrimination policy serves little purpose if it isn't backed up by company action.  Employers should carefully monitor the hiring process to ensure that job notices, ads and interviews are conducted legally and within the bounds of state and federal law.  Moreover, employers should remain cognizant of their own company culture and its impression on both employees and the public.  The HR Director of Texas Roadhouse hit the perception-is-reality nail on the head when asked about the allegations.  She allegedly responded: “Did we do it?  Of course we did it.  All you have to do is walk in the front door of our restaurants and see what people look like.” ​