Court decisions may place higher costs on business

The rulings could make it easier for employees to win age discrimination cases, and also may encourage workers to challenge health and disability insurance claims in court that have been denied, business groups said.

The cases "may lack sex appeal, but they have a huge impact on the national economy," said Robin Conrad, executive vice president of the U.S. Chamber of Commerce's litigation arm.

Some legal experts said the Chamber's concerns are a bit overblown, but the rulings do follow at least three other cases earlier this year in which the court has decided in favor of employees in workplace law disputes. The court has taken an unusually large number of workplace cases this year, and has surprised some observers by ruling in favor of workers. The court's rulings last term overwhelmingly favored the private sector.

The Chamber did notch a win in a third case Thursday, when the court struck down a California state law that prohibited companies from using government funds to influence union-organizing efforts.

Still, Justice David Souter, in his majority opinion in the age discrimination case, acknowledged that the decision "makes it harder and costlier to defend" such lawsuits. But Souter said the court had to follow the law "the way Congress wrote it."

That case, Meacham v. Knolls Atomic Power Laboratory, began when Knolls laid off 31 workers, 30 of whom were over age 40. Twenty-six of those employees sued Knolls, claiming the layoffs violated the federal Age Discrimination in Employment Act.

The justices, in a 7-1 ruling, said when older workers are disproportionately affected by an employment decision, the employer bears the burden of explaining whether there was a reasonable explanation--other than age--for the company's action.

Knolls argued that the burden of proof should rest with the employees. Knolls, a joint project by the Department of Energy and U.S. Navy based in upstate New York, is owned by KAPL Inc., a subsidiary of Lockheed Martin Corp.

Justice Stephen Breyer did not take part in the case. He owns shares of State Street Corp., according to a financial disclosure report. State Street owns more than 18 percent of Lockheed Martin.