Real World Impact: On June 20, 2025, in Stanley v. City of Sanford, the United States Supreme Court concluded that a retiree who could no longer work because of a disability is not a “qualified individual” entitled to protection under Title I of the Americans with Disabilities Act.
Background: The ADA, through Title I, prohibits an employer from discriminating against a “qualified individual” because of a disability in the terms and conditions of employment, such as compensation. A “qualified individual” is defined by the ADA as someone “who with or without reasonable accommodation can perform the essential functions of the employment position that [she] holds or desires.” Stanley settled a dispute among the Circuits regarding whether the ADA protects a disabled retiree who could no longer “perform the essential functions of the employment position” due to the disability for which she retired. The Sixth, Seventh, Ninth, and Eleventh Circuits held such retiree was no longer a “qualified individual” and, therefore, had no protection, while the Second and Third Circuits disagreed, finding the term “qualified individual” to be ambiguous enough to extend to retirees.
In Stanley, the plaintiff worked as a firefighter for the City of Sanford until she became disabled and retired. When she commenced her employment, the city provided health insurance benefits until age 65 for all retirees who either worked for 25 years or retired due to disability. A few years after she began working, the city changed its policy to only provide 24 months of health insurance to someone retiring due to disability, while maintaining the same benefits for those working 25 years. The plaintiff was forced to retire after 19 years of employment due to disability. She sued under the ADA alleging the city’s policy to only provide 24 months of health insurance to disabled retirees was facially discriminatory because it treated disabled retirees less favorably than other retirees.
The District Court dismissed the lawsuit. Examining the ADA, the District Court held once the plaintiff retired due to disability, she could no longer perform the essential functions of the job with or without accommodation, thereby no longer meeting the definition of “qualified individual.” The Eleventh Circuit Court of Appeals affirmed the lower court’s decision, holding that the ADA does not apply to allegations of discrimination against a retiree who neither holds nor desires an employment position which may be performed with reasonable accommodation. The certified question was whether the ADA “reaches discrimination against retirees who can neither hold nor desire a job whose essential tasks they can perform with reasonable accommodation.”
Supreme Court Decision: Justice Neil Gorsuch, writing the majority opinion, assumed that the policy at issue “constitute[s] discrimination on the basis of a disability” because on its face it treats a retiree without a disability differently than a retiree with a disability. According to Justice Gorsuch, the narrow issue was whether the statutory language prohibited that discrimination against a retiree — a non-employee who could no longer work. Looking to the statutory text, the Court first noted the present tense use of the verbs “to discriminate,” “can perform,” and “holds or desires.” Meaning, in the present they must be able to work or desire to do so. Adding support was prior interpretation of similar terms in Title VII of the Civil Rights Act of 1964, wherein the Court previously held that because it links the word “employee” to a present tense verb, the statute refers to current employees. Similarly, the terms “reasonable accommodation” and “discrimination” include examples of things applicable to someone who can work, as opposed to a disabled retiree who cannot. The Court further relied on its previous decision in Cleveland v. Policy Management Systems Corporation wherein the Court held that an employee “unable to work will appear to negative an essential element of her ADA case.”
Addressing the plaintiff’s complaint directly, the Court described several ways that, despite its holding, a disabled retiree could nevertheless be covered by the ADA. The Court noted that there are three “points in time” that a person can suffer discrimination. The first point in time is when an employer adopts a discriminatory practice. The Court stated that where a disabled retiree can plead and prove that he or she was a “qualified individual” at the time the discriminatory policy was adopted, such a claim may be successful. For the plaintiff, that was not possible because the policy was adopted in 2003 at a time she was not disabled.
Second, an employee can suffer discrimination when he or she becomes affected by the discriminatory practice. The Court reasoned that a disabled retiree could be covered by a showing that he or she was affected by a discriminatory policy change during a time he or she was a “qualified individual,” even if suit is filed after retirement or after the disability renders him or her no longer a “qualified individual.” In the case of the plaintiff, she lost her health insurance two years after she retired because she was unable to perform the essential functions of her job with or without reasonable accommodation, so she was affected by the policy long after she lost her status as a “qualified individual.”
Finally, the Court stated that a discriminatory practice can also take place when an individual “becomes subject to a discriminatory compensation decision.” In other words, while a disabled employee is still a “qualified individual,” the employer makes a decision that treats a disabled employee less favorably, even if suit is brought after retirement. For example, as explained by the Court, a retiree would have a viable ADA claim if while both disabled and a “qualified individual” he or she was subject to a discriminatory policy that in the future would result in reduced retirement benefits. However, in the case of the plaintiff, she failed to plead when she became disabled or the nature of her diagnosis that would even permit a plausible inference to satisfy these prerequisites, rendering the decision to dismiss the complaint appropriate.