Labor & Employment Law Daily Wrap Up, DISCRIMINATION—DISABILITY—U.S.: Retiree not holding or seeking job not ‘qualified individual’ under Title I of ADA, (Jun 20, 2025)

By Ronald Miller, J.D.

Under 42 U.S.C. § 12111(8), qualified individuals are those who hold or seek a job at the time of the defendant’s alleged discrimination.

A municipal firefighter who developed a disability that forced her to retire prior to obtaining 25 years of service, was not discriminated against under the ADA because her employer’s revised retirement policy entitled her to only 24 months of health insurance, ruled a divided U.S. Supreme Court. In resolving a split among the circuits, the Court concluded that, to prevail under 42 U.S.C. § 12112(a), a plaintiff must plead and prove that she held or desired a job and could perform its essential functions with or without reasonable accommodation at the time of an employer’s alleged act of disability-based discrimination. Justice Thomas filed a separate opinion concurring in part, and in the judgment. Justice Sotomayor filed a separate opinion concurring in part and dissenting. Justice Jackson filed a separate dissenting opinion (Stanley v. City of Sanford, Florida, No. 23-997 (U.S. Jun. 20, 2025)).

Title I of the ADA bars em­ployers from “discriminat[ing] against a qualified individ­ual on the basis of disability in regard to... compensation” and other matters. The statute de­fines a “qualified individual” as “an individual who, with or without reasonable accommodation, can perform the essen­tial functions of the employment position that such individ­ual holds or desires.”

Health insurance for retirees. In 1999, the employee started working as a firefighter for the City of Sanford. At the time she was hired, the city offered health insurance until age 65 for two categories of retirees: those who retired with 25 years of service, and those who retired earlier because of a disa­bility. However, in 2003, the city changed its pol­icy. It would continue to pay for health insurance up to age 65 for retirees with 25 years of service. But for those who retired earlier due to disability, the city would now provide health insurance for just 24 months, unless the retiree started receiving Medicare benefits sooner. After the city revised its policy, the employee began to suffer from an unspecified disability. In 2018, that “disabil­ity forced her to retire.” Under the city’s revised policy, she was entitled to at most 24 months of health insurance.

The employee brought suit claiming that the city had violated the ADA, among other claims. She contended that providing different health-insur­ance benefits to those who retire with 25 years of service and those who retire earlier due to disability amounted to impermissible discrimination based on disability. The city filed a motion to dismiss the employee’s complaint.

Qualified individ­ual. The district court denied that motion in part, allowing some of the employee’s claims to proceed. But with respect to her ADA claim, the district court observed that to assert a disparate-treatment claim under the ADA, 42 U.S.C. § 12112(a) required her to allege, among other things, facts sufficient to show that she was a “qualified in­dividual” at the time of the city’s alleged discrimination. The district court reasoned that, because the discrimination alleged by the employee—reduced healthcare benefits—did not take place until after she re­tired, at that point she was not a “qualified individ­ual” under the ADA. Accordingly, the district court granted the city’s motion to dismiss her ADA claim.

Circuit split. The Eleventh Circuit affirmed, concluding that § 12112(a) does not reach allegations of discrimination against a retiree “who does not hold or desire to hold an employment position” that she is capable of performing with reasonable accommodation. Like the Eleventh Circuit, the Sixth, Seventh, and Ninth Circuits have said that Title I’s antidis­crimination provision “does not protect people who neither held nor desired a job with the defendant at the time of dis­crimination.” But the Second and Third Cir­cuits determined that the ADA’s definition of “qualified individual” is “ambiguous,” and resolved that ambiguity “in favor of” extending the statute to reach retirees like the employee.

Section 12112(a) provides Title I’s general liability rule for disability discrimination. It makes it unlawful for a covered employer to “discriminate against a qualified individual on the basis of disability in regard to... compensation,” among other things. The parties disagreed about the meaning of this language. They took as given that retirement benefits, like those at issue here, qualify as “compensation.” The only question that separated the parties was whether § 12112(a) addresses discrimination against retirees.

Present-tense verbs. The Court observed that Congress made it unlawful to “discriminate against” some­one who “can perform the essential functions of” the job she “holds or desires.” Those present-tense verbs signal that § 12112(a) protects individuals who, with or without reason­able accommodation, are able to do the job they hold or seek at the time they suffer discrimination. Conversely, those verbs tend to suggest that the statute does not reach retir­ees who neither hold nor desire a job at the time of an al­leged act of discrimination.

Section 12112(b) conveys a similar message, and underscores § 12112(a)’s focus on current and prospective employees—not retirees. Further evidence comes from examining Title I of the ADA in light of Title VII. While Title VII sometimes bars discrimination against for­mer employees as well as current ones, elsewhere in Title VII, context clarifies that “the term ‘em­ployee’ refers unambiguously to a current employee.”

The court observed that § 12112(a) does not protect “compensation” as such. Instead, it bars employers from “discriminat[ing] against a qualified individual on the basis of disability in regard to... compensation.” In other words, the statute protects people, not benefits, from discrimination. Under § 12111(8), qualified individuals are those who hold or seek a job at the time of the defendant’s alleged discrimination.

Relief for retirees. The employee invited the Court to address not just the question of whether a retired employee who does not hold or seek a job is a “qual­ified individual” under Title I, but to decide whether her complaint satisfied that standard. Though the Court ordinarily rejects attempts to inject “an entirely new question at the merits stage,” it found it profitable to make an exception in this case to the extent that it highlights how Title I might provide relief for retirees.

Unlawful discrimination. A plaintiff pursuing a claim under § 12112(a) must plead and prove that she held or sought a job when the defendant discriminated against her on the basis of disability. Here, at the time the city revised its policy in 2003, the employee was not disabled and still expected to complete 25 years of service. The employee’s complaint provided no basis for inferring that the city’s policy injured her in 2003. So, this option was off the table for the employee.

Unlawful discrimination also occurs “when an individual is affected by application of a discriminatory compensation decision or other practice.” The employee alleged that that happened to her in 2020, when her subsidized health insurance ran out. By then, however, she had been retired for two years, could not satisfy the “requirements of” her job, and was not seeking employment. So, this option also could not help the employee.

Finally, unlawful discrimination takes place when “an individual becomes subject to a discriminatory compensation decision or other practice.” However, this option also could not form a basis for reversing the Eleventh Circuit’s judgment in this particular case. Because this dispute came to the Court on a motion to dismiss, it the Court could not look beyond the pleadings. And her complaint said nothing about the timing or nature of her diagnosis, nor did it allege that she worked for any period of time with a disability.

Accordingly, the judgment of the Eleventh Circuit was affirmed.

Concurrence. Justice Thomas joined Parts I and II of the Court’s opinion but wrote separately to express concern with “the increasingly common practice of litigants urging this Court to grant certiorari to resolve one question, and then, after we do so, pivoting to an entirely different question.” He would not opine on the employee’s additional question of whether she could sue based on dis­crimination that occurred while she was still employed and able to work.

Concurring in part and dissenting in part. Justice Sotomayor joined Parts III and IV of the dissent because, in her view, Title I’s prohibition on disability dis­crimination does not cease the day an employee retires. Sotomayor agreed that plaintiffs in the employee’s situation can plead disability discrimination if they were “‘sub­ject to a discriminatory compensation decision or other practice’” while a qualified individual.

Dissent. In a dissenting opinion, Justice Jackson argued that the Court overlooked both the actual facts pre­sented in this case and the clear design of the ADA to ren­der a ruling that plainly counteracts what Congress meant to—and did—accomplish. Jackson observed that the Court relied on Title I’s “qualified individual” definition—a provision de­signed to protect employers from having to employ those who cannot do the work, not to cut off the rights of those who already finished it.

The case is No. 23-997.

Judge: Gorsuch, N.

Attorneys: Deepak Gupta (Gupta Wessler) for Karyn D. Stanley. Jessica Christy Conner (Morgan & Lawton) for City of Sanford.

Companies: City of Sanford

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