the ADEA is willful if the employer either "knew or showed reckless disregard for the matter of whether its conduct was prohibited by the ADEA." Hazen Paper Co., 113 S. Ct. at 1708 (citing Trans World Airlines, Inc., 469 U.S. at 126; McLaughlin, 486 U.S. at 133). The Hazen Paper Court also reaffirmed its conclusion that by enacting the ADEA, Congress intended to create a "two-tiered liability scheme" under which some but not all ADEA violations would give rise to liquidated damages. See Hazen Paper Co., 113 S. Ct. at 1708. Thus, the Court rejected a broader definition of willful providing for liquidated damages whenever the employer knew that the ADEA was "in the picture" because it would practically obliterate any distinction between willful and nonwillful violations. Id. The Court stated that "it is not true that an employer who knowingly relies on age in reaching its decision invariably commits a knowing or reckless violation of the ADEA." Id. at 1709. The Court further stated that "if an employer incorrectly but in good faith and nonrecklessly believes that the statute permits a particular age-based decision, then liquidated damages should not be imposed." Id.
Based on a review of the record, a jury acting reasonably could find that F&M did not act willfully or recklessly in discriminating against Kraemer because of her age. Accordingly, the jury's finding that F&M did not act willfully in discriminating against Kraemer on the basis of age is affirmed, and Kraemer's motion to amend the judgment to award her liquidated damages is denied.
C. PREJUDGMENT INTEREST ON AWARD OF BACK PAY
Kraemer moves for prejudgment interest on the award of back pay. The jury awarded Kraemer $ 73,456.00 in back pay. Kraemer calculates prejudgment interest using the Internal Revenue Service overpayment rates set forth at 26 U.S.C. § 6621 for each quarter from July 1, 1994 (the beginning of the 1994-1995 academic year) to November 28, 1995 (the date the judgment was entered). Kraemer requests that interest be compounded quarterly. In response to Kraemer motion for prejudgment interest, F&M stated that it would defer to the court's discretion as to whether prejudgment interest is appropriate and whether the interest rates posed by Kraemer are correct. F&M only objects to Kraemer's request that interest compound quarterly. F&M contends that interest should be compounded annually rather than quarterly.
The decision to award prejudgment interest and the amount of interest awarded are within the trial court's discretion. See Berndt v. Kaiser Aluminum & Chem. Sales, Inc., 629 F. Supp. 768, 770 (E.D. Pa. 1985), aff'd, 789 F.2d 253 (3d Cir. 1986). Because prejudgment interest reimburses the claimant for the loss of the use of his or her investment or funds from the time of the loss until judgment, the court concludes that an award of prejudgment interest is proper. Thus, the court awards Kraemer prejudgment interest using the statutory rates for overpayments set forth in 26 U.S.C. § 6621 that prevailed between July 1, 1994 and November 28, 1995. The interest will be compounded quarterly. See Taylor v. Central Pennsylvania Drug and Alcohol Servs. Corp., 890 F. Supp. 360, 368-70 (M.D. Pa. 1995); EEOC v. Reads, Inc., 759 F. Supp. 1150, 1162, n.20 (E.D. Pa. 1991) (awarding prejudgment interest on back pay in Title VII case using IRS rates and compounded quarterly).
For the foregoing reasons, the civil judgment order entered in this action on November 28, 1995 is amended to include an award of $ 60,000.00 in front pay. Kraemer's motion for prejudgment interest on the award of back pay is GRANTED and the civil judgment order entered in this action on November 28, 1995 is amended to include an award of $ 4,467.37 in prejudgment interest. In addition, Kraemer's motion to amend the civil judgment order to include liquidated damages is DENIED.
An appropriate Order follows.
[SEE TABLE IN ORIGINAL]
JULY 9, 1996
Upon consideration of the Proposed Findings of Fact and Conclusions of Law Regarding Instatement and Front Pay submitted by Plaintiff Ross S. Kraemer and Defendant Franklin & Marshall College, and for the reasons set forth in the accompanying Memorandum, it is ORDERED that
The Order dated November 28, 1995 entering judgment for Ross S. Kraemer against Franklin & Marshall College and awarding back pay to Kraemer in the amount of $ 73,456.00 is amended to include an award of front pay to Kraemer in the amount of $ 60,000.00 for a total award of $ 133,456.00.
IT IS FURTHER ORDERED that Plaintiff Ross S. Kraemer's motion to amend the judgment to include an award of liquidated damages is DENIED.
IT IS FURTHER ORDERED that Plaintiff's motion to amend the judgment to include prejudgment interest on the award of back pay is GRANTED. The civil judgment order entered on November 28, 1995 is amended to include prejudgment interest totalling $ 4,467.37 which is calculated using one fourth the overpayment rates set forth at 26 U.S.C. § 6621 for each quarter from July 1, 1994 to November 28, 1995, except the last quarter in which one sixth the rate was used, compounded quarterly, and assuming that back pay was received at the end of each quarter such that no interest is earned on the back pay earned each quarter until the following quarter.
IT IS SO ORDERED.