The international law firm of Sidley Austin LLP has agreed to pay $27.5 million to 32 former partners who the U.S. Equal Employment Opportunity Commission (EEOC) alleged were forced out of the partnership because of their age, under settlement approved by a federal judge.

The EEOC brought the suit in 2005 under the federal Age Discrimination in Employment Act (ADEA). A major issue in the case was whether partners in the law firm were protected as employees under the ADEA. The settlement provides that "Sidley agrees that each person for whom EEOC has sought relief in this matter was an employee with the meaning of the ADEA."

The settlement also includes an injunction that bars the law firm from "terminating, expelling, retiring, reducing the compensation of or otherwise adversely changing the partnership status of a partner because of age" or "maintaining any formal or informal policy or practice requiring retirement as a partner or requiring permission to continue as a partner once the partner has reached a certain age."

"This case has been closely followed by the legal community as well as by professional services providers generally," says Ronald S. Cooper, general gounsel of the EEOC. "It shows that EEOC will not shrink from pursuing meritorious claims of employment discrimination wherever they are found. Neither the relative status of the protected group members nor the resources and sophistication of the employer were dispositive here."

The $27.5 million will be paid to 32 former partners of the firm for whom the EEOC sought relief because they either were expelled from the partnership in connection with an October 1999 reorganization or retired under the firm's retirement policy.

The average of all the payments to partners under the settlement will be $859,375. The highest payment to any former partner will be $1,835,510, and the lowest payment $122,169. The median payment (the value in the middle of all payments) is $875,572.