Home Email This page Print Bookmark


Supreme Court: City Violated Title VII By Rejecting Test Results To Avoid Disparate Impact Claims


June 30, 2009

In what may be the most significant ruling of its current term, the U.S. Supreme Court held on June 29, 2009 that the City of New Haven, Connecticut violated Title VII by throwing out the results of a firefighter promotion examination after white candidates scored significantly better than minority candidates.  Ricci v. DeStefano.   

Legal Background

Under Title VII, employers can be held liable not only for intentional discrimination or "disparate treatment," but also for engaging in facially-neutral employment practices that have a disproportionate negative affect or "disparate impact" on members of a particular protected group.  In a disparate impact case, a plaintiff must prove that a specific employment practice has a statistically significant negative effect upon members of his or her protected class.  If the plaintiff does so, the burden of proof shifts to the employer to show that the practice in question is "job related" and consistent with "business necessity."  If the employer meets that burden, the plaintiff can still prevail by showing that the employer could have met the same business need through some other practice that would not have resulted in the same statistical disparity. 

Facts of the Case

In 2003, the City of New Haven administered examinations to 118 firefighters seeking promotion to the ranks of captain and lieutenant.  The results of the examination were to be used to select candidates for promotion to captain and lieutenant over the next two years.  White candidates did significantly better on the test than their minority counterparts.  On the captain exam, the pass rate for white candidates was 64% for white candidates, but only 37.5% for both black and Hispanic candidates.  On the lieutenant exam, 58.1% of white candidates passed, but only 31.6% of black candidates and 20% of Hispanic candidates passed.  At roughly one-half the pass rate for white candidates, the pass rates for minority candidates on both exams fell well below the 80% standard set by the Equal Employment Opportunity Commission as the "rule of thumb" for identifying unlawful disparate impact.

The results of the test prompted a rancorous public debate.  Some community members and officials argued that the tests should be discarded because the results showed them to be discriminatory, and several firefighters threatened a disparate impact lawsuit if the City based its promotion decisions on the tests.  Others argued that the tests were neutral and fair.  Firefighters who favored the tests threatened to sue the City for intentional disparate treatment if it threw out the results based upon the statistical racial disparity.  Ultimately, after several days of public hearings, the City took the side of those protesting the test results, throwing out the examinations and deferring all promotions until a new assessment process could be designed and implemented.

As promised, a group of white and Hispanic firefighters who likely would have been promoted based upon their good test performance sued the City and some of its officials, arguing that they violated Title VII by dismissing the test results based solely upon the racial disparity between white and minority candidates.  The City countered that its actions were not based upon race, but upon its good faith belief that using the racially-skewed test results as a basis for promotion decisions would subject the City to Title VII liability under a disparate impact theory.  The district court agreed with the City and granted its motion for summary judgment.  That ruling was summarily affirmed by the U.S. Court of Appeals for the Second Circuit.  (Judge Sonia Sotomayor, who has been nominated to succeed Justice David Souter following his retirement at the end of this term, participated in that decision.)  The firefighters then appealed to the U.S. Supreme Court.

Majority:  City Violated Title VII

In a 5-4 decision written by Justice Kennedy, the Court held that the firefighter tests presented a conflict between Title VII's ban on intentional race discrimination and its prohibition on employment practices that unintentionally, but disproportionately and unnecessarily affect protected groups.  The Court found that the City's decision to throw out the test results, even if well-intentioned, amounted to intentional race discrimination because it was undisputedly based upon the racial breakdown of the test results.  While recognizing the City's duty to comply with Title VII's disparate impact prohibition, the Court held that fear of disparate impact claims in itself is not a justification for racial discrimination.  However, the Court also rejected the firefighters' argument that avoiding unintentional discrimination could never justify intentional discrimination under Title VII, and their alternative argument that an employer must in fact be in violation of Title VII's disparate impact prohibition before it can use compliance as a defense in an intentional discrimination lawsuit.

Instead, the Court borrowed from earlier cases under the Equal Protection Clause of the Fourteenth Amendment, which held that government bodies can take actions that are themselves based upon race for the purpose of remedying past racial discrimination only where there is a "strong basis in evidence" that the remedial actions are necessary.  Applying this standard to the Title VII context, the Court held that "before an employer can engage in intentional discrimination for the asserted purpose of avoiding or remedying an unintentional disparate impact, the employer must have a strong basis in evidence to believe that it will be subject to disparate-impact liability if it fails to take the race-conscious, discriminatory action."

Following an extensive review of the facts in the record, the majority held that the City did not present the necessary "strong evidence" that the tests were not job-related and consistent with business necessity.  The Court noted that both tests were carefully crafted by a testing firm to ensure that they were related to the captain and lieutenant positions and to avoid any undue racial disparity.  Further, the Court found that the City failed to present any competent evidence that some alternative testing procedure would have met the City's needs while avoiding the racial disparity.

The Court was, however, careful to limit its holding so as not to prohibit prospective efforts to comply with Title VII's disparate impact prohibitions, stating, "Title VII does not prohibit an employer from considering, before administering a test or practice, how to design that test or practice in order to provide a fair opportunity for all individuals, regardless of their race."  "But once that process has been established and employers have made their clear selection criteria, they may not then invalidate the test results, thus upsetting the employee's legitimate expectation not to be judge on the basis of race."

Dissent:  Efforts To Comply With Title VII Are Not Discriminatory

In a lengthy dissent joined by Justices Souter, Stevens and Breyer, Justice Ginsberg argued that the majority misread Title VII by treating the statute's prohibitions on intentional discrimination and disparate impact as conflicting directives.  Rather, the two proscriptions must be read as complimentary.  Thus, the dissenters argued, an employer who rejects employee selection criteria that operate to the disadvantage of minority groups based upon reasonable doubts about their reliability "can hardly be held to have engaged in discrimination ‘because of' race," so long as the employer has "good cause to believe that the device would not withstand examination for business necessity."  The dissenters criticized the "strong basis in evidence" test adopted by the majority, stating that it was difficult to see how this standard differed from "demanding that an employer establish a ‘provable, actual violation' against itself."

The dissenters went on to argue that the majority "stacks the deck further" by ruling that the City failed to meet the new standard, instead of remanding the case to the district court to apply the newly-announced rule.  Contrary to the majority's view, the dissenters found that the record "solidly establishes" that the City had good cause to believe that the tests might be found to violate Title VII, noting that there were serious questions about the content of the tests; allegations that white firefighters received earlier access to study materials; and the possible availability of alternative selection procedures that would not have had the same disparate impact.  Further, even under the "strong-basis-in-evidence" standard adopted by the majority, the dissent stated that the majority provided "no tenable explanation why the evidence of the tests' multiple deficiencies does not create at least a triable issue," requiring remand to the district court.

Concurring Opinions

Justices Alito and Scalia submitted separate concurring opinions in addition to joining the opinion of the Court.  In his concurrence, Justice Alito responds to criticisms lodged by the dissenters, and provides a more detailed recitation of facts supporting the majority's ruling.

Although brief, Justice Scalia's concurring opinion may ultimately carry greater long-term significance for employment discrimination law than the majority opinion.  While Justice Scalia agreed with the Court's decision, he wrote that it "merely postpones the evil day on which the Court will have to confront the question: Whether, or to what extent, are the disparate-impact provisions of Title VII of the Civil Rights Act of 1964 consistent with the Constitution's guarantee of equal protection?"  While Ricci presented a situation in which the employer wrongly concluded that there was a conflict between its obligation to avoid race-conscious decision-making and Title VII's prohibition on disparate impact, Justice Scalia noted that Title VII "not only permits but requires" race-conscious decision-making "when a disparate-impact violation would otherwise result."  That, according to Justice Scalia, presents a problem under the Equal Protection clause, because "if the Federal Government is prohibited from discriminating on the basis of race … then surely it is also prohibited from enacting laws mandating that third parties -- e.g. employers, whether private, State or municipal -- discriminate on the basis of race."  Further, whereas the majority opinion is careful to note that an employer would not violate Title VII by engaging in prospective efforts to ensure that selection practices do not disparately impact minority groups, Justice Scalia suggests that even this may violate the Equal Protection Clause: "Would a private employer not be guilty of unlawful discrimination if he refrained from establishing a racial hiring quota but intentionally designed his hiring practices to achieve the same end?  Surely he would.  Intentional discrimination is still occurring, just one step up the chain.  Government compulsion of such design would therefore seemingly violate equal protection principles."

Impact for Employers, "War" Between Disparate Impact and Equal Protection?

The Court's decision in this case will unquestionably place some employers in a difficult position as they attempt to thread the needle between Title VII's prohibition on intentional discrimination and its ban on practices that have an unnecessary disparate impact on protected groups.  While the Court's ruling would excuse employers from liability for intentional discrimination where there is a "strong basis in evidence" to believe that the selection criteria at issue would violate Title VII's disparate impact prohibition, this is a difficult burden to carry.  Indeed, as the dissenters observe, this standard may effectively force employers to prove that an employee selection practices actually violated Title VII in order to avoid Title VII liability for abandoning the practice. Consequently, employers may feel compelled to defend even questionable practices rather than face intentional discrimination claims.  To avoid this difficult situation, employers should now take extra care before implementing any employee testing procedures to ensure that such procedures are well-validated and can survive a disparate impact challenge.

As difficult as this issue will be for some employers, the larger fight may be yet to come, as both the majority opinion and Justice Scalia's concurrence seem to invite direct attack on the entire concept of disparate impact litigation.  The majority opinion carefully sets this constitutional issue aside for later consideration: "Our statutory holding does not address the constitutionality of the measures taken here in purported compliance with Title VII.  We also do not hold that meeting the strong-basis-in-evidence standard would satisfy the Equal Protection Clause in future cases."  In light of this language, Justice Scalia may well be correct when he predicts that "the war between disparate impact and equal protection will be waged sooner or later, and it behooves us to begin thinking about how -- and on what terms -- to make peace between them."

Related Practices