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Important Lesson For Employers in Supreme Court's Holding in Ricci Case

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What really happened in the Ricci v. DeStefano “reverse discrimination” case. The City of New Haven discovered after administering a test for promotions within the Fire Department that no African-Americans qualified for promotions based on the test. Only after administering the test and seeing these results did the City for the first time realize that this could be a problem. Then, stuck between a rock and a hard place, they decided without doing any analysis of the test that they would not grant the promotions to the white and Hispanic firefighters who had scored highest on the test because they feared that to do so would risk a lawsuit for disparate impact by the African-American firefighters. 

 
This case brought the two types of discrimination under Title VII in conflict with each other when the City of New Haven basically found itself in the situation where if it did not certify the test results and grant the promotions it would be faced with a disparate treatment lawsuit by the white and Hispanic firefighters but if it granted the promotions it would be faced with a disparate impact lawsuit by the African-American firefighters. Title VII prohibits two separate types of discrimination. Disparate Treatment discrimination is intentional discrimination based on an employee’s race, color, religion, sex, or national origin. Disparate Impact discrimination is where a neutral practice or policy has an adverse impact on a protected class and where the practice or policy is not job-related nor justified by business necessity and where there is an alternative policy or practice that has a less discriminatory impact.   
 
Thus, having failed to do what they should have done before administering this test in the first place, to wit making sure through validation procedures that the test did not have a disparate impact on any protected class of employees, the City of New Haven now made matters even worse by making a decision based solely on race that it would deny promotions to the qualified white and Hispanic firefighters solely because they were white and Hispanic. This, the Supreme Court of the United States held in a 5-4 decision violated the white and Hispanic’s civil rights under Title VII as disparate treatment discrimination because of the prohibition under Title VII against intentionally making employment decisions based on an employee’s race. Rather, Title VII requires that employment decisions be based on job-related factors unrelated to the employee’s race.
 
The City of New Haven alleged that its decision to deny the promotions to the white and Hispanic firefighters based on their race should have not violated Title VII because it did so only because to do otherwise would have subjected it to liability for disparate impact under Title VII by another group of employees, namely the African-American firefighters. The Supreme Court held that an employer would only have a valid defense and be allowed to do this if “there was a strong basis in evidence” that to deny the promotions and thus intentionally discriminate based on race against the white firefighters was necessary to remedy the disparate impact of the test on the African-American firefighters.
 
Here, the Supreme Court held, there was not “a strong basis in evidence” because the City acted only on its fear that it might be subject to a lawsuit by the African-American firefighters. Although the Court did not specify what might satisfy this “strong basis in evidence” test, it seems likely that if the City had done a statistical analysis prior to deciding to not grant the promotions to the white and Hispanic firefighters it might have been in a stronger position to satisfy this test. The Supreme Court also clearly stated that “a strong basis in evidence” required more than just a showing that a prima facie case of disparate impact could have been established. Here, the City would only have been liable for disparate impact if even after the plaintiffs had made out a prima facie case of disparate impact discrimination, it was established that the tests for promotion were not job-related and consistent with business necessity or if there was an equally valid less discriminatory alternative that also served the City’s needs but that the City refused to use. Since this was not the case here, the City could not establish that there was “a strong basis in evidence” that it would have been liable for disparate impact discrimination. It appears that the new test set forth by the Supreme Court in this case requires an employer to go through the entire analysis a court would make in deciding the disparate impact case and then only if after the entire analysis it appears that the employer would lose the disparate impact case would the employer have a valid defense for engaging in intentional discrimination to avoid this result. 
 
So what is the important lesson for employers with regard to administering employment tests in the workplace? Make sure you have your ducks in a row before administering any employment-related tests. This means that employers should, prior to administering any employment tests, consult with employment counsel who can retain an expert to conduct a validation study to determine if the test would possibly have a disparate impact on any protected class. If it would, do not administer the test without revising the test to eliminate any disparate impact on a protected class. In addition, employers should consult with employment counsel post-test administration to assist employers in deciding what action to take if the employer should find itself in the conundrum that the City of New Haven found itself in this case. 
 
Submitted by:
Melissa Fleischer, Esq.
President and Founder
HR Learning Center LLC

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