Alaska Employment Law

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Introduction

Reversing a “wise Latina judge,” the United States Supreme Court concluded its 2008-09 Term on June 29, 2009, by issuing its long-awaited affirmative action opinion in Ricci v. DeStefano, et al., ___ U.S. ___ (2009).  The Court held 5-4 that the City of New Haven violated Title VII when it adopted race-neutral tests for use in promoting employees, and then disregarded the test results because it did not like the racial distribution of the test scores after it realized that certain minorities did not score well on the tests.  This summary briefly reviews the case and relevant principles. 

The Case

The Fire Department for the City of New Haven, Connecticut, adopted race-neutral tests for purposes of determining promotions to command positions.  The City’s existing civil service regulations mandated merit hiring and provided that eligible candidates for any position would be limited to the top three test scores to curtail political patronage and favoritism.  Several firefighters seeking promotion to Captain or Lieutenant positions took the test.  The City decided to reject the test results after it realized that non-minority candidates fared better than minority candidates.  The testing protocol itself complied with all EEOC guidelines.  However, the City was advised that alternative tests existed that may have a less-discriminatory impact.  In making this decision, the City did not act to remedy any prior unlawful discrimination.  The City did not act to achieve diversity.  Instead, the basis for the City’s decision was that it wanted to avoid public criticism for a perceived (not actual) lack of diversity, and to preclude any lawsuits being filed that might bear adverse political consequences for City officials. 

Firefighters adversely affected by the City’s rejection of the test results filed suit.    They argued that, if the City wanted to reject the test results for the avowed goal of Title VII compliance, the City should first be required to show that certifying the test results would violate Title VII.  Applying the familiar McDonnell Douglas burden-shifting analysis, the district court granted the City summary judgment, reasoning that the City was acting in good faith to try and comply with Title VII.   Among other points, the district court noted that the City was concerned that the test results had a statistically adverse impact on minorities, promoting non-minority candidates might subject the City to public criticism, and certifying the test results may subject the City to Title VII lawsuits that City officials wished to avoid for political reasons.  The district court rejected plaintiffs’ Equal Protection arguments because, in its view, the decision to reject the test results was not based on a racial classification justifying strict scrutiny.  The district court reached this conclusion because it reasoned that everyone was treated the same since no one was promoted. 

The lower court’s opinion

The United States Court of Appeals for the Second Circuit affirmed.  The panel concluded that the City was only trying to meet its obligations under Title VII when it was unexpectedly confronted with test results that had a disproportionate racial impact.  Judge Sonia Sotomayor –President Obama’s nominee to replace Justice Souter on the Court—was on the three judge panel. The Second Circuit denied rehearing en banc on a sharp 7-6 split.  The majority concluded that the refusal to certify the test results was, at face value, a race-neutral decision and was motivated by the City’s good faith intent to comply with Title VII.  Dissenting Judges noted that a mixed motive analysis should probably have been used, but conceded that the plaintiffs had not urged such before the district court and consequently may have waived reliance on it.  The United States Supreme Court accepted review.  

Opinion

In an opinion authored by Justice Kennedy, the Court reversed on a 5-4 split.  The Court acknowledged that competing tensions existed in Title VII’s statutory scheme between the provisions prohibiting employment discrimination because of a protected classification (disparate treatment) and the disparate impact provision added by the Civil Rights Act of 1991 that prohibits employment practices that have the unintended result of impermissible discrimination.  However, before an employer may rely on affirmative action arguments to disregard employment-related tests, the majority held that the employer would need to “demonstrate a strong basis on evidence that, had it not taken the action, it would have been liable under the disparate impact statute.”  Statistical disparity, by itself, is not enough to justify disregarding an otherwise race-neutral test, and neither is the desire to avoid litigation.  The majority concluded that New Haven could not meet the “strong basis in evidence” standard because the tests were job-related and consistent with a business necessity and the City did not show that there was no equally valid, less discriminatory alternative. The Court’s opinion only addressed Title VII.  The Court did not reach the constitutional issues presented under the Equal Protection clause.

Justice Ginsburg dissented, joined by Justices Stevens, Breyer, and Souter.  The dissent noted that Title VII should not be interpreted to discourage voluntary compliance, and that employers should be able to rely upon good faith attempts to comply with the law when evaluating test results. The dissent further criticized the majority for reaching the ultimate merits without remanding to the lower courts for application of the new evidentiary standard.  The dissent noted that, at a minimum, there were genuine issues of material fact under the “strong basis in evidence” standard concerning whether or not the testing procedures were justified by a business necessity.   

Significance

In my preview of this case that we circulated on January 26, 2009, I predicted:

Given the impossibly fractured results that we have seen in the Court’s affirmative action jurisprudence, it is anybody’s guess as to what the Court may do in this case.  We may get some indirect hints if we wait for the merits briefing and the oral argument transcripts.  However, as a long range forecast, I believe that this case will probably reflect the same or similar sharp divide that we saw in the 2007 school district cases.  Title VII encourages voluntary remedial measures.  EEOC guidelines instruct that evidence of adverse impact in testing may be established if the selection rate for any race, sex, or ethnicity is less than four-fifths of the selection rate for the group with the highest rate (the so-called “four-fifths rule”).  See 29 C.F.R. § 1607.4(D).  However, Title VII prohibits employers from adjusting scores or altering test results on the basis of race.  See 42 U.S.C. § 2000e-2(l).  It is hard to see how the City could justify its position as only being an attempt to comply with Title VII when, in carrying out this stated goal, the City was violating an express provision of Title VII.  More importantly, the Court’s recent Equal Protection precedent is generally understood as prohibiting race-based measures unless they are implemented for purposes of remedying past intentional discrimination (which is not the case here) and survive traditional strict scrutiny analysis (narrowly tailored to serve a compelling government interest).  

Therefore, with the understanding that this is a long range forecast, I think the Court will probably reverse on a 5-4 vote if the Justices remain true to their prior reasoning, and I believe that the five votes will come from Chief Justice Roberts, Justice Kennedy, Justice Scalia, Justice Thomas, and Justice Alito.  This case does not present any of the customary policy reasons justifying a race-based decision.  The City was not acting to remedy past intentional discrimination.  The City was not acting to promote diversity.  The test satisfied EEOC guidelines, was race-neutral, and had been pre-approved for use.  The firefighters seeking promotion played by the rules, took the test, and passed.  The City’s existing civil service regulations provided that eligibility would be limited to the top three test scores.  The City’s reason for rejecting the test results after the fact was solely race-based.  Contrary to the district court’s reasoning, the applicants were not treated the same.  It is true that no one was promoted, but the non-minority candidates were not promoted solely because of their racial classification and for no other reason.   Aside from the Equal Protection problems, the Second Circuit’s result changes Title VII from a statute designed to prohibit consideration of an employee’s race into a statute that requires proportional representation in the workplace.  Consequently, I believe that it is more likely than not that the Court will reverse, but it will probably be by way of another splintered opinion that raises more questions than it answers.

The Court’s current and projected composition will not disturb the existing split.  Although we will probably see some additional affirmative action type cases in the near future, we are not likely to see any meaningful clarifications from the Court for at least five to ten years.  However, it is possible that Congress may attempt to legislatively overrule the Court by enacting further amendments to Title VII.  While we wait for the dust to clear, it is fair to note the obvious logical flaw in Justice Ginsburg’s dissent—it implies that employers adopt selection standards that are not related to a legitimate business necessity.  This could be posited as an abstract proposition, but begs more fundamental questions.  Why should an employer be able to insulate itself from liability by adopting impermissible testing standards or standards that are arbitrary or capricious?  Shouldn’t Title VII’s principles be geared towards encouraging employers to implement reasonable employment practices that are reasonably related to legitimate business needs? Employers get to pick the rules.  Why is it asking too much to expect them to comply with their own rules?

Beyond these questions, the dissent betrays an unsettling trend.  The Court has been bedeviled by affirmative action cases in recent years and reached results that can only be described as legislative and not judicial. The “Michigan cases” (Grutter v. Bollinger and Gratz v. Bollinger) are particularly problematic in that the reasoning was anchored to an indeterminate and shifting view of Equal Protection rights.  These cases were followed by the school desegregation cases in 2007 where the Court split 4-4 in terms of the correct analytical approach.  Four Justices concluded that race-based preferences could be upheld only when narrowly tailored to remedy the effects of past intentional discrimination, and not simply to promote diversity.  These Justices emphasized that policies designed solely to effect racial balancing were “illegitimate.”  Four Justices dissented.  The swing vote proved to be Justice Kennedy who agreed that the particular policies were invalid, but who also opined that promoting diversity could constitute a compelling interest, and thereby left room for the school districts to go back to the drawing board and try to more carefully tailor policies designed to facilitate school desegregation goals.

Students of the Court, scholars, commentators, and lower courts will study Ricci further, and in much great depth than is possible in this brief summary.  Chief Justice Roberts instructed in the school desegregation cases reviewed in the 2006-07 Term, “[t]he way to stop discrimination on the basis of race is to stop discriminating on the basis of race.”   Unless and until the Court and Congress begin to apply Equal Protection principles equally, attempts to bridge the gap between practice and goal will fail.   

The Season tally

In our annual Court preview, we looked at five cases (not counting Gross and Ricci) and finished 4-1 in our predictions.  We deferred making any prediction in Gross.  In Ricci, we predicted the 5-4 outcome.  We close this Term with a 5-1 record.  Predictions are fun to make whether or not the ultimate outcome validates them, but the real point is that predictions can help to identify and discuss trends attracting the Court’s attention. I hope our summaries this year have assisted in that respect.