Ricci vs. DeStefano Decision, 129 S.Ct.2658, 2009
On June 29, 2009, the Supreme Court of the United States ruled in Ricci v. DeStefano that the City of New Haven’s failure to certify the results of a civil service exam, on which white firefighters outperformed African American firefighters and would have disqualified any African American firefighters from receiving a promotion after the City concluded the test, was racially biased and therefore unlawful. An important case, it has received attention not only for its legal impact, but because it was an appeal from a second circuit decision by Supreme Court nominee Sonia Sotomajor.
In 2003, the City of New Haven contracted with a third party to develop promotional examinations to fill eight lieutenant and seven captain positions. The top ten scores on the lieutenant exam were all white, and the top nine scores on the captain position were seven whites and two Hispanics. After the results of the exam, the City, noting the lack of any African Americans in the top scores, had concerns of test’s possible “disparate impact” on racial minorities. After an independent exam review board considered the possibility that the tests were racially biased, the City did not to certify the exam and did not make any promotions.
The white applicants who scored highest on the exam sued the City, alleging that the refusal to certify the exam and discarding the promotional test results because of the racial composition of the group of top candidates discriminated against them in violation of Title VII. The City argued that its decision was permissible because it had a good faith belief that, had it certified the test results, it would have violated the disparate impact provision of Title VII. The district and appellate courts ruled for
the City, finding that the white applicants did not have a Title VII claim because the City was trying to comply its Title VII obligations to minority applicants. The Supreme Court reversed and held that the City improperly discriminated on the basis of race when it refused to certify the test.
Title VII prohibits “competing expectations” – the intentional discrimination (disparate treatment) versus the unintentional discrimination that results from facially neutral acts that, while not intended to discriminate, have a disproportionately adverse effect on members of a protected class (disparate impact). Attempting to resolve this tension, the Supreme Court established the “strong basis in evidence” standard to resolve any conflict between the two provisions. The Court held that attempts to avoid disparate impact liability cannot trump what would otherwise be disparate treatment discrimination, unless the employer has a “strong basis in evidence” that it would be liable under disparate impact. To show a “strong basis in evidence,” the City would have had to prove that the promotional exams were not job related and consistent with business necessity, or that it had refused to adopt an equally valid, less discriminatory alternative. To simply reject the test results was “express race- based decision making.”
In Ricci, the City’s race-based rejection of the test did not satisfy the strong basis-in-evidence standard. The Court explained that, “[f]ear of litigation alone cannot justify an employer’s reliance on race to the detriment of individuals who passed the examinations and qualified for promotions.” The Court further stated that the City’s “threshold showing of a significant statistical disparity” was insufficient to meet this strong basis in evidence that it would have been liable for disparate impact under Title VII.
The effects of the Ricci will not be immediately felt or known. There is the possibility that Congress will amend Title VII in attempt to soften the Ricci decision. Whether that – or Title VII disparate impact provisions as currently written – are consistent with the equal protection guarantees and will pass constitutional muster is also up for debate: as Justice Scalia noted, the Court avoided the equal protection constitutional question. Litigation costs will likely go up, as Ricci positioned employers in a Catch-22 where disregarding tests may lead to a disparate treatment claim while certifying the results may lead to a disparate impact claim. Even if, based on the Ricci case, the employer can defend the disparate impact claim, the employer must still spend legal fees in the defense. Finally, Ricci may cause a chilling effect on diversity initiatives for employers.
Despite some uncertainty, Ricci signals that courts should not assume that an employment decision that adversely impacts a minority class or results in a discrepancy in the numbers of a minority class was discriminatory. Companies should also be mindful that while this case was brought against a public employer concerning promotions, this decision is applicable to private employers and affects hiring, firing, and discipline as well.
If you would like a full copy of the opinion, or if you have any other questions related to this decision or any employment matters, please feel free to contact one of our Employment Practice Liability Practice Area Leaders.