Disparate Impact-Treatment Case Study

Disparate Impact

Disparate impact is a methodology for establishing that an employer has engaged in discrimination against a specific group of employees or job applicants of the same race, ethnicity, religion or sex that does not require evidence that the employer intended to discriminate. In Smith v. City of Jackson, Mississippi, 125 S. Ct. 1536 (2005), the United States Supreme Court has held that claims under the ADEA may be brought under a disparate impact analysis.

In this case the city of Jackson Mississippi put into place a new pay plan for police officers and in revising its employee pay plan, the city granted raises to all police officers and police dispatchers in an attempt to bring their starting salaries up to the regional average. Officers with less than five years' service received proportionately greater raises than those with more seniority, and most officers over 40 had more than five years of service. A group of older officers, filed suit under the Age Discrimination in Employment Act of 1967 (ADEA), claiming that they were adversely affected by the plan because of their age. The District Court granted the City summary judgment. The Fifth Circuit affirmed that judgment ruling that disparate-impact claims are categorically unavailable under the ADEA. The decision of Fifth Circuit assumed that the facts alleged by the older officers would entitle them to relief under Griggs v. Duke Power Co., 401 U.S. 424, which announced a disparate-impact theory of recovery for cases brought under Title VII of the Civil Rights Act of 1964 (Title VII).

Smith v. City of Jackson, Mississippi, 125 S. Ct. 1536 (2005) was argued in front of the Supreme Court on November 3rd, 2004 and a decision was delivered on March 30th, 2005. Justice Stevens delivered the opinion of the court and held that the ADEA authorizes recovery in disparate-impact cases comparable to Griggs. Except for the substitution of "age" for "race, color, religion, sex, or national origin," the language of ADEA and Title VII is identical. Unlike Title VII, however, ADEA significantly narrows its coverage by permitting any "otherwise prohibited" action "where the differentiation is based on reasonable factors other than age".

In its' reasoning the court held that the officers did not set forth a valid disparate-impact claim. Two textual differences between the ADEA and Title VII make clear that the disparate-impact theory's scope is narrower under the ADEA than under Title VII. One is the RFOA provision. The other is the amendment to Title VII in the Civil Right Act of 1991, which modified the court's Wards Cove Packing Co. v. Atonio, 490 U.S. 642, holding that narrowly construed the scope of liability on a disparate-impact theory. Because the relevant 1991 amendments expanded Title VII's coverage but did not amend the ADEA or speak to age discrimination, Wards Cove's pre-1991 interpretation of Title VII's identical language remains applicable to the ADEA. Congress' decision to limit the ADEA's coverage by including the RFOA provision is consistent with the fact that age, unlike Title VII's protected classifications, not uncommonly has relevance to an individual's capacity to engage in certain types of employment. In Smith the plaintiffs have done little more than point out that the pay plan is relatively less generous to older workers than to younger ones. They did not, as required by Wards Cove, identify any specific test, requirement, or practice within the pay plan that has an adverse impact on older workers.

Justice Stevens went on in the decision upholding the summary judgment for the city of Jackson, Mississippi, by stating, "The record makes clear that the City's plan was based on reasonable factors other than age. The City's explanation for the differential between older and younger workers was its perceived need to make junior officers' salaries competitive with comparable positions in the market. Thus, the disparate impact was attributable to the City's decision to give raises based on seniority and position. Reliance on these factors is unquestionably reasonable given the City's goal".

This ruling affects employees bringing disparate impact claims against employers using ADEA for their discrimination claim. In Smith v. City of Jackson, Mississippi, 125 S. Ct. 1536 (2005), the United States Supreme Court has held that claims under the ADEA may be brought under a disparate impact analysis. The Court provided a defense to employers in age discrimination cases that are not available to employers in Title VII cases, and thus plaintiffs pursuing disparate impact claims under the ADEA will have a significantly more difficult task of prevailing than have Title VII plaintiffs. In Smith the Supreme Court affirmed summary judgment for the employer on the disparate impact claim.

Disparate Treatment

Disparate treatment exists when an employer intentionally treats some individuals differently or less favorably than others and the different treatment occurs because of the individual's "protected status" (e.g. race, sex, disability, etc.). Disparate treatment alleges intentional discrimination, i.e. that the decision-maker's actions were motivated or influenced by bias because of race, sex, disability, etc.

In Coleman v. School Bd. of Richland Parish, 2005 WL 1714369 (5th Cir. July 25, 2005), the United States Court of Appeals for the Fifth Circuit, applying Louisiana law, held that the intentional acts exclusion in an educators legal liability policy precluded coverage for alleged racial discrimination and harassment against an insured that was premised on "disparate treatment".

In this case Mrs. Coleman, an African-American woman, was hired as the associate principal at an elementary school in September 2000. The school board in October 2000 asked Mrs. Coleman to resign. When she refused to resign, the school held a hearing to consider nine charges of insubordination against her. The board found her guilty of four charges and terminated her employment. Mrs. Coleman brought suit against the board, alleging that white school board members created the associate principal position as a "concession" so that African-Americans would campaign for a school bond proposal in the African-American community. According to Coleman, the day after the bond proposal passed she was asked by the school superintendent to resign. When she refused to resign, the board allegedly threatened to "ruin her career" and began to write her up for false work violations. In her complaint, the woman alleged racial discrimination in violation of Title VII of the Civil Rights Act as well as state law causes of action