Business Is Big Loser In Supreme Court Firefighters Case

Originally posted on July 2, 2009 by Ellen Simon

Supreme Court’s Ricci Decision Is Bad For Business and Everyone Else

It took me almost a whole day to read and digest the 89 page Ricci v. DeStefano decision. I have spent most of a  whole second day reading the commentary and analysis.    

Here’s where I’m at regarding this case:

  • it’s really hard for businesses to deal with   
  • it’s also really bad for everyone else
  • it’s procedurally unsound
  • it’s got to go
Bad For Business

There is a general consensus that business is the big loser in the Ricci decision. Almost without exception, all of the commentary points to the fact that the Supreme Court has now made it harder than ever for employers to follow Title VII law which prohibits discrimination in the workplace. That’s not good.

A described in a Lawyers USA article today, the lawyers who represent employers believe that they have been put in a “lose-lose” situation:

The outcome really puts employers in a box, said Andrew J. Pincus, a partner in the Washington office of Mayer Brown who filed an amicus brief on behalf of the National League of Cities and other groups. Before, employers had some leeway. Under the new standard, they are really in a box because they will be facing costly litigation no matter what they do.

In sum, the Supreme Court in a 5-4 decision found in favor of white firefighters who claimed discrimination because of race when test results for promotions were discarded because no black employees scored high enough to be considered for promotions. The city feared a disparate impact discrimination lawsuit and set aside the test results.

The Court held  that an employer may not discard test results on account of race unless it shows a “strong basis in evidence” that it would be subject to disparate impact liability. Statistics alone are not enough to make a “strong showing in evidence”,  but no one seems to know what is.

As Rae T. Vann,  general counsel for the Equal Employment Advisory Council, which submitted an amicus brief in the case commented:

“I think [the justices] made the situation a little more challenging as far as navigating that Catch-22 because they changed the rules of the game without giving employers the guidance that they need.”

Without knowing just what qualifies as a “strong basis in evidence” of the likelihood of being found liable for creating a disparate impact, many employers will chose not to discard a selection or promotion process that yields few minority candidates once it is in place, possibly drawing a disparate impact suit.

What’s ironic is that this decision came from the Roberts pro business court. Ilya Somin wrote a very interesting piece about the subject in the Volokh Conspiracy and here are some excerpts:

The Supreme Court’s decision in Ricci v. DeStefano has interesting implications for the longstanding debate over whether the Roberts Court is “pro-business.”

The bottom line is that the business interests were among the big losers here. The Court’s ruling makes it difficult for employers to use race-conscious measures to avoid disparate impact liability under Title VII of the Civil Rights Act. And this defeat was inflicted by the supposedly business-friendly conservative justices. Although Ricci addressed promotion decisions by a government employer, the same Title VII standards apply to private employers too.

 If a business adopts a race-neutral hiring or promotion standard that results in few or no minority hires or promotions, it is potentially vulnerable to a disparate impact lawsuit. As several Supreme Court cases make clear, that can happen even if the business was not intentionally trying to disadvantage minorities.

But if the business adopts race-conscious measures to try to shield itself from liability (e.g. – by practicing affirmative action, adopting a standard that is more favorable to minority applicants, and the like), it opens itself up to “disparate treatment” lawsuits by whites, such as one the filed by the New Haven firefighters in Ricci.

No One Seems to Like the Decision

It’s not like anyone else likes the decision either. John Payton, the president of he NAACP Legal Defense Fund said that the Ricci decision is a “step backward from the goal of equal employment opportunity.

The law professors have written excellent articles for the academics and theorists on the many things that are flat out wrong and troubling about the decision. The New York Times Opinionator did a good job of gathering some of them.

One was an excellent analysis on the Workplace Prof Blog by Marcia McCormick. Here’s a piece of it:

As a doctrinal matter, I think that the initial premise is troubling. To say that concern over the possibility of a discriminatory effect is itself a discriminatory motive seems to create a terrible theory of discrimination, a moral equivalence, that automatically pits groups against one another in competition for jobs.

It’s also an implicit rejection of the basis for the Court’s early decisions on Title VII, that discrimination in employment was common, that absent some other good explanation for an adverse action, discrimination was a reasonable explanation for it, and that without incentives, employers would not have to look critically at what was really required to perform a job and whether this individual could do that.

Instead, they could rely on old proxies for fitness without examining them critically. Now it seems that the Court is concluding that discrimination is rare and assertions of discrimination are suspect, and that the continued lack of attainment by people of color (and women, likely) is because of limitations in those people, not obstacles in the system.

Mike Zimmer, law professor at Loyola University and fellow blogger on Today’s Workplaceposted a great in depth piece about the case. He provides hugely helpful insight as well as a road map through the many complex issues presented.

Where’s The Jury?

Mike Zimmer makes one simple point (among the many complex ones) which is the one that jumped out at me throughout my labored reading of the case. How in the world was this case decided without a jury? As Professor Zimmer noted:

The district court, affirmed by the court of appeals, had granted summary judgment for the defendants. Not only did the Supreme Court reject the summary judgment for the defendants but found that plaintiffs were entitled to summary judgment. That means that the Court found that no material facts existed that would justify a trial.

The four slip opinions run a total of 89 pages; 31 pages – 38% of the total — deal with relatively straight forward recitation of facts, most of which are quite contested.  Many more deal with application of facts to law, again with most applications hotly contested. Reading this suggests that the Supreme Court has taken upon itself the role of a trial court.

To say that there are material facts in dispute on a host of determinative issues is an understatement. Reading through the 89 page decision, with all of the long recitations of fact — and all of the diverging views of what that evidence means in light of the new standard set by the Court — would lead a first year law student to conclude that these were issues to be decided by a jury.

All you have to do is read Justice Allito’s concurring opinion and Justice Ginsberg’s dissent  for proof that there are at least two ways of looking at the evidence in the case.

What Happened To The Remand?

I was particularly dumbfounded by the fact that there was no order of remand. Simply stated, the Court decided that a new legal test should be applied to the central issue in the case. The normal procedure would be a remand to the trial court to act in accordance with its pronouncement. It’s altogether strange that this did not happen.  The point was not missed on Justice Ginsburg in her dissent:

The Court stacks the deck further by denying respondents any chance to satisfy the newly announced strong basis-in-evidence standard.  When this Court formulates a new legal rule, the ordinary course is to to remand and allow the lower courts to apply the rule in the first instance. … I see no good reason why the Court fails to follow that course in this case.

The only plausible explanation for the denial of a remand or a jury is that the majority decided which side they wanted to win — and that was the white firefighters.(“empathy” seems to be okay in this instance)  A remand and jury  could put that outcome in jeopardy.

What’s Next?

It’s no surprise that there is already talk of a legislative fix. According to the New America Media today, Eleanor Holmes Norton, a former chairwoman of the Equal Employment Opportunity Commission, said that she will introduce a bill to overturn the Ricci decision.

 Congress has no recourse except to do as we did in the Ledbetter case [the court questioned equal pay for women] and return the statute to its intended meaning. I will begin this process by introducing a bill to accomplish this end when Congress returns.

Between the Gross case this past month and the Ricci case this week, it certainly looks like Congress has its work cut out for it.

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