U.S. High Court Allows Disparate-Impact Lawsuits

WASHINGTON, D.C. — (Mealey’s) An individual who fails to file a timely charge challenging the adoption of an employment practice may file a disparate-impact claim challenging an employer’s later application of that practice as long as the individual alleges each of the elements of such a claim, the U.S. Supreme Court ruled unanimously May 24 (Arthur L. Lewis, Jr., et al. v. City of Chicago, Illinois, No. 08-974, U.S. Sup.).

Arthur Lewis Jr. and others sued the City of Chicago in 1998, claiming that the entrance exam given to Chicago Fire Department applicants in 1995 discriminated against black applicants.  They alleged that the city, via the exam's 89-point cutoff for well-qualified applicants, created a pool of 1,782 candidates that was five times more white than black.  The hiring method, the plaintiffs alleged, violated Title VII of the Civil Rights Act of 1964.

U.S. Judge Joan B. Gottschall of the Northern District of Illinois ruled in March 2005 that the entrance exam was discriminatory.  However, the Seventh Circuit U.S. Court of Appeals reversed, finding that the suit was untimely.  The appellate panel held that the Equal Employment Opportunity Commission charge for disparate impact discrimination needed to be filed within 300 days of the announcement of the practice.  The Seventh Circuit held that the Third and Sixth Circuit U.S. Courts of Appeal agreed with that approach.  However, the Second, Fifth, Ninth, 11th and D.C. Circuits disagreed.  Lewis and the other plaintiffs petitioned the high court.

Justice Antonin Scalia wrote for the high court, “The City and its amici warn that our reading will result in a host of practical problems for employers and employees alike.  Employers may face new disparate-impact suits for practices they have used regularly for years.  Evidence essential to their business-necessity defenses might be unavailable (or in the case of witnesses’ memories, unreliable) by the time the later suits are brought.  And affected employees and prospective employees may not even know they have claims if they are unaware the employer is still applying the disputed practice.

“Truth to tell, however, both readings of the statute produce puzzling results.  Under the City’s reading, if an employer adopts an unlawful practice and no timely charge is brought, it can continue using the practice indefinitely, with impunity, despite ongoing disparate impact.  Equitable tolling or estoppel may allow some affected employees or applicants to sue, but many others will be left out in the cold.  Moreover, the City’s reading may induce plaintiffs aware of the danger of delay to file charges upon the announcement of a hiring practice, before they have any basis for believing it will produce a disparate impact.”

[Editor's Note:  Full coverage will be in the June issue of Mealey’s Employment Law.  In the meantime, the opinion is available at www.mealeysonline.com or by calling the Customer Support Department at 1-800-833-9844.  Document #73-100611-006Z.  For all of your legal news needs, please visit www.lexisnexis.com/mealeys.]

For more information, call editor Bajeerah LaCava at 610-205-1102, or e-mail her at bajeerah.lacava@lexisnexis.com.