The U.S. Court of Appeals for the Sixth Circuit recently held in Phillips v. Cohen, 400 F.3d 388 (6th Cir. 2005), that the facially neutral criteria the Department of Defense, Defense Finance and Accounting Service, Columbus Center (DFAS-CO) used to determine promotions may have the effect of discriminating against African-American employees. The Sixth Circuit overruled the lower court’s ruling that the plaintiffs failed to establish a disparate impact claim and remanded the case for a jury trial. Disparate impact causes of action penalize employment practices that are “fair in form but discriminatory in operation.” Griggs v. Duke Power Co., 401 U.S. 424, 431 (1971). The promotion procedures at issue in this case are the same as most promotion procedures used by federal agencies.
In 1996, the DFAS-CO newsletter asked why so few African-American employees were in GS/GM 13-15 level positions. Black males (numbering 5) held 4.2 percent of the positions, whereas statistical data suggested they should hold 6.5 percent. Shortly after, DFAS established a team to address minority employees’ concerns. The team concluded that minorities are promoted at lower rates, especially at higher grade levels, also noting: 1) a strong tendency of selecting officials to choose employees from their own ethnic group; 2) minority groups received 23 percent of employee awards, while white employees received 77 percent of awards; 3) black employees received 49 percent of all disciplinary actions; 4) non-minorities “continue to receive the highest percentage of exceptional and high ratings,” and that, “[a]s a mandatory factor in the merit promotion process, these trends reflect unfavorably for minorities.”
In 1998, the plaintiff, on behalf of a group of African-American employees, filed a complaint alleging that the following practices caused a disproportionately low number of African-Americans to receive promotions: detailing; the use of white selecting officials; vesting too much discretion in hiring managers; the manipulation of awards, discipline, and performance reviews; and promoting white candidates who do not meet the grade requirements for the job.
Both Phillips and DFAS-CO hired experts to discern any differences in promotion rates between African-American and white employees. Phillips’ expert found a statistically significant difference between the “promotion rates” for African-Americans (42.23 percent) and for white employees (45.87 percent). The disparity was more marked when rates for African-American women (42.34 percent) and for white women (56.07 percent) were compared. DFAS-CO’s expert found there were greater than expected numbers of promotions of African-American employees in half of the grade levels, and fewer than expected in half, but that there only statistically significant difference in one grade, GS-5. The lower court concluded that plaintiffs had not made out a prima facie case of impact disparity based on this statistical evidence.
The Sixth Circuit looked to the Supreme Court, which in the past rejected rigid mathematical formulas to analyze statistics purporting to show disparate impact. Instead, the court held that the “entire evidence” in the record must be considered in determining whether a claim for discrimination has been proven. The Sixth Circuit then held that several factors viewed in combination are sufficient evidence to defeat summary judgment: (1) evidence that African-American employees are promoted less frequently than white employees; (2) evidence that mandatory factors in the promotions process, such as employee awards and employee discipline, disadvantage African-American employees because of racial differences in application; and (3) evidence that many employees perceive favoritism and a lack of transparency as pervading the promotion process at DFAS-CO. The Sixth Circuit sent the case back to the trial level for a trial.
Lastly, it is important to note that the Sixth Circuit also ruled that an employee who alleges a discriminatory promotion policy due to race/ethnicity cannot bring this type of claim without applying for a promotion first.
** This information is provided by the attorneys at Passman & Kaplan, P.C., a law firm dedicated to the representation of federal employees worldwide. For more information on Passman & Kaplan, P.C., go to http://www.passmanandkaplan.com. **
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