Blog: The California Workplace Advisor

Number 8:  The Supreme Court Finds That Unintentional Discrimination Violates Title VII

People don’t discriminate by accident. But in the wake of the passage of Title VII, employers began adopting facially neutral policies which had the effect of discriminating against protected classes.  Before Title VII became law, some employers would overtly discriminate, having a policy that black employees could only work in certain low-paying jobs.  After Title VII’s passage, those same companies tried to create the same effect by, for example,  having employees take IQ tests that they knew racial minorities were unlikely to pass. 

That all changed in 1971 when the Supreme Court decided Griggs v. Duke Power Co., 401 U.S. 424 (1971).  The Griggs Court found that Title VII prohibited not just intentional discrimination based on an individual’s race, color, religion, sex, or national origin, but also unintentional discrimination in the form of neutral or selection testing procedures that had the effect of disproportionately excluding persons based on a protected class when the testing procedures are not job-related and consistent with a business necessity.  Chief Justice Berger, in writing for a unanimous Court, declared that Congress directed the thrust of the Act to the consequences of employment practices, not simply the motivation.  This decision coined the phrase “disparate impact” discrimination.

Of the 14 African Americans employed at Duke Power in North Carolina, 13 sued the Company on the basis that Duke Power’s testing and educational requirements violated Title VII.  In 1955, the Company introduced a policy requiring a high school education for initial assignment to four of its five departments.  On the date that Title VII became effective, July 2, 1965, the Company added a new requirement that new employees seeking employment in four departments obtain satisfactory scores on two professionally prepared aptitude tests, in addition to the existing high school education requirement.  A few months later, the Company began allowing current employees lacking a high school education to qualify for internal transfers by passing two tests – a Wonderlic Personnel Test and the Bennett Mechanical Comprehension Test.  The tests were not designed to measure the individual’s ability to learn a particular job.  The requisite scores approximated the median for high school graduates at a time when it was undisputed that African Americans “received an inferior education in North Carolina.”  There was also no dispute that “whites register far better on the Company’s alternative requirements than Negroes.”

The lower court found that although Duke Power had intentionally discriminated against African Americans, it had stopped this practice after Title VII became effective.  The Court of Appeals concluded there was no violation of Title VII, because the employer had no purpose or intent to discriminate and the testing standards were applied to everyone regardless of race.  In the absence of discriminatory motive, the testing requirements were appropriate.  It rejected the employees’ argument that because the education and testing requirements effectively made a markedly disproportionate number of African Americans ineligible, they were unlawful under Title VII.

The Supreme Court agreed that Duke Power had no discriminatory intent.  However, it held that Title VII is also designed to prohibit practices that have the effect of adversely impacting members of a protected class.  To illustrate his point, Berger turned to Aesop’s fable, The Fox and the Stork.  He wrote, “Congress has now provided that tests or criteria for employment or promotion may not provide equality of opportunity merely in the sense of the fabled offer of milk to the stork and the fox.”  This fable tells the story of the fox who invites the stork to eat with him and provides soup in a bowl.  The fox can lap up the soup easily, but the stork cannot drink the soup with his beak.  In response, the stork invites the fox to a meal served in a narrow-necked vessel.  The stork may access the meal, but it is impossible for the fox to eat using the vessel.  Continuing with his Aesop reference, Justice Berger stated that Congress provided that the vessel in which the milk is proffered be one all seekers can use.  The Act proscribes not only overt discrimination, but also employer practices that are fair in form, but discriminatory in operation.

The standard, the Court explained, is business necessity.  Does the employment practice operate to exclude a protected class while being unrelated to job performance?  If the answer is yes, the practice is prohibited.  Duke Power’s requirement that the employee complete high school and score satisfactorily on general intelligence tests was not shown to bear a demonstrable relationship to successful performance of the jobs being offered.  The Company’s testimony that the requirements were to “improve the overall quality of the work force” were insufficient.  Title VII allows testing mechanisms, but these mechanisms are not allowed to be the controlling force unless they are demonstrably a reasonable measure of job performance.  Congress, the Chief Justice wrote, has not commanded employers prefer the less qualified over the better qualified, simply because of minority origins.  Rather, Congress has made such qualifications the controlling factor, so that race, religion, nationality and sex become irrelevant.  What Congress has commanded is that any tests used must measure the person for the job and not the person in the abstract.

Seven years after Griggs, the EEOC adopted Uniform Guidelines on Employee Selection Procedures (UGESP).  UGESP provides guidance to employers about how to determine if their tests and selection procedures are lawful under the disparate impact theory created by Griggs.  UGESP outlines three different ways employers can show that their employment tests and other selection criteria are job-related and consistent with business necessity.  The EEOC calls these methods of demonstrating job-relatedness “test validation,” and the UGESP provides detailed guidance for employers about each method of test validation.

Duke Power was established in 1900 and still operates today under the name Duke Energy.  According to its website, it is the largest electric power holding company in the United States.