Supreme Court Clarifies Filing Deadline for Disparate Impact Cases

What is a Disparate Impact Case?

On May 24, 2010, the United States Supreme Court decided another employment law case. Specifically, in Lewis v. City of Chicago, the Supreme Court clarified how to determine if an employee has met the filing deadline to bring a “disparate impact” discrimination case under federal law.

A disparate impact case is one in which an employee claims the employer’s policy has an unequal negative impact based on an unlawful reason. Unlawful factors include race, national origin, gender, age, pregnancy or disability among others.

For example, an employer might use a test to decide which employees it hires or promotes. Even if the employer has no intent to discriminate, the test might disproportionately select fewer employees in a legally protected group. For example, if a significantly lower percentage of African-American or Hispanic job candidates are hired or promoted based on the test results, then the test might be considered to have a disparate impact based on race. A job criteria that has a disparate impact based on an illegal factor violates the law unless the company can prove it has a “business necessity” for using the criteria.

In Lewis, the Supreme Court discussed the filing deadline for a disparate impact case. As a starting point, the Court noted that federal law requires employees to file a Charge of Discrimination with the Equal Employment Opportunity Commission (EEOC) within either 300 days after the discrimination occurred. Otherwise, the employee’s claim will be dismissed. (Note: in some states the EEOC filing deadline is only 180 days).

Other anti-discrimination laws have different filing deadlines. For example, the New Jersey Law Against Discrimination has a 2 year statute of limitations, and both the New York Human Rights Law and the New York City Human Rights Law have 3 year statutes of limitations.

The Lewis Case

Lewis involves the Chicago Fire Department. The Department used a written exam to decide which job candidates it hired. The test undisputedly had a disparate impact against African-American job candidates. Six African-American job applicants filed Charges of Discrimination with the EEOC.

Each of the Charges of Discrimination was filed more than 300 days after Chicago announced how it planned to use the test results. However, Chicago continued to use the test results to hire job candidates for the next six years. At least one of the employees filed a Charge of Discrimination within 300 days after the Department hired a job candidate based on the test results. Accordingly, the trial court found that the Charge of Discrimination was timely.

After a trial, the Court found the test had a disparate impact on the basis of race. It also ruled that the employer did not prove a business necessity for the test. As a result, it ordered the Fire Department to hire 132 African-American employees who had applied for jobs.

On appeal, the Seventh Circuit Court of Appeals reversed. It found the Charge of Discrimination should have been filed within 300 days after the City announced how it planned to use the test results. As a result, it dismissed the case.

But the Supreme Court disagreed, and reinstated the trial judge’s ruling. It found there was a continuing violation, and the Charge of Discrimination was filed on time because it was filed within 300 days after the City used the test results to make a hiring decision. As a result, it reversed the Seventh Circuit’s decision.