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Third Circuit Finds Newark Hiring Practice Might Discriminate Based on Race

Last week, the Third Circuit Court of Appeals ruled that statistical evidence could be enough to prove that Newark’s residency requirement for its non-uniformed employees has a disparate impact based on race. A disparate impact claim is when someone claims that a seemingly neutral policy has a disproportionately negative impact on a particular legally protected group.

Specifically, in Meditz v. City of Newark, Gregory Meditz sued Newark after it refused to hire him as its Housing Development Analyst because he lives in Rutherford, rather than in Newark, New Jersey. He claims the Newark’s residency requirement for its non-uniformed employees is illegal because it has a disparate impact on non-Hispanic whites, since the population of Newark does not reflect the racial mix of the relevant job market. He alleges that fewer non-Hispanic white employees work for Newark as non-uniformed employees because of the residency requirement.

To support his claim, Mr. Meditz used statistics showing there is a much lower percentage of non-Hispanic white employees who work for Newark in non-uniformed positions (1) than there are in the general population of Newark, (2) than work for Newark in uniformed positions than non-uniformed positions, (3) than work for the government and private companies in Bergen, Essex, Hudson, Morris, Passaic, and Union Counties, and (4) than work for the Essex County government in Newark.

Newark, New Jersey.pngDespite this evidence, the District Court dismissed Mr. Meditz’s employment discrimination lawsuit, finding his statistical evidence was not enough to prove that Newark’s residency requirement has a disparate impact based on race. The lower court relied on the fact that “Newark is New Jersey’s largest city with over 270,000 residents, 38,950 of whom are White.” It concluded that “[g]iven its diversity and large population, there is no need to redefine the relevant labor market past city limits for purposes of Title VII analysis.” Title VII is a federal employment law that prohibits employers from discriminating based on an employee’s race, color, national origin, or gender.

However, the Court of Appeals disagreed and allowed Mr. Meditz to proceed with his case. It found his statistical evidence might be enough to prove that Newark’s residency requirement has a disparate impact based on race. However, it ruled that the District Court has to determine the relevant labor market before it can determine whether Mr. Meditz’s statistics prove his claim. The Third Circuit concluded that the District Court must consider factors including geographic location, available transportation to Newark, commuting patterns, and where employees working for private companies in Newark live.

If Mr. Meditz can prove that Newark’s residency requirement has a disparate impact based on race, then Newark’s only defense would be that it has a “business necessity” for having a residency policy. That means Newark would have to prove that the hiring criteria “must effectively measure the minimum qualifications for successful performance of the job in question.” Otherwise, its residency requirement would have an illegal disparate impact based on race, in violation of Title VII.

Contact an employment law attorney at Rabner Baumgart Ben-Asher & Nirenberg for more information about your employment law rights in New Jersey or New York.