The Future of Disparate Impact

Disparate impact has seen its fair share of controversy in the past year and a last minute deal probably saved the theory it in late 2013.

The Equal Employment Opportunity Commission (EEOC) received lots of attention and a fair amount of criticism when they filed legal complaints against BMW and Dollar General alleging discriminatory practices based upon disparate impacts.  BMW had a hiring process that screened out applicants with a criminal conviction.  Dollar general had a similar policy.  The EEOC alleged even though the policies were not targeting any class of people, African Americans are negatively impacted because of their disproportionate arrest and conviction rate.  The pundits filled both the television and the opinion pages of newspapers arguing for and against the legal strategy.

To magnify the discussion surrounding disparate impact the United States Supreme Court accepted certioari for the 2013 term, Mount Holly v. Mt. Holly Gardens Citizens in Action, Inc., No. 11-1507 (2012), but a private deal was brokered weeks before oral arguments and the case never made it to the justices.  The issue that would have been argued is whether disparate impact claims are applicable under Section 804(a) of the Fair Housing Act (“FHA”). That section makes it unlawful “to refuse to sell or rent after the making of a bona fide offer, or to refuse to negotiate for the sale or rental of, or otherwise make unavailable or deny, a dwelling to any person because of race, color, religion, sex, familial status, or national origin.”  The reason why many people think the court decided to hear the case is at least revise how disparate impact is used in the housing context.  Eleven federal courts of appeals during thirty-eight years have upheld the disparate impact standard in the context of the Fair Housing Act.  Brief for the Respondent, No. 11-1507 at 27-28 (2012).

Disparate impact is used as a tool for determining if there is discrimination.  It is used in cases where there is a facially neutral policy (the policy is applicable to everyone), but the impact negatively affects a class of people.  Even if a neutral practice does have such a disparate impact, a business will not violate Title VII if it can prove that the neutral practice is job related and consistent with business necessity. For a much more in-depth explanation of disparate impact, see my post about the theories of discrimination.

Academics have also chimed on disparate impact as well.  Many of the articles in the current Harvard Civil Rights – Civil Liberties Law Review are centered on disparate impact:

The Agency Roots of Disparate Impact

Assessing HUD’s Disparate Impact Rule: A Practitioner’s Perspective

Banning the Box but Keeping the Discrimination?: Disparate Impact and Employer’s Overreliance on Criminal Background Checks

As for my own personal opinion, I think disparate impact will be used in determining discrimination complaints for the foreseeable future.  Overt discrimination appears less and less.  So being able to produce a document or policy that discriminates against a class of people is more of a relic of the past.  I do not believe discrimination is dead — in fact, far from it.  On the other hand, I also believed that disparate impact is not a perfect tool for evaluating discrimination.  But I think it is a very valuable tool in the arsenal to combat discrimination.




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