7th Circuit Reverses Denial of Class Certification for Disparate Impact Subclasses

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On January 6, 2022, the Seventh Circuit Court of Appeals held that the U.S. District Court for the Northern District of Illinois erred in denying class certification to putative subclasses of unsuccessful Black job applicants who alleged that hiring exams used by the Cook County Department of Corrections (“DOC”) resulted in a disparate impact on the basis of race in violation of Title VII. The case is Simpson v. Dart, 21-cv-8028.

Background

Plaintiff sought a position at the DOC on four separate occasions between 2014 and 2017, but his application was rejected each time. The DOC’s hiring process consisted of five stages: (1) an initial written exam; (2) a written situational exam; (3) a physical fitness test; (4) a discretionary review; and (5) a discretionary final review. Plaintiff sued after his rejections, claiming he was denied employment on the basis of his race under disparate treatment and disparate impact theories. Plaintiff moved under Rule 23 to certify a class of all unsuccessful Black DOC applicants going back to 2015 as well as five proposed subclasses consisting of candidates dismissed at each hiring stage. The district court denied his bid for class certification.

Plaintiff appealed the certification ruling pursuant to Rule 23(f) as to the first three subclasses of unsuccessful applicants—i.e., applicants rejected after the written exams and physical fitness tests—and only insofar as those subclasses asserted disparate impact claims.

Seventh Circuit’s Ruling

The Seventh Circuit reversed, holding that the district court’s decision to deny class certification for these subclasses was erroneous in two primary respects:

  1. the district court erred in considering the merits of Plaintiff’s discrimination claims when determining whether class certification was appropriate. In particular, the Seventh Circuit held that the district court should not have considered evidence such as whether the hiring exams had been validated. It noted that regardless of whether Plaintiff’s claims will ultimately fail on the merits: “Where, as here, a plaintiff identifies a discrete employment policy that allegedly results in discrimination, Title VII disparate impact claims are well suited for class wide adjudication: the policy either disparately impacted the plaintiff class or it did not.”
  2. the district court erred in failing to separately analyze Plaintiff’s disparate treatment and disparate impact claims. The Seventh Circuit noted that because disparate treatment claims require proof of intentional discrimination whereas disparate impact claims do not, the commonality requirement may be more difficult to establish in disparate treatment claims. Each claim must be evaluated separately for class certification purposes.

Implications

This ruling may lead to more Rule 23 race-based disparate impact claims being filed within the Seventh Circuit. It also serves as a reminder that employers implementing exam-based hiring criteria should take steps to ensure such exams do not engender a disparate impact on protected classes.

[View source.]

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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