Atonio v. Wards Cove Packing Co., Inc.

• Decision Date: 02 September 1987
• Docket Number: 84-3527,Nos. 83-4263,s. 83-4263
• Citation: 827 F.2d 439
• Parties: 47 Fair Empl.Prac.Cas. 163, 44 Empl. Prac. Dec. P 37,367 Frank ATONIO, Eugene Baclig, Randy del Fierro, Clarke Kido, Lester Kuramoto, Alan Lew, Curtis Lew, Robert Morris, Joaquin Arruiza, Barbara Viernes, as administratrix of the estate of Gene Allen Viernes, and all others similarly situated, Plaintiffs-Appellants, v. WARDS COVE PACKING COMPANY, INC., Castle & Cooke, Inc., and Columbia Wards Fisheries, Defendants-Appellees.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 439

827 F.2d 439

47 Fair Empl.Prac.Cas. 163,

44 Empl. Prac. Dec. P 37,367

Frank ATONIO, Eugene Baclig, Randy del Fierro, Clarke Kido Lester Kuramoto, Alan Lew, Curtis Lew, Robert Morris Joaquin Arruiza, Barbara Viernes, as administratrix of the estate of Gene Allen Viernes, and all others similarly situated, Plaintiffs-Appellants, v. WARDS COVE PACKING COMPANY, INC., Castle & Cooke, Inc., and Columbia Wards Fisheries, Defendants-Appellees.

Nos. 83-4263, 84-3527.

United States Court of Appeals, Ninth Circuit.

Argued and Submitted Feb. 18, 1986.

En Banc Opinion Feb. 23, 1987.

Decided Sept. 2, 1987.

Abraham A. Arditi, Seattle, Wash., for plaintiffs-appellants.

Douglas M. Fryer, Douglas M. Duncan, Seattle, Wash., for defendants-appellees.

Bill Lann Lee, Los Angeles, Cal., and Robert Williams, Washington, D.C., for amicus curiae.

Appeal from the United States District Court for the Western District of Washington.

Before CHOY, ANDERSON, and TANG, Circuit Judges.

TANG, Circuit Judge:

I.

Former salmon cannery workers sued their employers for discrimination on the basis of race, advancing both disparate treatment and disparate impact claims under Title VII of the Civil Rights Act of 1964, 42 U.S.C. Sec. 2000e et seq., and the Civil Rights Act of 1866, 42 U.S.C. Sec. 1981. The district court declined to apply disparate impact analysis to certain subjective employment practices and this panel affirmed that decision. Atonio v. Wards Cove Packing Co., 768 F.2d 1120, 1132 & n. 6 (9th Cir.1985), withdrawn, 787 F.2d 462 (9th Cir.1985). An en banc panel decided that "disparate impact analysis may be applied to challenge subjective employment practices or criteria provided the plaintiffs have proved a causal connection between those practices and the demonstrated impact on members of a protected class." Atonio, 810 F.2d 1477, 1482 (9th Cir.1987) (en banc). The en banc panel returned the cause to this panel to reconsider the district court's disposition of the plaintiffs' claims. Id. at 1486.

In our prior decisions we have presented the factual background of this case in considerable detail, and we will not repeat it here. See Atonio, 768 F.2d at 1122-24. We have also explained the legal principles governing analysis of Title VII disparate treatment claims. Id. at 1124-31. The en banc panel adopted the rule that disparate impact analysis may be applied to the "subjective" employment practices challenged in this case, but it did not explain in any detail how the analysis should be applied. See Atonio (en banc), 810 F.2d at 1482. We now provide that explanation, in light of the reasoning and rationale of the en banc panel in adopting impact analysis.

DISPARATE IMPACT ANALYSIS

A class claim of disparate impact is essentially an allegation that a disparity in the position of nonwhites and whites, often proved through statistical evidence, is "the systemic result of a specific employment practice that cannot be justified as necessary to the employer's business." Segar v. Smith, 738 F.2d 1249, 1267 (D.C.Cir.1984), cert. denied, 471 U.S. 1115, 105 S.Ct. 2357, 86 L.Ed.2d 258 (1985). The quantity and quality of statistical evidence which will give rise to an inference that the disparity is caused by the employer's practices is the same as that which will give rise to an inference of discriminatory intent. Id.

The crucial difference between a disparate treatment and a disparate impact allegation is the intermediate burden on the employer. To rebut the prima facie showing of disparate impact the employer may refute the statistical evidence as in the treatment claim and show that no disparity exists. But if the employer defends by explaining the reason for the disparity he must do more than articulate that reason. He must prove the job relatedness or business necessity of the practice. Albemarle Paper Co. v. Moody, 422 U.S. 405, 425, 95 S.Ct. 2362, 2375, 45 L.Ed.2d 280 (1975). The Supreme Court's decision in Texas Dep't of Community Affairs v. Burdine, 450 U.S. 248, 253, 101 S.Ct. 1089, 1093, 67 L.Ed.2d 207 (1981), that the burden of persuasion always stays with the plaintiff in a treatment case expressly preserved the different allocation of burdens in an impact case. The Court stated that it "recognized that the factual issues, and therefore the character of the evidence presented, differ when the plaintiff claims that a facially neutral employment policy has a discriminatory impact on protected classes." Id. 450 U.S. at 252 n. 5, 101 S.Ct. at 1093 n. 5.

Precisely what the employer must prove will vary with the unique factors of different job settings, but "[t]he touchstone is business necessity." Griggs v. Duke Power Co., 401 U.S. 424, 431, 91 S.Ct. 849, 853, 28 L.Ed.2d 158 (1971). Business necessity of employee selection criteria may be shown by demonstrating that the selection criteria applied are essential to job safety or efficiency, Dothard v. Rawlinson, 433 U.S. 321, 331 n. 14, 97 S.Ct. 2720, 2728 n. 14, 53 L.Ed.2d 786 (1977), or correlated with success on the job. Contreras v. City of Los Angeles, 656 F.2d 1267, 1280 (9th Cir.1981), cert. denied, 455 U.S. 1021, 102 S.Ct. 1719, 72 L.Ed.2d 140 (1982). In short, the employer must demonstrate the "manifest relationship" between the challenged practice and job performance. Griggs, 401 U.S. at 432, 91 S.Ct. at 854. Job relatedness is thus the means of proving "business necessity" when the purpose of a criterion is to predict the capacity of particular individuals to perform a job successfully.

When other employment practices are challenged, whose purpose is not to predict successful job performance, business necessity turns on proof of the burden or benefit to the business of the practice under scrutiny. See Schlei and Grossman, Employment Discrimination Law, 1329 (2d ed. 1983). Business necessity means more than a business purpose. Business necessity requires that a practice "must substantially promote the proficient operation of the business." Chrisner v. Complete Auto Transit, Inc., 645 F.2d 1251, 1262 (6th Cir.1981). See also, Williams v. Colorado Springs School District No. 11, 641 F.2d 835, 842 (10th Cir.1981) ("The practice must be essential, the purpose compelling."). Accord Crawford v. Western Electric Co., Inc., 745 F.2d 1373 (11th Cir.1984); Kirby v. Colony Furniture Co., 613 F.2d 696, 705 n. 6 (8th Cir.1980); Parson v. Kaiser Aluminum & Chemical Corp., 575 F.2d 1374, 1389 (5th Cir.1978), cert. denied, 441 U.S. 968, 99 S.Ct. 2417, 60 L.Ed.2d 1073 (1979); Head v. Timken Roller Bearing Co., 486 F.2d 870, 879 (6th Cir.1973); Robinson v. Lorillard Corp., 444 F.2d 791, 798 (4th Cir.), cert. dismissed, 404 U.S. 1006, 92 S.Ct. 573, 30 L.Ed.2d 655 (1971)

After the employer proves the business necessity of his practices, the plaintiff class has the opportunity to demonstrate that other employment practices or selection devices could serve the employer's needs with a lesser impact on the protected class. Moody, 422 U.S. at 425, 95 S.Ct. at 2375; Moore v. Hughes Helicopters, Inc., 708 F.2d 475, 481 (9th Cir.1983); Chrisner, 645 F.2d at 1263. Whether the plaintiffs' proposed alternative rebuts, or should prevail over, the employer's proof of the business necessity of the original practice is then the ultimate determination to be made.

APPLICATION OF IMPACT ANALYSIS

A. Standard of Review

The ultimate finding of no discriminatory intent in a Title VII action is a factual finding that may be overturned on appeal only if it is clearly erroneous. Fed.R.Civ.P. 52(a); Anderson v. City of Bessemer, 470 U.S. 564, 573, 105 S.Ct. 1504, 1511, 84 L.Ed.2d 518 (1985); Pullman Standard v. Swint, 456 U.S. 273, 102 S.Ct. 1781, 72 L.Ed.2d 66 (1982); Gibbs v. Pierce County Law Enforcement Support Agency, 785 F.2d 1396, 1401 (9th Cir.1986). See also Kimbrough v. Secretary of the United States Air Force, 764 F.2d 1279, 1281 (9th Cir.1985) ("After a Title VII case is fully tried, we review the decision under the clearly erroneous standard applicable to factual determination."). Under the clearly erroneous test, this court must affirm the district court's determination unless "left with the definite and firm conviction that a mistake has been committed." Gibbs, 785 F.2d at 1401 (quoting United States v. United States Gypsum Co., 333 U.S. 364, 395, 68 S.Ct. 525, 542, 92 L.Ed. 746 (1948)). The " 'district court must decide which party's explanation of the employer's motivation it believes.' We will reverse that factual determination only if it is clearly erroneous ... and we will not ransack the record, searching for mistakes." Casillas v. United States Navy, 735 F.2d 338, 342-343 (9th Cir.1984) (quoting United States Postal Service Bd. v. Aikens, 460 U.S. 711, 716, 103 S.Ct. 1478, 1482, 75 L.Ed.2d 403 (1983)).

Of course, we review legal questions de novo. United States v. McConney, 728 F.2d 1195, 1201 (9th Cir.) (en banc), cert. denied, 469 U.S. 824, 105 S.Ct. 101, 83 L.Ed.2d 46 (1984). The conclusion a district court reaches about whether a Title VII plaintiff has satisfied the elements of a prima facie case is reviewed de novo. See, e.g., Clady v. Los Angeles County, 770 F.2d 1421, 1427 (9th Cir.1985), cert. denied, --- U.S. ----, 106 S.Ct. 1516, 89 L.Ed.2d 915 (1986); Thorne v. City of El Segundo, 726 F.2d 459, 464 n. 5 (9th Cir.1983), cert. denied, 469 U.S. 979, 105 S.Ct. 380, 83 L.Ed.2d 315 (1984), appeal after remand, 802 F.2d 1131 (9th Cir.1986); Gay v. Waiters' and Dairy Lunchmen's Union, 694 F.2d 531, 540-45 & n. 13 (9th Cir.1982). We have also suggested, without deciding the question, that the appropriate standard for reviewing the lower court's conclusion at the third stage of a discriminatory treatment case--proving that an employer's proffered explanation for differential treatment is mere pretext--is also subject to de novo review. Thorne, 726 F.2d at 465 & n. 6.

B. The Class Claims

As the en banc panel emphasized, a class action pattern and practice case is...