854 N.W.2d 1 (Iowa 2014), 12-0913, Pippen v. State

Docket Nº:12-0913
Citation:854 N.W.2d 1
Opinion Judge:APPEL, Justice.
Party Name:LINDA PIPPEN, et al., On Behalf of Themselves and All Others Similarly Situated, Appellants, v. THE STATE OF IOWA, et al., and ALL OTHER AGENCIES SIMILARLY SITUATED IN USING THE HIRING AND PROMOTION OF ADMINISTRATIVE SERVICES, Appellees
Attorney:Thomas A. Newkirk and Leonard E. Bates of Newkirk Law Firm, P.L.C., Des Moines; J. Bryan Wood of Law Office of J. Bryan Wood, Chicago, Illinois; and David H. Goldman and Michael J. Carroll of Babich Goldman, P.C., Des Moines, for appellants. Thomas J. Miller, Attorney General, Jeffrey S. Thompson...
Judge Panel:APPEL, Justice. All justices concur except Waterman, Mansfield, and Zager, JJ., who concur specially. All justices concur except Waterman, Mansfield, and Zager, JJ., who concur specially. WATERMAN, Justice (concurring specially). Mansfield and Zager, JJ., join this special concurrence.
Case Date:July 18, 2014
Court:Supreme Court of Iowa
 
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854 N.W.2d 1 (Iowa 2014)

LINDA PIPPEN, et al., On Behalf of Themselves and All Others Similarly Situated, Appellants,

v.

THE STATE OF IOWA, et al., and ALL OTHER AGENCIES SIMILARLY SITUATED IN USING THE HIRING AND PROMOTION OF ADMINISTRATIVE SERVICES, Appellees

No. 12-0913

Supreme Court of Iowa

July 18, 2014

As Amended October 23, 2014.

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[Copyrighted Material Omitted]

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Appeal from the Iowa District Court for Polk County, Robert J. Blink, Judge. The plaintiffs appeal from an adverse district court judgment after a trial in a class action brought under both the Federal Civil Rights Act and the Iowa Civil Rights Act against the State of Iowa and various executive branch departments, generally alleging that the State unlawfully discriminates against African Americans in employment.

Thomas A. Newkirk and Leonard E. Bates of Newkirk Law Firm, P.L.C., Des Moines; J. Bryan Wood of Law Office of J. Bryan Wood, Chicago, Illinois; and David H. Goldman and Michael J. Carroll of Babich Goldman, P.C., Des Moines, for appellants.

Thomas J. Miller, Attorney General, Jeffrey S. Thompson, Deputy Attorney General, and Julia S. Kim and Tyler M. Smith, Assistant Attorneys General, for appellees.

Jill R. Gaulding and Lisa C. Stratton, St. Paul, Minnesota, and Mark D. Sherinian of Sherinian & Hasso Law Firm, West Des Moines, for amicus curiae Gender Justice.

Kim M. Keenan, Baltimore, Maryland, for amicus curiae National Association for the Advancement of Colored People.

Russell E. Lovell II, Des Moines, for amicus curiae Iowa/Nebraska State Conference NAACP.

Joshua P. Thompson, Sacramento, California, and Aaron T. Oliver and Jay D. Grimes of Hansen, McClintock & Riley, Des Moines, for amicus curiae Pacific Legal Foundation.

APPEL, Justice. All justices concur except Waterman, Mansfield, and Zager, JJ., who concur specially.

OPINION

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APPEL, Justice.

In this case, we consider an appeal from a district court judgment after a lengthy trial adverse to the plaintiffs in a class action brought under both the Federal Civil Rights Act and the Iowa Civil Rights Act against the State of Iowa and various executive branch departments. The plaintiffs generally allege that the State of Iowa unlawfully discriminates against African Americans in employment. For the reasons expressed below, we affirm the decision of the district court.

I. Factual and Procedural Background.

There are thirty-seven departments within the executive branch of the State of Iowa. Each exercises its own hiring authority. The State employs a merit hiring system, which establishes " a system of human resource administration based on merit principles and scientific methods to govern the appointment, compensation, promotion, welfare, development, transfer, layoff, removal, and discipline of its civil employees, and other incidents of state employment." Iowa Code § 8A.411(1). The Code further directs that " [a]ll appointments and promotions to positions covered by the state merit system shall be made solely on the basis of merit and fitness, to be ascertained by examinations or other appropriate screening methods." Id. § 8A.411(3).

The Iowa Department of Administrative Services (DAS) is responsible for ensuring that hiring decisions are made in accordance with the merit system. See id. § 8A.104(12) (" The director [of DAS] shall . . . [e]xamine and develop best practices for the efficient operation of government and encourage state agencies to adopt and implement these practices." ). DAS is tasked with providing rules for the departments to follow. See id. § 8A.413(1) (DAS adopts rules for the administration of the merit employment system). DAS collects statewide data and monitors compliance. In order to comply with the stated goals of the merit system, DAS has a wide range of options, including retaining independent consultants.1 Upon request, DAS assigns personnel officers as human resource advisors to various departments to assist with employment functions, such as providing materials and training, helping develop screening tools, and assisting with hiring.

Applicants to executive branch positions, as well as current employees applying for promotions, submit applications to DAS, either online or by hard copy. DAS maintains electronic data on every applicant and application in their database, the BrassRing.2 The district court summarized

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the hiring system as employing three separate decision-making steps: (1) " DAS receives applications for merit-covered job posting, screens those applications for basic eligibility of the job classification, and refers eligible applicants to the hiring department" (emphasis omitted) (referral); (2) " the hiring department screens the referred applicants for the job-title specific requirements, determines which candidates to interview" (interview selection); and (3) " the hiring department interviews the selected candidates and decides which candidate to offer the job" (hire or promotion).

Although all departments follow the general practices of the merit system, their practices in the hiring process vary. These varied practices include: using a second ré sumé screen, requiring candidates to more fully explain how their experiences qualify them for a specific job function, or requiring a typing test. Each department maintains data relating to each applicant, which is stored in paper hiring files, unlike the DAS data system, which is electronic. Each paper hiring file contains a BrassRing registration number so a correlation between a specific job posting and the applicant's performance on the screening devices and/or interview records can be correlated.

In this case, fourteen 3 African-American plaintiffs brought a lawsuit under both Title VII of the Civil Rights Act of 1964, as amended, 42 U.S.C. § 2000e-2000e-17 (2006), and the Iowa Civil Rights Act of 1965, as amended, Iowa Code chapter 216.

In their petition, the plaintiffs alleged that the State of Iowa, including the thirty-seven different executive branch departments, engaged in practices that resulted in a failure to maintain a diverse, nondiscriminatory workplace through its merit employment system. The plaintiffs contend that because of the State's failure to enforce extant statutory and regulatory policies, a disproportionate number of African Americans were denied an equal opportunity for employment. They claim this was the natural unintended consequences of the State's failure to follow rules designed to ensure equal opportunity in the workplace and was not done intentionally or with malice.

Further, the plaintiffs alleged that in May of 2006 they provided the State of Iowa with a document entitled " Initial Evidentiary Report," alleging systemic racial bias and a pattern of retaliation by top managers and officials of the State of Iowa. The plaintiffs further alleged that the State hired a consultant to study employment practices in late 2006 or early 2007 who produced a report known as the CPS Report. The plaintiffs alleged that the Initial Evidentiary Report and the CPS Report put the State on notice that the hiring practices of the State imposed barriers to equal employment opportunities for African Americans.

On September 28, 2010, on stipulation of the parties, the district court ordered certification of the case as a class action. The class definition and class claim were:

CLASS DEFINITION:

All African American applicants or employees who sought appointment to or held a merit-system position with an Executive Branch agency (not including Board of Regents) at any point from July 1, 2003 through [date of Court's decision regarding liability].

CLASS CLAIM:

Disparate Impact or Adverse Impact discrimination with respect to hiring and promotion decisions and/or unequal terms and conditions of

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employment associated with those decisions under Title VII and the Iowa Civil Rights Act arising from subjective, discretionary decision-making permitted by the State's abdication of statutory or regulatory responsibilities and obligations and/or failure to follow its own policies.

The case came to trial on September 12, 2011. The plaintiffs offered evidence relating to the efforts of the State to document its employment practices, expert testimony by a statistical expert, labor economist Mark Killingsworth, social science testimony from psychology professors Anthony Greenwald and Cheryl Kaiser, testimony from DAS representatives and personnel, and anecdotal testimony from various plaintiffs related to their experience with state government.

In support of the plaintiffs' claims, Killingsworth testified that based on his statistical work employing conventional and probit regression analysis 4 statistical procedures, African Americans were treated differently and more disadvantageously than whites with respect to the referral of applications by DAS for interviews, with respect to the selection for interviews by various agencies and departments, and with respect to ultimate hiring. Further, he opined that once hired, African Americans have lower salaries within a given job title or are hired for job titles that pay less than others, and were treated differently in performance evaluations. In making his calculations, Killingsworth only analyzed applicants who had been deemed by DAS to meet the minimum qualifications for the job classification and had been referred to departments. He approached the data from a variety of perspectives, as his analytical models could include or exclude different variables. Regarding the separability of the elements in the hiring process, Killingsworth testified:

[I]t's not that it's incapable of being separated, but I think there are very serious...

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