Chaidez v. Ford Motor Co., 082819 FED7, 18-2753

Docket Nº:18-2753
Opinion Judge:Manion, Circuit Judge.
Party Name:Martin Chaidez, et al., Plaintiffs-Appellants, v. Ford Motor Company, et al., Defendants-Appellees.
Judge Panel:Before Bauer, Manion, and Brennan, Circuit Judges.
Case Date:August 28, 2019
Court:United States Courts of Appeals, Court of Appeals for the Seventh Circuit

Martin Chaidez, et al., Plaintiffs-Appellants,


Ford Motor Company, et al., Defendants-Appellees.

No. 18-2753

United States Court of Appeals, Seventh Circuit

August 28, 2019

Argued May 23, 2019

Appeal from the United States District Court for the Northern District of Illinois, Eastern Division. No. l:17-cv-03244 - Charles R. Norgle, Judge.

Before Bauer, Manion, and Brennan, Circuit Judges.

Manion, Circuit Judge.

The plaintiffs, on behalf of themselves and those similarly situated, allege a racially discriminatory hiring scheme that has resulted in a lack of Hispanic and Latino line workers at Ford Motor Company's Chicago assembly plant. The district court dismissed the suit for failure to exhaust administrative remedies, holding the plaintiffs' claims were not "like or reasonably related to" the claims asserted in their EEOC charges. Because we conclude that the claims included in Count II of the plaintiffs' complaint were properly exhausted before the EEOC, we vacate the district court's dismissal of Count II and remand for further proceedings. We also modify the district court's dismissal of Count I to be without prejudice.

I. Background

The seven named plaintiffs are Hispanic or Latino individuals who applied for employment as line workers at Ford's Chicago assembly plant near Harvey, Illinois, but were not hired. Allan Millender is a black Ford employee and the Chairman of the United Auto Workers union for the Chicago plant. The plaintiffs allege a conspiracy between Millender, the staff of the Harvey unemployment office, and unknown Ford employees. This claimed conspiracy ensured the Chicago plant predominantly hired black employees to the exclusion of Hispanic and Latino applicants, allegedly because Mil-lender believed black employees would be more likely to support him in his role as a union leader. This resulted in a predominantly black workforce at the plant and a dearth of Hispanic and Latino workers, despite a sizable minority of Hispanic and Latino people in the surrounding area.1

The complaint alleges line workers at the Chicago plant are hired exclusively through the Harvey unemployment office. The office collects application forms from individuals interested in applying for line worker positions at the Chicago plant. These forms are then sent to Ford, which compiles the information and forwards it to Aon Consulting, a third-party firm that administers a variety of pre-employment tests. One test Aon administers is a basic skills test. Applicants who pass the required pre-employment tests, a drug test, and a background check are sent back to Ford to move forward in the hiring process.

The plaintiffs claim the actual operation of this hiring process, under Millender's influence and control, is discriminatory against Hispanic and Latino applicants. In February 2016, the named plaintiffs each filed an EEOC charge, alleging they were denied employment with Ford based on their race.2These charges were largely, though not entirely, identical. Each alleged Millender established a discriminatory hiring process, setting forth the following allegations: (1) Hispanic and Latino applicants are intentionally discriminated against, or disparately impacted, by the pre-employment basic skills test;

(2) Even those Hispanic and Latino applicants that do pass this test are discriminated against by having their applications "stalled in some other way;"

(3) Those Hispanic or Latino applicants who are considered by Ford are rarely, if ever, hired; and finally

(4) Several non-Hispanic and non-Latino applicants have been hired without taking the basic skills test.

Only one plaintiff (Stephanie Galan) alleged she personally "took a pre-employment basic skills test." The others simply alleged they filled out a pre-application questionnaire and were either never contacted or not ultimately hired. None of the charges alleged the plaintiffs were prevented from taking the basic skills test, or that their contact information was destroyed or mishandled by the unemployment office staff or not forwarded to Aon by Ford. Instead, each charge (even those of the plaintiffs who did not allege they took the basic skills test) included the following allegation: "By agreement with the Harvey unemployment office, Hispanic applicants are allowed to apply and take pre-employment tests, but rarely pass basic skills testing." Thus, the focus of the charges was on the discriminatory impact or administration of the basic skills test, or the intentional stalling of the applications of and/or refusal to hire those applicants who passed the test.

The plaintiffs each received "Right to Sue" letters from the EEOC in January 2017. They commenced this case in federal court in April 2017, seeking to certify it as a class action. They set forth two claims under Title VII: disparate treatment (Count I) and disparate impact (Count II). The complaint contained allegations supporting two alternative theories of discrimination: "Either the pre-employment testing creates an impermissibly adverse impact on Hispanics and/or Latinos, or Ford itself is excluding those of Hispanic and/or Latino descent from being processed for hire."

Paragraphs 22-32 contain allegations supporting the first theory: "the pre-employment testing creates an impermissibly adverse impact on Hispanics and/or Latinos." These paragraphs set forth the following allegations: (1) Ford almost exclusively hires line workers through the Harvey unemployment office;

(2) Most, if not all, of the line workers hired are black;

(3) The plaintiffs each applied for a line worker position through the Harvey unemployment office, and each was qualified for such position, but they were not hired due to their race;

(4) Ford's hiring process results in an almost exclusively black workforce; and

(5) The lack of Hispanic and Latino line workers is inconsistent with local racial demographics.

Paragraphs 33-44 detail the second theory: "Ford itself is excluding those of Hispanic and/or Latino descent from being processed for hire." More specifically, paragraph 33 describes this theory as follows: "Alternatively, ... the Harvey, Illinois unemployment office, at the direction of, and in concert with Millender, either does not accept, or destroys applications or contact information forms from...

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