Nat'l Ass'n for the Advancement of Colored People “NAACP” v. North Hudson Reg'l Fire & Rescue

• Citation: 113 Fair Empl.Prac.Cas. (BNA) 1633,95 Empl. Prac. Dec. P 44358,665 F.3d 464
• Decision Date: 12 December 2011
• Docket Number: 10–3983.,Nos. 10–3965,s. 10–3965
• Parties: The NATIONAL ASSOCIATION FOR THE ADVANCEMENT OF COLORED PEOPLE “NAACP”; the Newark Branch, NAACP; the New Jersey State Conference NAACP; Allen Wallace; Lamara Wapples; Altarik White v. NORTH HUDSON REGIONAL FIRE & RESCUE, a body corporate and politic of State of New Jersey; Alex M. DeRojas; Alexander Rodriguez; Randy Vasquez; Carlos Castillo; Orlando Duque; Pablo Claro, (Intervenors in D.C.)North Hudson Regional Fire & Rescue, a body corporate and politic of the State of New Jersey, Appellant.
• Court: United States Courts of Appeals. United States Court of Appeals (3rd Circuit)

113 Fair Empl.Prac.Cas. (BNA) 1633
665 F.3d 464
95 Empl. Prac. Dec. P 44,358

The NATIONAL ASSOCIATION FOR THE ADVANCEMENT OF COLORED PEOPLE “NAACP”; the Newark Branch, NAACP; the New Jersey State Conference NAACP; Allen Wallace; Lamara Wapples; Altarik White
v.
NORTH HUDSON REGIONAL FIRE & RESCUE, a body corporate and politic of State of New Jersey; Alex M. DeRojas; Alexander Rodriguez; Randy Vasquez; Carlos Castillo; Orlando Duque; Pablo Claro, (Intervenors in D.C.)North Hudson Regional Fire & Rescue, a body corporate and politic of the State of New Jersey, Appellant.

Nos. 10–3965

10–3983.

United States Court of Appeals, Third Circuit.

Argued Sept. 20, 2011.Filed: Dec. 12, 2011.

[665 F.3d 468]

David F. Corrigan [Argued], Keyport, NJ, for Appellants Carlos Castillo, Pablo Claro, Alex Matthew DeRojas, Orlando Duque, Alexander Rodriguez and Randy Vasquez.

Thomas R. Kobin [Argued], John L. Shahdanian, II, Chasan, Leyner & Lamparello, Secaucus, NJ, Thomas B. Hanrahan, River Edge, NJ, for Appellant N. Hudson Regional Fire & Rescue.

David L. Rose [Argued], Yuval Rubinstein, Rose Legal Advocates, Washington, DC, David Ben–Asher, Eugenie F. Temmler, Rabner, Allcorn, Baumgart, Ben–Asher & Tucker, Upper Montclair, NJ, for Appellees NAACP NJ Conference, NAACP Newark Branch, National Association for the Advancement of Colored People, Allen Wallace, Lamara Wapples and Altarik White.Before: FISHER, HARDIMAN and GREENAWAY, JR., Circuit Judges.OPINION OF THE COURT HARDIMAN, Circuit Judge.

This appeal arises under Title VII of the Civil Rights Act of 1964, as amended in 1991. At issue is the legality of a residency requirement for firefighter candidates imposed by North Hudson Regional Fire and Rescue (North Hudson), a fire department comprising five New Jersey municipalities. The United States District Court for the District of New Jersey held the residency requirement invalid because it has a disparate impact on African–American applicants. North Hudson and six Hispanic firefighter applicants appeal the District Court's judgment.

I A. Overview of Firefighter Hiring in New Jersey

New Jersey state law has regulated the hiring of firefighters for nearly a century. The current governing statute, the New Jersey Civil Service Act (Civil Service Act), was enacted in 1986 and establishes rules and procedures governing public employment that are intended to “advance employees on the basis of their relative knowledge, skills and abilities.” N.J. Stat. Ann. 11A:1–2. Among other things, the Civil Service Act requires New Jersey municipalities to fill civil service jobs, including firefighter, pursuant to a process controlled by the New Jersey Department of Personnel (NJDOP).¹ The NJDOP periodically creates, administers, and scores a firefighter examination. It then publishes hiring lists for the individual fire departments, designing each list to account for the hiring preferences a given municipality applies. New Jersey regulations permit local governments to give a hiring preference to their own residents, N.J. Admin. Code § 4A:4–2.11, and numerous municipalities do so.

In some New Jersey municipalities, residency requirements are not only permitted, but judicially mandated. In 1977, the United States Department of Justice sued

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twelve municipalities—Atlantic City, Camden, East Orange, Elizabeth, Hoboken, Jersey City, New Brunswick, Newark, Passaic, Paterson, Plainfield, and Trenton—alleging that they engaged in race-based discrimination with respect to testing and appointments in the hiring and promotion of firefighters. See United States v. New Jersey, Nos. 77–2054, 79–0184 (D.N.J. filed Oct. 4, 1977). The case was settled on May 30, 1980 by a consent decree (Consent Decree) that mandated residency requirements in those twelve municipalities (Consent Decree Municipalities) and remains in effect over thirty years later.²

B. North Hudson's Residency Requirement

Against this historical backdrop, North Hudson was formed in 1998 as a consortium of five municipalities: Guttenberg, North Bergen, Union City, Weehawken, and West New York. At the time North Hudson was formed, each of its member municipalities imposed a residency requirement, so North Hudson continued that practice. The validity of North Hudson's residency requirement is the subject of this appeal.

Like all New Jersey fire departments, North Hudson is subject to the Civil Service Act, which requires it to hire pursuant to statewide NJDOP testing and ranked lists derived therefrom.³ Applicants who pass the written exam undergo a physical test, and the ranked lists are derived from the results of both assessments. These rankings are used to publish eligibility lists. The Civil Service Act requires organizations to hire from the lists in rank order, and pursuant to New Jersey's “Rule of Three,” North Hudson must offer each open position to one of the three highest ranked candidates on the eligibility list provided by the NJDOP. N.J. Stat. Ann. § 11A:4–8; see also In re Foglio, 207 N.J. 38, 22 A.3d 958, 959 (2011) (describing the Rule of Three mandate). As is common practice in New Jersey, the eligibility lists created for North Hudson include only candidates who lived in one of its five member municipalities when they took the written exam (Residents–Only List). Accordingly, North Hudson never sees the names or scores of ineligible non-resident applicants. North Hudson's Residents–Only List also indicates a preference for veterans and accounts for volunteer firefighting experience and other statutorily mandated criteria. After a candidate is selected from the Residents–Only List, North Hudson battalion or deputy chiefs verify the candidate's residency at the time of hiring. Once the candidate has been hired, however, he may live anywhere; some North Hudson firefighters and officers live in neighboring counties or as far as sixty miles away.

As of 2000, the population of North Hudson's member municipalities was

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69.6% Hispanic, 22.9% white non-Hispanic, and 3.4% African–American. In 2008, the Equal Employment Opportunity Commission (EEOC) reported that North Hudson employed 323 full-time employees, including 302 firefighters. North Hudson's firefighter ranks included 240 white non-Hispanics, fifty-eight Hispanics, and two African–Americans.

When this litigation began, North Hudson sought to fill thirty-five to forty new firefighter positions. The six Hispanic applicants who intervened in this case (Intervenors) earned passing scores on the 2006 NJDOP firefighter exam and satisfied North Hudson's residency requirement. Based on their scores on the 2006 exam, Intervenors were ranked twenty-first, twenty-fifth, twenty-sixth, forty-fifth, forty-ninth, and seventieth on North Hudson's Residents–Only List. Given their rankings, Intervenors claim they would have been offered a firefighting job.

C. The Rodriguez Settlement

Like that of many other New Jersey fire departments, the racial composition of North Hudson has been the subject of legal challenge. In 2001, thirteen Hispanic firefighters sued North Hudson for disparate-impact discrimination in promotions. See Rodriguez v. N. Hudson Reg'l Fire & Rescue, No. 01–3153 (D.N.J. filed July 2, 2001). After almost four years of litigation, the parties settled the case. In the settlement agreement ( Rodriguez Settlement), North Hudson agreed to promote four of the plaintiffs, waive length-of-service prerequisites for registering for the next chief/officer exam, and advertise in Spanish and English media to “attract additional qualified applicants of Hispanic/Latino origin.” The Rodriguez Settlement imposed no other hiring obligations on North Hudson, however. Although the Rodriguez Settlement dealt primarily with promotional practices, the advertising initiatives may have increased Hispanic hiring. Whereas in 2001 the Rodriguez plaintiffs alleged that only 7% of North Hudson firefighters were Hispanic, in 2007, 38% of new hires were Hispanic, and by 2008, the percentage of Hispanic North Hudson firefighters had climbed to 19%. None of the Plaintiffs or the Intervenors in this appeal was a party to the Rodriguez case.

D. NAACP's Disparate–Impact Claim

In April 2007, the Newark Branch of the NAACP, the New Jersey Conference of the NAACP, and firefighter candidates Allen Wallace, Lamara Wapples, and Altarik White (collectively, NAACP Plaintiffs) sued North Hudson alleging that its residency requirement causes a disparate impact on African–American applicants. In February 2009, the District Court certified the NAACP Plaintiffs' class and preliminarily enjoined North Hudson from hiring firefighters from its then-current eligibility list, which included only those candidates who were residents of the North Hudson municipalities when they took the statewide exam. NAACP v. N. Hudson Reg'l Fire & Rescue, 255 F.R.D. 374 (D.N.J.2009). North Hudson filed an interlocutory appeal.

While that appeal was pending, in June 2009, the Supreme Court decided Ricci v. DeStefano, 557 U.S. 557, 129 S.Ct. 2658, 174 L.Ed.2d 490 (2009), and in September 2009, the District Court permitted six Hispanic firefighters eligible for hiring based on North Hudson's then-current list to intervene. Because Ricci involved the interplay between disparate-impact and disparate-treatment claims, we remanded the case sua sponte to the District Court in March 2010.

On April 23, 2010, the District Court found that North Hudson's residency requirement

[665 F.3d 471]

might be lawful because of “business necessity.” Based on that finding and equitable considerations, the District Court vacated the preliminary injunction.

After the preliminary injunction was vacated, the parties moved for summary judgment. The NAACP Plaintiffs sought judgment on their disparate-impact claim and a permanent injunction against North Hudson's use of the Residents–Only List. North Hudson argued that the NAACP Plaintiffs failed to establish a causal relationship between the residency...