West Virginia University/West Virginia Bd. of Regents v. Decker

• Decision Date: 08 July 1994
• Docket Number: No. 22100,22100
• Citation: 191 W.Va. 567,447 S.E.2d 259
• Parties: , 69 Fair Empl.Prac.Cas. (BNA) 437, 93 Ed. Law Rep. 984 WEST VIRGINIA UNIVERSITY/WEST VIRGINIA BOARD OF REGENTS, Respondent Below, Appellant, v. Robert L. DECKER and the West Virginia Human Rights Commission, Complainants Below, Appellees.
• Court: West Virginia Supreme Court

Page 259

447 S.E.2d 259

191 W.Va. 567, 69 Fair Empl.Prac.Cas. (BNA) 437,

93 Ed. Law Rep. 984

WEST VIRGINIA UNIVERSITY/WEST VIRGINIA BOARD OF REGENTS, Respondent Below, Appellant, v. Robert L. DECKER and the West Virginia Human Rights

Commission, Complainants Below, Appellees.

No. 22100.

Supreme Court of Appeals of

West Virginia.

Submitted May 11, 1994.

Decided July 8, 1994.

Syllabus by the Court

1. In view of the language and purpose of the Human Rights Act, W.Va.Code 5-11-1 [1967] et seq., as it now stands, and the language of this Court in Guyan Valley Hospital, Inc. v. West Virginia Human Rights Comm'n, 181 W.Va. 251, 382 S.E.2d 88 (1989), we now hold that there is a cause of action for "disparate impact" that applies equally to all claims arising under W.Va.Code, 5-11-1 [1967] et seq., including age based discrimination.

2. To the extent that Guyan Valley Hospital, Inc. v. West Virginia Human Rights Comm'n, 181 W.Va. 251, 382 S.E.2d 88 (1989), established the standard for proving disparate impact under the West Virginia Human Rights Act, W.Va.Code 5-11-1 [1967] et seq., it is overruled.

3. In proving a prima facie case of disparate impact under the Human Rights Act, W.Va.Code 5-11-1 [1967] et seq., the plaintiff bears the burden of (1) demonstrating that the employer uses a particular employment practice or policy and (2) establishing that such particular employment practice or policy causes a disparate impact on a class protected by the Human Rights Act. The employer then must prove that the practice is "job related" and "consistent with business necessity." If the employer proves business necessity, the plaintiff may rebut the employer's defense by showing that a less burdensome alternative practice exists which the employer refuses to adopt. Such a showing would be evidence that employer's policy is a "pretext" for discrimination.

4. There is nothing in the Human Rights Act, W.Va.Code 5-11-1 [1967] et seq., that forbids employers from paying workers based upon their market value. In specialized fields, subtle distinctions in technical knowledge may be rewarded by greater compensation.

5. A university does not engage in age discrimination when it pays new faculty, regardless of age, based upon the fair market value generally prevailing for entry level faculty in their respective specific disciplines.

Darrell V. McGraw, Jr., Atty. Gen., Kelli D. Talbott, Asst. Atty. Gen., Charleston, for appellant.

Darrell V. McGraw, Jr., Atty. Gen., Paul R. Sheridan, Sr. Asst. Atty. Gen., Charleston, for appellees.

NEELY, Justice:

The appeal in this age discrimination case concerns disparate impact under the West Virginia Human Rights Act, W.Va.Code 5-11-1 [1967] et seq. West Virginia University (the University) appeals the final order of the West Virginia Human Rights Commission (the Commission) pursuant to W.Va.Code 5-11-11 [1989] which found the University unlawfully discriminated against Robert L. Decker based on age with regard to salary. On appeal, the University alleges that its compensation policy is necessary to compete with other elite educational institutions and to preserve the University's reputation and accreditation.

The Commission viewed the University compensation system, which distinguishes between "new hires" and existing faculty, as having a disparate impact on older faculty members in violation of the West Virginia Human Rights Act, W.Va.Code 5-11-1 [1967] et seq. Upon finding that Dr. Decker proved a prima facie case of disparate impact, the Commission concluded that the University failed to show that the disputed practice is consistent with business necessity.

However, when we review the questions presented, this court disagrees and reverses the Commission. We hold that the University met its burden of proving business necessity, and Dr. Decker failed to present an equally effective alternative practice that would involve less adverse impact upon his protected class.

I.

Robert L. Decker is a tenured professor at West Virginia University. He has a Ph.D. in industrial psychology from Carnegie Mellon University. Dr. Decker, a white male born in 1926, is a member of the protected class of persons under the West Virginia Human Rights Act. ¹ W.Va.Code 5-11-1 [1967] et seq.

In 1955 Dr. Decker became a member of the faculty in the psychology department in the College of Arts and Sciences of West Virginia University. While teaching for the psychology department Dr. Decker was awarded tenure. In 1977, Dr. Decker accepted a position as associate professor in the industrial labor relations department of the University's College of Business and Economics. The College of Business and Economics at West Virginia University consists of six departments: accounting, economics, finance, industrial and labor relations, management, and marketing.

There are only two faculty members in the industrial and labor relations department, Dr. Decker and the Chairman, Randal Elkins. No new faculty have been hired in the industrial and labor relations department since it's formation in 1977. In 1979, Dr. Decker was promoted to full professor in the College of Business and Economics, industrial labor relations department of the University.

II.

Institutions of higher education in West Virginia are dependent upon the legislature for the funding of employee salaries. Salary adjustments for existing faculty depend primarily on the availability of across-the-board salary increases initiated by the legislature or the University's board of trustees. Incumbent faculty members are also given salary increases when they are promoted to administrative positions, or change ranks. However, there is a separate and distinct process by which starting salaries for new faculty members are determined.

Starting salaries are based on the median "market" rate for similarly credentialed "new hires". The University is accredited by the American Assembly of Collegiate Schools of Business [hereinafter "AACSB"]. Each year the AACSB issues a questionnaire for a salary survey to the affiliated schools, and from information supplied in response, prepares a document concerning average salaries. The information from this annual report serves as a guideline for the University regarding salaries for new faculty. The University uses the median salary range for the specific academic discipline to which five percent is added. This figure represents the starting salary offered to new hires.

Due to the University's poverty, compression and inversion of incumbent faculty salaries has resulted. Compression occurs when salaries offered to new hires increase more rapidly than the average salary increase for experienced, existing faculty. Inversion occurs when the salaries offered to new faculty, based on the competitive value in the academic marketplace, are higher than the salaries for existing faculty.

On 25 November 1987, Dr. Decker filed a complaint with the Commission alleging age discrimination with regard to the salary paid to him by the University. Dr. Decker claimed the University denied him an equitable raise in 1987, and that the University routinely hires young inexperienced faculty into the College of Business and Economics at salaries at or above his salary. ² A hearing was held before the hearing examiner for the Commission.

On 21 April 1993, the hearing examiner held that the University's dual compensation policy did adversely affect faculty members over 40 years old already employed by the University, and violated the West Virginia Human Rights Act. However, the examiner found that Dr. Decker had not been personally affected because no new faculty had been hired in Dr. Decker's department since it was created in 1977. Thus, no new comparable faculty had been hired by the University at a higher salary than Dr. Decker's. For this reason, the hearing examiner ruled that Dr. Decker had suffered no compensable injury.

Both the University and Dr. Decker appealed the hearing examiner's decision to the Commission pursuant to W.Va. 77 C.S.R. 2-10 [1990]. The University appealed the finding that the compensation policy was discriminatory. Dr. Decker appealed the finding that he had suffered no injury as a result of the policy.

On 22 October 1993, the Commission entered a Final Order which upheld the finding of discrimination against the University, but reversed the finding that Dr. Decker had suffered no harm. As a result, Dr. Decker was awarded back pay with incidental damages for humiliation, embarrassment and loss of personal dignity, a cease and desist order, and reimbursement of expenses. This appeal followed.

III.

The University's primary assignment of error is that Dr. Decker failed to establish a prima facie case of age discrimination under the West Virginia Human Rights Act, W.Va.Code, 5-11-1 [1967] et seq. Under W.Va.Code, 5-11-9 [1992], it is "an unlawful discriminatory practice, unless based upon a bona fide occupational qualification, ... (1) [f]or any employer to discriminate against an individual with respect to compensation, hire, tenure, terms, conditions, or privileges of employment if the individual is able and competent to perform the services required even if such individual is blind or handicapped...."

"The term 'discriminate' or 'discrimination' means to exclude from, or fail or refuse to extend to, a person equal opportunities because of race, religion, color, national origin, ancestry, age, blindness, handicap, or familial status and includes to separate or segregate[.]" W.Va.Code, 5-11-3(h) [1994] (emphasis supplied). "The term 'age' means the age forty or above[.]" W.Va.Code, 5-11-3(k) [1994].

IV.

The appellee's assertion that Dr. Decker's claim succeeds under a disparate treatment theory is without merit. Disparate treatment is applicable to claims of intentional discrimination, as opposed to claims that a facially neutral practice is having disparate impact upon a protected class. Conaway v. Eastern...