Reverse and Remand on Residency Requirement for Non-Uniform Workers

by Art Gutman Ph.D., Professor, Florida Institute of Technology

The case is Meditz v. City of Newark [2011 U.S. App. LEXIS 19670] decided on 9/28/11. The issue is whether a residency requirement for non-uniform employees adversely impacts white applicants. The 3rd Circuit thinks so. Clearly, “reverse discrimination” cases are always of interest. However, this case is especially interesting in light of NAACP v. North Hudson Regional Fire & Rescue (2010) [707 F. Supp. 2d 520] in which a residency requirement for firefighter candidates that excluded applicants living outside of “member municipalities” was deemed to adversely impact black applicants. The North Hudson case was discussed in an alert on October 12, 2011. Also of relevance is a similar ruling to North Hudson by the 3rd Circuit in 1991 in NAACP v. Town of Harrison [940 F.2d 792].

Recall, there were three rounds in the North Hudson case. In Round 1, District Court Judge Dickson R. Debevoise issued a preliminary injunction giving North Hudson the option of hiring beyond its borders prior to the Supreme Court’s ruling in Ricci v. DeStefano (2009). North Hudson responded with a hiring freeze, fearing they would be in violation of a settlement reached with Hispanic applicants from within its borders in 2009. In Round 2, Judge Debevoise overturned the preliminary injunction in light of Ricci (that fear of losing a challenge by Hispanic applicants was job related). Judge Debevoise then changed his mind Round 3 when faced with statistical evidence that only 2 of 323 employees in the regional fire department were black, and black applicants would be hired in far greater numbers given expansion to neighboring counties.

Enter Gregory Meditz, a white male resident of East Rutherford, New Jersey who applied for the position of Housing Development Analyst in the City of Newark. Meditz, a lawyer, argued his own case and showed statistically that 9.24% of Newark's non-uniformed member workforce is white compared to 14.2% available in the relevant labor market for the job in question. Citing both the Harrison and North Hudson cases, District Court Judge William J. Martini granted summary judgment to the City of Newark [2010 U.S. Dist. LEXIS 37334], ruling:

This is not a situation where less than 1% of Defendant's population or total workforce is White. ….. Newark's employment statistics do not suggest its Ordinance has caused a significantly discriminatory hiring pattern for the positions in question. Moreover, Newark is New Jersey's largest city with over 270,000 residents, 38,950 of whom are White. Given its diversity and large population, there is no need to redefine the relevant labor market past city limits for purposes of Title VII analysis.

In other words, Judge Martini’s ruling reduces to two points: (1) that because of the size of Newark’s population, the city’s limits constituted a relevant labor pool, and (2) that a residency requirement that creates a 9.24% vs. 14.2% disparity is too small to suggest racial discrimination. Both part of Martini’s ruling were reversed in light of the Supreme Court’s landmark ruling in Hazelwood v. US (1977) [433 U.S. 299].

The first point is easy to dispel. It’s like saying that because Brooklyn, New York is so large, applicants from neighboring boroughs of New York City need not apply, even though New York City residents routinely travel across the boroughs to go to work. Thus, the 3rd Circuit ruled employers must consider “geographical location, flow of transportation facilities, locations from which [employers] draw their work force, and commuting patterns” in order to determine a relevant labor pool. For example the Hazelwood School District was in a suburb of St. Louis and the Supreme Court ruled based on transportation facilities and commuting patterns that St. Louis was not part of the relevant labor pool for the school district in the Hazelwood case. In contrast, the 3rd Circuit deemed that the confines of Newark were too narrow to constitute the relevant labor pool given the normal transportation flow.

The second, and I think more important point for present purposes, is that Judge Martini failed to use the Hazelwood standard for assessing the 9.24% vs. 14.2% disparity. Or in the words of the 3rd Circuit:

The Supreme Court has set forth standards to be used as a basis for evaluating statistical evidence in disparate impact claims. Relying on the statistical standards developed in jury analysis cases, the Supreme Court suggested that "fluctuation of more than two or three standard deviations would undercut the hypothesis that decisions were being made randomly with respect to race." Hazelwood, 433 U.S. at 311 n.17. Assuming for the moment that the District Court was correct and the relevant labor market is the population of the city of Newark, the difference between the two percentages is slightly over six standard deviations, far in excess of the Supreme Court's suggested standard of two or three standard deviations.14 This difference appears to establish a prima facie case.

The reference to the “jury analysis cases” is to Castaneda v. Partida (1977) [430 U.S. 482], the ruling that established the deviation rule that was subsequently used (i.e., three months later) in Hazelwood.

The bottom line is even within the confines of Newark, the relevant disparity exceeded the requirements of the deviation rule, meaning Meditz has a valid adverse impact claim and the City of Newark must come up with a job-related reason for its residency requirement.

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