# Petition for Writ of Certiorari — Hill v. Mississippi State Employment Service

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## Record

- **Collection:** Supreme Court brief
- **Document type:** Petition for Writ of Certiorari
- **Published:** January 1, 1991
- **Citation:** 502 U.S. 864

## Text

% l @ k v4 } Supreme Court, is |

FILED
JUL 2 g 499}

No. ai

In The OFFICE GF THE CLERK

Supreme Court of the United States

October Term, 1991
«

HAZEL HILL,

Petitioner,

MISSISSIPPI STATE EMPLOYMENT SERVICE; MISSIS-

SIPPI EMPLOYMENT SECURITY COMMISSION; O.H.

SIMMONS, HUGH GIBSON, WILLIAM G. LEONARD,
AND MARY BRYANT, COMMISSIONERS,

Respondents.

¢

Petition For Writ Of Certiorari To The
United States Court Of Appeals For The
Fifth Circuit

*
PETITION FOR WRIT OF CERTIORARI
e —
DonaALD B. VERRILLI, JR.*

JENNER & BLOcK

21 Dupont Circle, N.W.
Washington, D.C. 20036
(202) 223-4400

Sam H. BUCHANAN, Jr.
JOHN C. JoPLING
SOUTHEAST MississiPPi
LEGAL SERVICES
111 East Front Street
P.O. Drawer 1728
Hattiesburg, Mississippi 39403
(601) 545-2950

Counsel for Petitioner

*Counsel of Record
July 29, 1991

COCKLE LAW BRIEF PRINTING CO., (800) 225-6964
OR CALL COLLECT (402) 342-2831

QUESTIONS PRESENTED

1. Whether, in a case arising under Title VII of the Civil
Rights Act of 1964, a defendant’s assertion of pervasive
incompetence constitutes a legitimate nondiscriminatory
reason sufficient to rebut the mandatory inference of
discrimination arising from a plaintiff’s prima facie case
of disparate treatment?

2. Whether, in conflict with this Court’s ruling in
Bazemore v. Friday as well as the Second, Ninth and Dis-
trict of Columbia Circuits, the Fifth Circuit erroneously
held that a Title VII defendant can rebut a statistically
significant showing of racial disparity by merely alleging,
without any supporting evidence, that the plaintiff’s sta-
tistics failed to account for potentially relevant factors
that might explain the disparity?

ii

TABLE OF CONTENTS

Page

QUESTIONS PRESENTED POET TEE Tee Co ee i
og Ee errr errr rrr rer rrr | 1
FETTER os 6.5 cent onsheedeureeseneneeaee 1
STATUTORY PROVISIONS INVOLVED............. 1
STATEMENT OF THE CASE..............5--s0000- 2
A. FOCRRl BCS 6 ks oss 5 eke eecesuese ares 2
B. District Court Proceedings................... 6
C. The Court of Appeals Proceeding............ 10
REASONS FOR GRANTING- THE WRIT ........... 12

I. THIS COURT SHOULD GRANT CERTIORARI
TO DECIDE WHETHER AN EMPLOYER'S
ASSERTION OF PERVASIVE INCOMPETENCE
CAN CONSTITUTE A LEGITIMATE BUSINESS
JUSTIFICATION SUFFICIENT TO REBUT THE
LEGALLY MANDATORY INFERENCE OF DIS-
CRIMINATION ARISING FROM A PLAINTIFF’S
PRIMA FACIE CASE OF DISPARATE TREAT-
|. | rrr rr me Sn Sor he 12

Il. THIS COURT SHOULD GRANT CERTIORARI TO
CLARIFY ITS HOLDING IN BAZEMORE V. FRI-
DAY AND TO RESOLVE THE CONFLICT IN THE
CIRCUITS RESPECTING WHAT A TITLE VII
DEFENDANT MUST SHOW TO REBUT A STATIS-
TICALLY SIGNIFICANT SHOWING OF RACIAL
LMOMNE Tt ican iedacdespaene a el 21

CE IIVRAFIENS on vee ide ene ne ow nielpee Sere en 24

TABLE OF AUTHORITIES

Page
Cases
Albemarle Paper Co. v. Moody, 422 U.S. 405
ee 2A bddn ge oy 5 aly eds ev nreeeeees 16, 17
Bazemore v. Friday, 478 U.S. 385 (1986) ........ 9, 21, 22
Castenada v. Partida, 430 U.S. 482 (1977).............. 9
Catlett v. Missouri Highway and Transp. Comm'n,
828 F.2d 1260 (8th Cir. 1987), cert. denied, 108 S.
eae as by skh soc cnaveeewercce: 23
DeMedina v. Reinhardt, 686 F.2d 997 (D.C. Cir.
ES ar rn 22
Dothard v. Rawlinson, 433 U.S. 321 (1977)............ 14
Easley v. Anheuser-Busch, Inc., 572 F. Supp. 402
(E.D. Mo. 1983), aff'd in relevant part, 758 F.2d
re 18, 20
E.E.0.C. v. General Telephone Co. of Northwest, Inc.,
OE es S| 22, 3
E.E.O.C. v. Sears, Roebuck & Co., 839 F.2d 302 (7th
Tn ne 23
Furnco Construction Corp. v. Waters, 438 U.S. 567
EO IS ee 13
Griggs v. Duke Power Co., 401 U.S. 423 (1971)........ 16
Hazelwood School District v. United States, 433 U.S.
Eee pelea shes ssc ches ns eerr eves 20

Impact v. Firestone, 893 F.2d 1189 (11th Cir. 1990).... 20

Jones v. International Paper Co., 720 F.2d 496 (8th
ee eee Gk seeds ones cee saved ss 14

Lanphear v. Prokop, 703 F.2d 1311 (D.C. Cir. 1983).... 19

iv

TABLE OF AUTHORITIES - Continued

Page
McDonnell Douglas Corp. v. Green, 411 U.S. 792
Ss ooh wal Ae a ae eee a ean acon es passim
Nanty v. Barrows, 660 F.2d 1327 (9th Cir. 1981)...... 20
Palmer v. Schultz, 815 F.2d 84 (D.C.Cir. 1987)...... 9, 22
Parsons v. County of Del Norte, 728 F.2d 1234 (9th
Oe Perr eee Tre re rere rere Cree ere 14
Paxton v. Union National Bank, 688 F.2d 552 (8th
Oe | eer rer rer. Pry te rer rr errr 20
Pegues v. Mississippi State Employment Service, 699
Foe Fae es cea kako a ieanear her eesxs oe
Pouncy v. Prudential Ins. Co. of America, 668 F.2d
Fe a ees en enens hea reer eas 14
Price Waterhouse v. Hopkins, 109 S. Ct. 1775
5 SR renee ry ere eee: 12, 14, 15, 16, 17, 19
Segar v. Smith, 738 F.2d 1249 (D.C. Cir. 1984)........ 22

Sobel v. Yeshiva Univ., 839 F.2d 18 (2d Cir. 1988)..... 23

Texas Department of Community Affairs v. Burdine,

eS | eee ee er passim
Wards Cove Packing Co., Inc. v. Atonio, 109 S. Ct.
er ee rr rer een errs 16

OTHER AUTHORITIES

Se Mey SPE cos ewe dc es eee MWee nen Ree eens 6
ee Se es v4 os Re ewhe ka ease csi ab arseeeee ss 1
Title VII of the Civil Rights Act of 1964, 42 U.S.C.
Ferrer C ery Cre rrr ee Perr errr passim
Wagner-Peyser Act, 29 U.S.C. § 49.................8. 3

TABLE OF AUTHORITIES —- Continued
Page

MISCELLANEOUS

B. Schlei & P. Grossman, Employment Discrimina-
Siem GOee WSIS COR OU. TIGR). ove ok ck cewensieess 14, 20

Beard, Title VII and Rule 301: An Analysis of the
Wards Cove and Atonio Decisions, 23 Akron L. Rev.
ME Wak oa Nebel taUs a4 the Fo ERR ay oa 13

D. Baldus & J. Cole, Statistical Proof of Discrimina-
me i | | errr Serer rr err rrr er er 9

OPINIONS BELOW

The December 13, 1990 opinion of the United States
Court of Appeals for the Fifth Circuit is reported at 918
F.2d 1233 (5th Cir. 1990) and is reprinted in the Appendix
to this Petition (“App.”) at la. The May 1, 1989 memoran-
dum opinion of the district court (per Magistrate Britt R.
Singletary) is unreported and is reprinted in the Appen-
dix to this Petition at 29a.

JURISDICTION

The Fifth Circuit entered an order denying rehearing
on April 15, 1991. App. 65a. On July 8, 1991, Justice
O’Connor extended the time for filing the Petition for
Certiorari in this case to July 29, 1991. Jurisdiction is
conferred on this Court by 28 U.S.C. § 1254.

t

STATUTORY PROVISIONS INVOLVED

Title VII of the Civil Rights Act of 1964, 42 U.5.C.
§ 2000e-2, which provides in relevant part:

(a) It shall be an unlawful employment prac-
tice for an employer -

(1) to fail or refuse to hire or discharge any
individual, or otherwise to discriminate
against any individual with respect to his
compensation, terms, conditions, or privi-
leges of employment, because of such indi-
vidual’s race, color, religion, sex, or national
origin; or

(2) to limit, segregate, or classify his
employees or applicants for employment in
any way which would deprive or tend to
deprive any individual of employment
opportunities or otherwise adversely affect
his status as an employee, because of such
individual’s race, color, religion, sex or
national origin.

(b) It shall be an unlawful employment prac-
tice for an employment agency to fail or refuse
to refer for employment, or otherwise to dis-
criminate against, any individual because of his
race, color, religion, sex or national origin, or to
classify or refer for employment any individual
on the basis of his race, color, religion, sex or
national origin.

STATEMENT OF THE CASE

Petitioner Hazel Hill is a black woman seeking
redress under Title VII of the Civil Rights Act of 1964, 42
U.S.C. § 2000e et seqg., for racial discrimination by the
Mississippi State Employment Service (MSES). Although
this case arises in the context of discriminatory employ-
ment referrals, it raises important questions about the
order and nature of proof in virtually all cases brought
under Title VII and other anti-discrimination statutes.

A. Factual Background

In the hope of bettering her life by obtaining a job as
a cashier, waitress, or cocktail waitress, Petitioner Hill
registered in April 1982 with the local office of the MSES.
MSES is a state-run “labor exchange” that matches quali-
fied applicants with available jobs. On an initial visit, Hill

completed an application indicating her work experience
and occupational preferences. This inforfation was sub-
sequently recorded on MSES Form 511, which translated
the jobs for which Hill was considered qualified into
9-digit Dictionary of Occupational Titles (DOT) codes.
When an applicant such as Hill requests a referral, MSES
searches the job orders within the applicant’s code. When
an employer places a job order seeking referrals, MSES
searches the relevant codes for qualified candidates.? Hill
v. Mississippi State Employment Service, 918 F.2d 1233,
1234-35 (Sth Cir. 1990); App. 3a.

Not infrequently an employer requests several candi-
dates to interview for a single opening. Often, there are
more than enough qualified candidates for a given job
vacancy, leaving MSES workers broad discretion to select
which applicants to refer. MSES would, however, often
“short” the order by sending fewer than the requested
number of applicants. Additionally, MSES would often
refer candidates “out of code” — those whose qualifica-
tions or preferences did not match the job order. 918 F.2d
at 1235; App. 4a.

' Hill was classified for cashier, 211-492-014, and waitress,
311-477-030, positions.

* These procedures were set out in the Employment Service
Manual (ESMI]I), a publication of the U.S. Department of Labor.
MSES is a division of the Mississippi Employment Security
Commission, which itself is a member of a network of state
employment services created by the Wagner-Peyser Act, 29
U.S.C. § 49. Under the Act, in order to receive federal funds,
member agencies must comply with the policies established by
the United States Employment Service.

During the period from April 1, 1982 to April 14,
1983, when Hill sought referrals, MSES referred scores of
white job seekers to numerous positions for which Hill
qualified. From January 12 until March 18, 1983, for
example, a job order was placed by a department store
for cashiers — a position for which Hill was qualified and
for which she had consistently expressed a preference.
Hill visited the MSES offices to request referrals no fewer
than 3] times during the period the order was open. 918
F.2d at 1235 n.5; App. 6a. The job opportunity was well
known in the MSES office, and MSES interviewers with
whom Hill met during the period were aware of the
opening. See Trial Transcript at 635-36. Neither Hill nor
any other of the 163 black candidates coded as cashiers
were referred. Instead, 22 whites were referred for the
job, 10 of them out of code. Several of the white candi-
dates did not satisfy — as Hill undeniably did - the
employer’s education and experience requirements.*

In another instance, Hill was sent to a Ramada Inn
for a chambermaid position, only to learn upon arriving
that the Inn had also placed with the MSES a job order for
a waitress, for which Hill was not referred. In yet another
instance, on March 10, 1983, a day on which Hill sought
and was denied other waitress referrals, Shirley Garris, a
white woman employed by Hill’s trial counsel,4 sought

> According to the Magistrate, 3 of these referred white
candidates lacked even the minimal experience required and 5
lacked the educational minima. App. 36a.

4 Two days earlier Hill had filed a complaint with the
E.E.O.C. alleging the racially discriminatory referrals.

and received from the same MSES office two waitress
referrals, one of which had been open for 25 days and the
other for more than a week. Neither job order requested
special skills or experience of any kind.° 918 F.2d at
1235-36 & n.5; App. 6a-7a; see also App. 36a-40a (district
court findings of fact)

On a number of occasions, job orders were “shorted,”
while Hill and other qualified black applicants were
ignored. For example, a December 1982 order for bank
tellers requested six referrals. Five white women were
referred, all out of code and all lacking the requisite
experience. Hill, experienced as a bookkeeper and coded
for the position, was not referred.® Similar results fol-
lowed a February 1983 job order for a cashier in a local
convenience store. Despite the employer’s request for ten
referrals, MSES sent only five candidates, four of them
white. Hill, who was qualified, was not referred. When a
position opened for an emergency room technician, Hill’s
experience working in a hospital and the employer’s
request for five referrals were disregarded. MSES sent a
single white woman - again out of code. App. 36a-40a.

> In another instance, occurring after April 14, 1983, Hill
specifically requested a referral from the MSES as a cashier at
the County Market grocery. She was told no openings existed,
but visited the store on her own initiative. There she was
informed that an opening did exist, but that she would need an
MSES referral. While Hill was still inside the store, a white
applicant appeared with an MSES referral and was hired on
the spot.

6 The MSES interviewer who referred Hill to positions as a
chambermaid and counter attendant conceded that she knew
of the teller position and had referred other candidates

The few referrals Hill received from MSES were for jobs
stereotypical for black women in the Deep South —- making
beds and serving fried chicken. She received two referrals as
a hotel chambermaid, as well as referrals as a “counter
attendant” in a fried chicken restaurant, and as a “cashier” at
Kentucky Fried Chicken. The latter was her only “cashier”
referral (it was already filled when she arrived for her
interview); she received no waitress referrals.

B. District Court Proceedings.

After exhausting administrative remedies, Hill filed suit
in the United States District Court for the Southern District
of Mississippi on September 2, 1983. She alleged disparate
treatment and disparate impact violations of Title VII, 42
U.S.C. § 2000e et seq. The district court had jurisdiction
pursuant to 42 U.S.C. § 2000e-5. By consent of the parties and
pursuant to 28 U.S.C. § 636(c), the case was tried before a
magistrate with direct appeal to the Court of Appeals.

In addition to evidence of the specific instances of
disparate treatment described above, Hill introduced sub-
stantial statistical and quantitative evidence. During the
period when Hill sought referrals, MSES processed 191

————job orders within Hill’s preferred occupational codes: 6
for cocktail waitress, 39 for waitress, and 146 for cashiers.
Each of the 21 candidates referred to cocktail waitress
jobs for which Hill was qualified was white, as were 71%
of the waitress referees, and 68.8% of the cashier referees.
During this time, the pool of applicants was, on average,
58.2% white. Using all information availabie from MSES
records, Hill’s statistical expert demonstrated through
multivariate regression analysis that the referral patterns
for the jobs which Hill was seeking would have been

extremely unlikely to have occurred in the absence of
racial discrimination.’ Hill’s expert in personnel manage-
ment further demonstrated that MSES processed 87 job
orders within Hill’s preferred codes to which no black
applicants were referred and that 25 of these job orders
contained referrals of white candidates whose qualifica-
tions were manifestly inferior to those of Hill. Memoran-
dum Opinion, App. 29a, 40a-45a (summarizing evidence).

Based on particular incidents of discrimination docu-
mented by Hill — but not on Hill's statistical showing -
the presiding magistrate found that Hill had established a
prima facie case of disparate treatment as defined by
McDonnell Douglas Corp. v. Green, 411 U.S. 792 (1973), and
Texas Department of Community Affairs v. Burdine, 450 U.S.
248 (1981), and as adapted to employment agency refer-
rals by the Fifth Circuit in Pegues v. Mississippi State
Employment Service, 699 F.2d 760 (5th Cir. 1983), cert.
denied, 464 U.S. 991 (1984). See App. 54a-55a.

MSES conceded that the particular instances of dispa-
rate treatment documented by Hill had occurred. MSES

? Dr. Jerry Himmelstein, Hill’s expert, found standard
deviations of 4.83, 8.78, and 3.41 for cocktail waitress, waitress,
and cashier, respectively. Statistical tables indicate that the
probability of a disparity measuring 8.78 standard deviations
from the racially neutral norm being attributable to random
chance is less than one in one billion.

8 In Pegues, the Court held that a prima facie case is made
out in an individual disparate treatment case when a plaintiff
proves, by a preponderance of the evidence, that the plaintiff
(1) is a member of a protected group (2) has applied for and
been coded for occupations for which the office is making
teferrals (3) has failed to secure a referral and (4) a non-
member of the protected group is referred.

argued, however, that these instances were somehow
attributable to the “inherent” or “general inefficiency” of
MSES’s “system.” In essence, MSES pled incompetence.
Calling the question “clouded” by the fact that “MSES
d{id] not point to a particular reason justifying a dis-
parity,” the magistrate noted that MSES had claimed it
was hampered by “(1) employee error or oversight,
(2) inefficient communication among staff members about
active job orders, (3) inability to contact applicants,
(4) applicant’s preferences, and (5) other racially neutral
problems.” Id. MSES made no effort to demonstrate that
those “inherent defects” contributed to the particular
instances of disparate treatment detailed by Hill.? App.
55a. Based on this showing, the magistrate concluded that
MSES had met its rebuttal burden of articulating a “legiti-
mate nondiscriminatory reason” for the disparate treat-
ment of Hill. App. 55a-56a. See Burdine, 450 U.S. at 253-54.

The magistrate then found that Hill had not carried
her burden of proving that MSES’s explanation was pre-
textual. To evaluate Hill’s “pretext case,” the magistrate
looked only to the statistical evidence. That evidence was
found to be “flawed and insufficient to prove pretext,” on
the ground that it omitted two factors that the court
deemed to be of critical importance to referral decisions -
applicants’ experience and education.'° App. 57a-58a.

? The record forecloses such a showing in any event. Hl
was in frequent contact with the office, and the MSES
employees with whom she dealt had specific knowledge of
jobs for which she was qualified, but not referred.

10 The defendants could not plausibly claim, as the courts
oelow erroneously seem to have concluded, that work

(Continued on following page)

5 ne

In reaching this result, the magistrate took no note of

MSES’s explicit concession that Hill’s analysis would

have shown statistically significant levels of discrimina- _—
tion even if the omitted variables were included —- the
omissions affected only the magnitude of the disparity."!

Nor did the magistrate evaluate the entirety of Hill’s
evidence in determining whether pretext was shown.

The magistrate also ruled that Hill’s disparate impact
challenge to the MSES referral system had to be rejected
(Continued from previous page)
experience was omitted from Hill’s statistical analysis. See
Pegues v. Mississippi State Employment Service, 699 F.2d at 764
(“Experience was a primary consideration in the [MSES] cod-

ing procedures”).

'! MSES readily conceded that plaintiff's expert’s analysis
was the best possible given the available data ~ all of which
was in MSES’ control. Apparently the magistrate did not grasp
the meaning of statistical significance. If a regression analysis
is found to be statistically significant, that finding necessarily
implies that the odds that the observed discrimination was
produced by random or chance factors are so low that the
possibility can be discounted. See Castenada v. Partida, 430 U.S.
482, 496-97 n.17 (1977); Pegues, 699 F.2d at 768 n.9.

MSES made no attempt to introduce any regression data of
its own, nor did it attempt to introduce any evidence whatever
to support its implicit claim that the white workers being
referred to cocktail waitress and cashier jobs were in fact more
highly educated or experienced. Circuit Courts and leading
commentators have interpreted this Court’s decision in
Bazemore v. Friday, 478 U.S. 385 (1986), as holding this sort of
“mere conjecture or assertion” in the face of statistical evidence
is legally insufficient to undermine an inference of discrimina-
tion. Palmer v. Schultz, 815 F.2d 84, 101, 106 (D.C. Cir. 1987). See
also D. Baldus & J. Cole, Statistical Proof of Discrimination vii
(1986 Supp.).

10

because of the purported flaws in Hill’s statistical anal-
ysis. App. 58a.

C. The Court of Appeals Proceeding

The Fifth Circuit affirmed the district court’s ruling,
with Judge Rubin dissenting. The majority held that an
employer’s assertion of pervasive incompetence could
serve as a “legitimate nondiscriminatory explanation”
sufficient to rebut a prima facie case of disparate treat-
ment. The panel majority was “trouble[d]” by the “likely”
prospect that “general inefficiency” would become a
“shield for almost any employer —- including a discrimi-
nating one,” and by the quality of the “evidentiary sup-
port” for “MSES’s systemic problems.” 918 F.2d at 1239;
App. 14a. The majority nonetheless concluded that
“MSES does not offer . . . an utter lack of specifics” and
that it would be “the height of unfairness to infer
... discriminatory animus” from “an employer’s detailed
and documented inefficiency.” 918 F.2d at 1239; App.
15a.12

12 In dissent, Judge Rubin took the majority to task for
“not even attempting to define what is meant by a ‘legitimate
nondiscriminatory reason,’ ” insisting that those words must
take their meaning from the purposes of the Fair Employment
Practices Act. Noting that this Court has consistently embraced
the premise that “efficient workmanship” and “neutral
employment and personnel decisions” go hand in hand, Judge
Rubin maintained that a “legitimate reason” must be more
than “non-criminal”; that it must be “justifiable.” MSES claims
of “neutral inefficiency were belied by the “evidence [showing]
that MSES system is inefficient only when it fails to refer black
employees.” App. 20a-25a.

So

li

The Court of Appeals went onto hold that Hill’s
Statistics failed to demonstrate that MSES’s “incompe-
tence” defense was pretextual. The court acknowledged
that, as MSES conceded, Hill’s statistical analysis was the
“best possible” given the available data. 918 F.2d at 1237
n.9; App. 9a. The court also acknowledged MSES’s con-
cession that Hill’s regression analyses would show statis-
tically significant levels of race-based disparity even if
the omitted variables were included in the analysis. Id. at
1237; App. 10a-1la. The court nonetheless concluded that
the omission of the variables destroyed the probative
worth of the analyses. Id. at 1240; App. 17a-18a. The
unspoken premise of the court’s ruling was that the omit-
ted qualifications were less likely to be present in black
than in white applicants - an assumption without any
support in the record.

The appellate court also summarily rejected Hill’s
disparate impact allegations. Because Hill's statistical evi-
dence did not demonstrate pretext, the court concluded,
that evidence could not support a disparate impact case.
918 F.2d at 1240; App. 18a.

Judge-Rubin dissented. He would have held that
pervasive incompetence cannot be considered a legiti-
mate nondiscriminatory explanation under McDonnell
Douglas and Burdine. Judge Rubin also rejected the
“incompetence” defense as applied because MSES had
“not shown a single instance. . . in which the failure to
refer employees to jobs resulted from difficulty in reach-
ing Hill — or from overwork - or red tape.” 918 F.2d at
1243; App. 25a. Pointing out that “inefficiency is racially
neutral [and] cannot in itself account for racial discrimi-
nation,” he also would have held that Hill’s statistically

12

significant showing of discrimination proved pretext. Id.
at 1241; App. 20a.

REASONS FOR GRANTING THE WRIT

I. THIS COURT SHOULD GRANT CERTIORARI TO
DECIDE WHETHER AN EMPLOYER’S ASSERTION
OF PERVASIVE INCOMPETENCE CAN CONSTI-
TUTE A LEGITIMATE BUSINESS JUSTIFICATION
SUFFICIENT TO REBUT THE LEGALLY MANDA-
TORY INFERENCE OF DISCRIMINATION ARIS-
ING FROM A PLAINTIFF’S PRIMA FACIE CASE
OF DISPARATE TREATMENT.

This case presents-an important question of Title VII
law that has not been, but should be, decided by this
Court: whether a defendant’s assertion of pervasive
incompetence constitutes a legitimate nondiscriminatory
business justification sufficient to defeat the legally man-
datory inference of discrimination arising from a plain-
tiff’s prima facie showing of disparate treatment.

In McDonnell Douglas Corp. v. Green, 411 U.S. 792
(1973), and Texas Department of Community Affairs v. Bur-
dine, 450 U.S. 248 (1981), this Court established a “careful
framework” for adjudicating claims of disparate treat-
ment under Title VII. See Price Waterhouse v. Hopkins, 109
S. Ct. 1775, 1796 (1989) (O’Connor, J., concurring in the
judgment). A plaintiff establishes a prima facie case by
showing that: (i) she is a member of a group protected by
Title VII; (ii) she is qualified for the position she seeks;
(iii) she has failed to secure the position; and (iv) the
position was given to someone not a member of a pro-
tected group. This showing creates a “legally mandatory

ee

13

inference of discrimination” unless rebutted by the defen-
dant. Burdine, 450 U.S. at 255 n.10. To rebut a prima facie
case, the defendant must “articulate some legitimate non-
discriminatory reason” for the apparent discrimination.
McDonnell Douglas, 411 U.S. at 802. The plaintiff then has
the opportunity to demonstrate that the defendant’s prof-
fered reasons were “pretextual.” Id.

Since McDonnell Douglas, this Court has been stead-
fast in defining “legitimate nondiscriminatory reasons”
as “rational and neutral business justification[s].” 411 U.S.
at 806 n.21 (emphasis added). Noting that “efficient
workmanship” through fair employment practices is an
important goal of Title VII, the McDonnell Douglas Court
required the defendant to articulate a reason “which could
fairly be recognized as a reasonable basis for its refusal to
hire.” 411 U.S. at 802-03 (emphasis added).'* Thus, even
as the Court held in McDonnell Douglas that the
employer’s proffered reason — the plaintiff’s participation
in illegal and disruptive activities directed at the
employer’s business — was legally sufficient, it was
unwilling to declare that a plaintiff's criminal record
would always constitute a “rational and neutral business
justification” sufficient to count as a “legitimate reason”
for disparate treatment. /d. at 806 n.21 (emphasis added).

Similarly, a unanimous Court in Furnco Construction
Corp. v. Waters, 438 U.S. 567 (1978), while holding that an
employer has no duty under Title VII to maximize the
number of minority applicants, reiterated that the firm’s

13 See also Beard, Title VII and Rule 301: An Analysis of the
Wards Cove and Atonio Decisions, 23 Akron. L. Rev. 105 (1989).

14

asserted hiring practices must “be reasonably related to the
achievement of some legitimate goal.” 438 U.S. at 578
(emphasis added). In Dothard v. Rawlinson, then-Justice
Rehnquist explained that McDonnell Douglas imposes a
“burden to articulate job-related reasons” to rebut a prima
facie case. 433 U.S. 321, 331 (1977) (Rehnquist, J., concur-
ring). Cf. also Price Waterhouse v. Hopkins, 109 S. Ct. at 1804
(O’Connor, J., concurring in the judgment) (to rebut
showing of discrimination, defendant must demonstrate
“sufficient business reasons” (emphasis added)).

Prior to this case, the courts of appeals had likewise
uniformly understood that legitimate nondiscriminatory
reasons in the disparate treatment context should be job-
related reasons. See, e.g., Pouncy v. Prudential Ins. Co. of
America, 668 F.2d 795, 799 (5th Cir. 1982); Jones v. Interna-
tional Paper Co., 720 F.2d 496 (8th Cir. 1983); Parsons v.
County of Del Norte, 728 F.2d 1234 (9th Cir.), cert. denied,
469 U.S. 846 (1984); see generally B. Schlei & P. Grossman,
Employment Discrimination Law 1312 (2d ed. 1983); id. at
480-81 (5-year Cumulative Supp. 1989).

The Fifth Circuit’s ruling in the present case deviates
sharply from this well-established principle. For the first
time, a Circuit has held that a Title VII defendant can
rebut the legally mandatory inference of discrimination
arising froma prima facie case by advancing a reason for
a disparate treatment wholly unrelated to the defendant’s
business interests or needs. Plenary review of this deci-
sion is urgently needed for several reasons.

First, the novel “incompetence” defense recognized
by the Fifth Circuit will re-order outcomes in Title VII

15

cases in a manner flatly inconsistent with the intent of
Congress. As even the “troubled” majority of the divided
Fifth Circuit panel acknowledged, the “incompetence”
defense can look forward to a flourishing career as
“shield for almost any employer — including a discrimi-
nating one.” 918 F.2d at 1239; App. 14a. In effect, the
Court of Appeals has imposed an unattainable standard
for proving discriminatory intent. Discriminating
employers can, at the negligible cost of “articulating”
pervasive incompetence, impose burdens on discrimina-
tion’s victims so prohibitive as to preclude victory for
even plaintiffs who most merit recovery. '4

The Fifth Circuit’s recognition of an “incompetence”
defense also flies in the face of the bedrock congressional
judgment that Title VII should eradicate all “artificial,
arbitrary and unnecessary barriers to employment.”
McDonnell Douglas, 411 U.S. at 806 (quotations omitted).
As this Court has repeatedly reaffirmed, “Congress
addressed the thrust of the Act to the consequences of

'4 Hill, an individual plaintiff with no resources and repre-
sented by a legal services organization, was told — after pre-
senting testimony by three expert witnesses and using all the
data the defendant could provide - that MSES’ attestations of
racially neutral inefficiency could be rebutted by “properly
analyzed and compiled statistics.” 918 F.2d at 1239 n.11; App.
14a.

16

employment practices, not simply the motivation.” Griggs
v. Duke Power Co., 401 U.S. 424, 432 (1971).'5

The Fifth Circuit’s “incompetence” defense immu-
nizes precisely the kind of “artificial, arbitrary, and
unnecessary” bariier that Congress enacted Title VII to
eradicate.'© An obvious tension exists between the legal
rule established by the Fifth Circuit in this case and the
general principles governing disparate impact cases
under Title VII. Ata minimum, this tension demonstrates
the need for clarification as to the legitimacy of the
“incompetence” defense in disparate treatment cases, and

'S In the disparate impact context, this Court has recently
made clear that

[t]he touchstone of this inquiry is a reasoned review
of the employer’s justification. ... A mere insubstan-
tial justification in this regard will not suffice,
because such a low standard of review would permit
discrimination to be practiced through the use of
spurious, seemingly neutral employment practices.

Wards Cove Packing Co., Inc. v. Atonio, 109 S. Ct. 2115, 2126
(1989). Were an employer to raise “incompetence” as a defense
to a prima facie case of disparate impact, Wards Cove would
plainly dictate a judgment for the plaintiff as a matter of law.
That a defendant in a disparate treatment action can, at least in
the Fifth Circuit, avoid liability by an identical defense is
incongruous.

'6 Recognition of the incompetence defense removes the
“ “spur or catalyst which causes employers and unions to self-
examine and self-evaluate their employment practices,’ ” and

thereby undermines the basic deterrent purposes of Title VII.
See Price Waterhouse v. Hopkins, 109 S. Ct. at 1798 (O’Connor, J.
concurring) (quoting Albemarle Paper Co. v. Moody, 422 U.S. 405,
417-18 (1975)).

17

the proper relation between the disparate treatment and
disparate impact analytical frameworks generally.!7

Second, permitting an “incompetence” defense jeop-
ardizes the orderly, efficient adjudication of Title VII
cases. See generally Price Waterhouse v. Hopkins, 109 S. Ct.
at 1798 (O’Connor, J. concurring). As Justice O’Connor
has explained, “the entire purpose of the McDonnell
Douglas prima facie case is to compensate for the fact that
direct evidence of intentional discrimination is hard to
come by.” Price Waterhouse v. Hopkins, 109 S. Ct. at 1801
(O’Connor, J., concurring in the judgment) (emphasis
added). Because direct evidence is typically not available
to Title VII plaintiffs, an individual plaintiff is entitled to
a “legally mandatory inference of discrimination” upon
proving that the most obvious nondiscriminatory

17 In setting forth the basic definition of the defendant's
rebuttal case in the disparate impact context, the Court specifi-
cally incorporated the McDonnell Douglas definition of the
employer’s burden in the disparate treatment context. See
Albermarle Paper Co. v. Moody, 422 U.S. at 425 (quoting McDon
nell Douglas, 411 U.S. at 801).

Some lower courts have held that a defendant's proffered
explanation for disparate treatment is insufficient as a matter
of law if that explanation would fail as a defense to a disparate
impact action. For example, in Easley v. Anheuser-Busch, Inc.,
572 F. Supp. 402, 414 (E.D. Mo. 1983), aff'd in relevant part, 758
F.2d 251 (8th Cir. 1985), the court rejected the defendant's
proffered disparate treatment rebuttal argument that the plain-
tiff was not hired because she failed an employment test. The
court held that the proffered explanation was insufficient as a
matter of law because the test would not have survived scru-
tiny under disparate impact analysis.

18

explanations do not account for the disparate treatment at
issue. See Burdine, 450 U.S. at 255 n.10.

The Fifth Circuit’s incompetence defense vitiates the
crucial policy judgment underlying the McDonnell Dou-
glas/Burdine analytical framework. It allows the defendant
to rebut a prima facie case by mere articulation of the
argument that the plaintiff was the unintended victim of
an arbitrary or artificial barrier. This defense effectively
annihilates the presumption. Every defendant will be able
to argue that disparate treatment of a plaintiff was simply
a mistake. If that “explanation” defeats the inference of
discrimination arising from a prima facie case, plaintiffs
will effectively bear all the risk of erroneous litigation
outcomes caused by plaintiffs’ general inability to obtain
direct evidence of discrimination.

The ruling below also threatens to revolutionize the
second stage of the McDonnell Douglas/Burdine order of
proof, in which the defendant must articulate a legitimate
nondiscriminatory explanation in order to “sharpen{] the
inquiry” into the real reason for disparate treatment of
the plaintiff and to afford the plaintiff “a full and fair
opportunity to show pretext.” Burdine, 450 U.S. at 255.
Instead of focusing the inquiry narrowly on whether
disparate treatment resulted from the particular qualifica-
tions of the individual employee or the particular needs
of the employer, the incompetence defense forces the
individual employee at the pretext stage to undertake
what amounts to a full-blown statistical disparate impact
analysis of the employer’s practices to show that the
alleged “incompetence” - which should disadvantage
whites and blacks equally — is in fact producing racially
discriminatory results. Because, as the majority below

19

acknowledged, the incompetence defense is readily avail-
able to all employers, its recognition threatens to turn
most straightforward individual disparate treatment
cases into the functional equivalent of broad class-action
challenges to systemwide employment practices.

Without direct evidence of discrimination, moreover,
even such a showing may not suffice because the plaintiff
will be hard put to prove that overall incompetence did
not cause the particular adverse employment decision at
issue. At a minimum, the extensive additional burdens
imposed on individual plaintiffs may weil preclude the
vindication of meritorious claims as a result of the diffi-
culty and expense of proving pretext. See Lanphear v
Prokop, 703 F.2d 1311, 1316 (D.C. Cir. 1983) (purpose of
Title VII proof sequence “is defeated if the defendant is
allowed to present a moving target or conceal the
target altogether”); see generally Price Waterhouse v. Hop
kins, 109 S. Ct. at 1801 (O’Connor, J., concurring in the
judgment)

Third, the Fifth Circuit’s endorsement of a general

,

“incompetence” defense conflicts in principle with the
uniform law of other Circuits requiring a specific link
between the plaintiff’s allegations of discriminatory acts
and the defendant’s legitimate nondiscriminatory expla
nation. Burdine has been consistently interpreted to
require that a defendant’s explanation specifically
address the particular instances of alleged discrimination
raised by the plaintiff. Thus, when a qualified applicant is
rejected or a competent employee is dismissed from a job,
a Title VII defendant does not meet its responsibility .o
“explain” its decision by showing that “the odds were
against” a candidate’s being chosen or by “articulating”

20

the economic reasons why a reduction in force was neces-
sary. See Easley v. Anheuser-Bush, 758 F.2d 251, 259-61 (8th
Cir. 1985) (that many applicants applied for job is not a
legitimate nondiscriminatory reason for individual! plain-
tiff’s rejection); Impact v. Firestone, 893 F.2d 1189 (11th
Cir.) (holding that defendant's burden is satisfied oniy by
accounting for each act of disparate treatment), cert.
denied, 111 S. Ct. 133 (1990); Paxton v. Union National Bank,
688 F.2d 552, 566 (8th Cir. 1982) (holding that defendant
must offer specific reasons for each failure to promote
individual black employees, and finding that defendant
had, by introducing employment records, articulated a
reason for every employee's discharge), cert. denied, 460
U.S. 1083 (1983); Cf. Nanty v. Barrows, 660 F.2d 1327 (9th
Cir. 1981) (holding that defendant fails to satisfy its bur-
den unless it articulates a reason which might explain the
plaintiff’s actual rejection). See generally B. Schlei & P.
Grossman, supra, at 1312.

As these decisions recognize, once an individual
plaintiff has made a prima facie showing of disparate
treatment, that the defendant is generally or “officially”
fair-minded, let alone pervasively incompetent, is almost
entirely beside the point. See generally Hazelwood School
District v. United States, 433 U.S. 299 (1977) (holding that
evidence of official policy of nondiscrimination was
insufficient to carry defendant’s production burden). The
Fifth Circuit’s ruling in the present case is squarely at
odds with the animating principles, if not the holdings, of
these decisions.

For these three reasons, this Court should review the
Fifth Circuit’s recognition of the “incomptence” defense.

21

—

Il. THIS COURT SHOULD GRANT CERTIORARI TO
CLARIFY ITS HOLDING IN BAZEMORE V. FRI-
DAY AND TO RESOLVE THE CONFLICT IN THE
CIRCUITS RESPECTING WHAT A TITLE VII
DEFENDANT MUST SHOW TO REBUT A STATIS-
TICALLY SIGNIFICANT SHOWING OF RACIAL
DISPARITY.

In Bazemore v. Friday, this Court held that “a regres-
sion analysis that includes less that ‘all measurable vari-
ables’ may serve to prove a plaintiff’s case.” 478 U.S. at
400. The crucial question, the Court made clear, was
whether when omitted “factors were properly organized
and accounted for there was no significant disparity
between... blacks and whites.” Id. at 403 n.14. The Court
overturned the Fourth Circuit’s ruling that a statistical
analysis in a Title VII case could not constitute probative
evidence of discrimination merely because some vari-
ables had been omitted from the analysis. Id. at 399-400.

In the wake of Bazemore, the Courts of Appeals
remain confused as to what a defendant must show to
rebut a statistically significant showing of race-based dis-
parity in a Title VII case. Without mentioning Bazemore,
the Fifth Circuit in this case denied any probative force to
Hiil’s statistical analyses because they purportedly omit-
ted variables - experience and education - that might
explain the observed disparities between black and white
job seekers. MSES offered no alternative statistical analy-
ses showing that inclusion of the omitted variables would
eliminate the observed racial disparities. Nor did MSES
introduce any evidence tending to show that whites were
likely to possess the omitted traits in greater measure
than were blacks. To the contrary, MSES conceded that
Hill’s regression analysis showing discrimination

22

retained its statistical significance even if the omitted
variables were included. 918 F.2d at 1237; App. 10a-11a.

The Fifth Circuit’s holding conflicts directly with
well-established law of the District of Columbia Circuit,
as well as recent decisions of the Ninth and Second
Circuits - all of which have concluded that Bazemore
imposes at least a burden of production on Title VII
defendants to show that the omission of particular factors
would be likely to alter the race or gender-based dis-
parities shown by a plaintiff’s statistical analysis.

In the District of Columbia Circuit, a Title VII defen-
dant cannot defeat a statistically significant showing of
race-based disparity merely by alleging the plaintiff's
Statistical analysis omitted relevant considerations. Inter-
preting Bazemore, the D.C. Circuit has rejected “mere
conjecture or assertion on the defendant’s part that some
missing factor would explain the existing disparities.”
Palmer v. Schultz, 815 F.2d 84, 101 (D.C. Cir. 1987). Rather,
the D.C. Circuit applies a “rebuttable presumption of
equal distribution of the relevant . . . skills.” DeMedina v.
Reinhardt, 686 F.2d 997, 1008 (D.C. Cir. 1982); accord Segar
v. Smith, 738 F.2d 1249 (D.C. Cir. 1984). To overcome that
presumption, the defendant must, at a minimum, articu-
late a “basis for the assumption that such skills are in fact
unevenly distributed.” 686 F.2d at 1008.

The Ninth Circuit has similarly interpreted Bazemore
to hold that a Title VII “defendant cannot rebut an infer-
ence of discrimination by merely pointing to flaws in the
plaintiff’s statistics.” E.E.O.C. v. General Telephone Co. of
Northwest, Inc., 885 F.2d 575, 581 (9th Cir. 1989). Rather,
the Ninth Circuit held in General Telephone, the defendant

cane

23

must “produce credible evidence that curing the alleged
flaws would also cure the statistical disparity.” 885 F.2d at
583.

The Second Circuit reached the same result in Sobel v.
Yeshiva Univ., 839 F.2d 18 (2d Cir. 1988). In that case, the
plaintiff had used regression analyses to demonstrate
gender-based wage discrimination. The court rejected the
defendant’s unsubstantiated allegation that factors omit-
ted from analysis explained the observed disparities. /d.
at 34 (“no reason, in evidence or analysis, for concluding
that [omitted factors] correlated with sex and were there-
fore likely to affect the sex coefficient”).

This conflict is illustrative of a broader, continuing
uncertainty as to the factual showing a Title VII defen-
dant must make to rebut a statistically significant show-
ing of race-based disparity. Compare Catlett v. Missouri
Highway and Transp. Comm'n, 828 F.2d 1260 (8th Cir. 1987),
cert. denied, 108 S. Ct. 1574 (1988) (defendant must pro-
duce evidence in rebuttal), with E.E.0.C. v. Sears, Roebuck
& Co., 839 F.2d 302 (7th Cir. 1988) (no evidence required).
This Court should grant certiorari to resolve the conflict
and clarify the nature of the defendant’s burden in
response to statistically significant showings of racial dis-
parity in Title VII cases.

24

CONCLUSION

For all the foregoing reasons, the petition for cer
tiorari should be granted.

Respectfully submitted,

DonaLp B. Verrit, JR.*
JENNER & Biock

21 Dupont Circle, N.W.
Washington, D.C. 20036
(202) 223-4400

Sam H. BucHANAN, Jr.
Joun C. JoPLING
SOUTHEAST MississiPP!
LEGAL SERVICES
111 East Front Street
P.O. Drawer 1728
Hattiesburg, Mississippi 39403
(601i) 545-2950

July 29, 1991 Counsel for Petitioner

*Counsel of Record

———— ee

1
APPENDIX
TABLE OF CONTENTS
Page
Opinion of the U.S. Court of Appeals for the Fifth
ew a la
District Court Opinion........... 29a

Order on Rehearing...

|

la

Hazel HILL, Plaintiff-Appellant,
v.

MISSISSIPPI STATE EMPLOYMENT SERVICE, et al.,
Defendants-Appellees.

No. 89-4438.

United States Court of Appeals,
Fifth Circuit.

Dec. 13, 1990.

Black woman who sought job referrals through State
Employment Service brought action against Service alleg-
ing racial discrimination. The United States District Court
for the Southern District of Mississippi, Britt R. Single-
tary, United States Magistrate, rendered judgment for
Service and applicant appealed. The Court of Appeals
held that applicant failed to prove discrimination either
under disparate treatment or disparate impact analysis.

Affirmed.

Alvin B. Rubin, Circuit Judge, filed dissenting opin-
ion.

Sam H. Buchanan, Jr., Sam H. Buchanan, Jr., [sic]
Southeast Miss. Legal Services, Hattiesburg, Miss., for
plaintiff-appellant.

Richard D. Mitchell, Jackson, Miss., for defendants-
appellees.

Appeal from the United States District Court for the
Southern District of Mississippi.

Before GEE, RUBIN, and DAVIS, Circuit Judges.
PER CURIAM:

esis

2a
Applying both discrimination moe s {isparate
treatment and disparate impact “ " hat a black
female seeking job referrals from a ‘arge Dut under-

manned state employment agency fatied to prove a case
of discrimination under Title VII. Specific problems with
the referral system, established in the record, rebutted
any presumption of discrimination, and her statistical
analysis critically neglected qualifications and job prefer-
ences.

Background

Hazel Hill, a black female, sued the Mississippi State
Employment Service (MSES) on her own behalf, alleging
that MSES intentionally or recklessly discriminated in its
referrals on the basis of race. Her suit stemmed from her
dissatisfaction with the treatment which she received
when seeking job referrals to prospective positions as a
cashier, waitress, or cocktail waitress at MSES’s Hat-
tiesburg Office from April 1982 to April 1983, and fol-
lowed the right to sue letter issued to her by the Equal
Employment Opportunity Commission (EEOC) upon the
basis of its finding no reasonable cause to pursue the
complaint which she had filed against both MSES and the
Mississippi Employment Security Commission (MESC).!

MSES’s job referral procedures lie at the heart of this
case, and we therefore outline them. In almost all

' MESC belongs to the national network of state employ-
ment services established and funded by the Wagner-Peyser
Act, as amended, 29 U.S.C. §§ 49-49k. MSES is a division of
MESC and constitutes an employment agency as defined in
§ 701(c), 42 U.S.C. § 2000e(c).

3a

respects, MSES complies with the operational guidelines
established in the Employment Service Manual (ESMII).?
Operating through numerous local offices throughout
Mississippi, MSES refers qualified applicants to area job
openings listed with MSES by area employers, but does
not guarantee employment. The listing employers indi-
cate the number of applicants sought and the qualifica-
tions required, and MSES’s clerks process the listings and
notify qualified applicants.

To matc » applicants to jobs, MSES assigns applicants
and job orders a nine-digit Dictionary of Occupational
Titles Code (Dot Code).* The code’s first three digits

2 The district court found that MSES’‘s [sic] did not comply
with EMSII [sic] in one respect. EMSII [sic] § 1294, which bars
MSES’s processing of job orders containing discriminatory
preferences, also authorizes MSES to conduct two inquiries:
first, random investigations of employers to whom MSES
referred applicants if MSES receives, from any source, informa-
tion that the employer was discriminating; and second,
monthly random reviews. Despite testifying in a Title VII class
action against a local employer, the Director of MSES for 13
years prior to this suit testified that MSES conducted no such
inquiries during his tenure. We agree with the district court
that the one isolated incident neither shows that employers
filling positions through MSES widely discriminated nor
proves that MSES condoned such practices. Absent any evi-
dence as to the number of complaints, if any, lodged with
MSES about local employers, we, like the district court, must
decline to draw a pattern of historically condoned discrimina-
tion by MSES from the lack of random reviews by MSES.

3 First, referral applicants, with the assistance of an MSES
interviewer, pencil in a MSES 511 form that records their
education, training, work experience, job preference and any
other relevant information, and the assisting interviewer deter-
mines appropriate DOT Code(s). A UC-502 identification card

(Continued on following page)

4a

identify a particular occupational group, the middle three
the worker function ratings, and the final three the alpha-
betical order of the titles within the six digit code.

Referrals occur in two ways: In one, upon an appli-
cant’s request MSES clerks search job orders for vacancies
that match the applicant’s DOT code and, locating an
open order with a corresponding code, refer the applicant
if the applicant meets the listed qualifications; In the
other, to fill orders, pursuant to ESMII § 1470, MSES
clerks search the active files of applicants with a match-
ing occupational title and, if that yields an insufficient
number of applicants, search inactive files with matching
codes and active files of related occupational qualifica-
tions. Ultimately, to match job orders with the most quali-
fied applicant as per ESMII guidelines, MSES clerks
primarily rely on the DOT Codes, the type of job, and the
applicant’s experience and job preference, but as well
draw from personal knowledge acquired through prior

(Continued from previous page)

contains the applicant’s name, social security number, and
DOT Code/codes. MSES files the 511 forms alphabetically
under the appropriate three digit occupational group code.

Second, MSES interviewers code the employer job orders
that identify the available job, the number of vacancies, the
number of applicants sought, and job qualifications (i.e.: edu-
cation, experience). Before coding, Interviewers evaluate
whether the educational and experimental criteria provided by
the employer relate sufficiently to the open job, and if not,
whether MSES will require additional investigation prior to
processing the suspect order. Under MSES policy, interviewers
should dissuade employers from imposing arbitrary hiring
requirements and refuse to service discriminating job orders.
ESMII § 1294.

5a

referral matching, such knowledge including subjective
judgments (e.g.: an applicant’s attitude, appearance, per
sonality, employment history).

An EEOC officer regularly reviews MSES’s referral
and other services, assessing compliance with federal and
state civil rights laws. Documentation drawn from all
codes and applicants, but not from actual interviews,
furnishes all supporting information for these reviews.
Noting that the reviews to the date of trial highlighted
problem areas, the conducting officer rated MSES satis
factory overall.4

Coded for cashier-checker positions (211-492-014)
and for waitress positions (311-477-080), Hill alleges dis
criminatory referral practices and retaliatory practices. At
trial, she pointed to several occasions when MSES failed
to refer her to open iob orders for which she was coded

4 The evidence includes three such reviews. First, the
March 1979 review showed all services satisfactory for all but
black females, with job development and placement constant
for this group. Second, the February 1981 review posted job
development contacts for black females at 5% below the
benchmark and lacking in quantity, and demonstrated as well a
low quantity level of service for blacks. The February review
recommended referral to non-traditional jobs for minorities
and females reflect a racial and sexual mixture. Third, the
April, 1983 review noted that job development contact and
placement service for black females, actual referral for white
males, and placement after counseling for white males and
females fell below the benchmark. The April review suggested
that orders indicate a ractal/sexual mix of applicants, provided
MSES’‘s files included such applicants who would meet the
employer’s requirements, and that orders exclude non-bona
fide occupational qualifications (e.g.: “must be neat, clean &
attractive”).

6a

and qualified (qualified, that is, at least to an extent equal
to any referred white applicant).° MSES, for its part,

5 First, to one job order for a cashier, MSES referred 22
whites (5 were hired) and no blacks, 10 of the 22 whites were
out of code and 3 did not meet the minimal experience criteria
established by this order. Two had no experience and 5 lacked
the requisite education. While the order remained open, Hill,
who admittedly would have qualified for the job, sought refer-
rals, though not specifically asking for this position. MSES did
not refer Hill. Rather, the records, as stipulated, indicate that
during the period in which the order remained open and Hill
sought referrals, MSES referred Hill to alternate positions (to
Carriage Inn as housekeeper, to Church’s as counter attendant,
to Gold Post Restaurant as counter helper, and to Kentucky
Fried Chicken as cashier).

Second, the order for cashiers requesting ten referrals
remained open for 5 weeks; MSES referred only 5 applicants,
four whites and one black. Qualified blacks on file had the
appropriate DOT Code. Hill was not referred to this job order.

Third, a job order for emergency room technicians, also
open while Hill sought referrals, requested five applicants,
MSES referred only one white woman out of code. Hill, who
previously worked at a hospital, was not referred.

Fourth, one day after filing her EEOC charge, Hill sought a
waitress referral but was advised no such orders were avail-
able. Instead, MSES referred her to the Ramada Inn as a house-
keeper. Upon arrival, Hill testified she discovered an open
waitress position that had been filed with MSES. That same
day, at the direction of Hill's attorney, a white female employee
of a legal service organization, sought referrals for waitress
jobs with MSES, and the clerk, different than the clerk with
whom Hill spoke, provided her two waitress referrals.

Fifth, seeking referral to County Market General Store, Hill
was told there were no openings; she personally went to the
store and discovered an open position, and told a MSES clerk

(Continued on following page)

~ 7a

pointed to a record of MSES referrals received by Hill and
to Hill’s work history, showing ten positions held by Hill
prior to the period in question, with the length of each
generally fluctuating between a few weeks and a few
months.® All MSES employees with whom Hill had con-
tact specifically denied racial considerations in referral
selections, attributing referral problems, such as those
reflected in Hill’s evidence, to employee error.

Respecting the total number of MSES referrals during
the relevant period, Hill and MSES stipulated to white/
non-white ratios of applicants in the active file, overall an

(Continued from previous page)

that a white woman had been hired for the position. Hill
lacked one year’s experience in grocery checking as required
by the job order. The clerk gave her a referral to County
Market and Burgertown as a cashier.

© Specifically, Hill received 16 referrals between January
and June 1983, two as a housekeeper, five as a counter atten-
dant, four as a cashier, and five as a waitress. Ten occurred
after April 14, 1983 and all cashier referrals occurred after this
date. The Court specifically found all referrals occurred during
the relevant period. As pointed out, this finding is internally
inconsistent with declaring the relevant period to end on April
14, 1983.

Additionally, Hill was registered as a work incentive par-
ticipant in February 1983 and trained as a cashier-checker from
April to May 1983. Since April 1982, Hill worked as follows:
maid for three days, cashier for two weeks, attendant for 10
months, waitress for 7 months, and waitress.

|

8a

average of 58.2% white, 41.7% non-white.” As well, both
stipulated: MSES referred 473 applicants to orders classi-
fied in the 311 DOT Code (255 or 53.9% white and 218 or
46% black) from April 1982 to February 1983, and of the

78 referrals, 233 were referred out of their primary DOT
Code (120 or 51.5% white and 118 or 48.4% black.) Addi-
tionally, 41 of the 95 iob orders processed had more than
one referral, 31 of the 41 orders having both black and
white applicants, and of the 373 applicants referred to
these 31 job orders, 184 were white (49.3%) and 189 black

(50.6%).

7
TOTAL ACTIVE FILE WHITE NON-WHITE
April 1982 2518 1316 (52.2%) 1202 (47.7%)
May 1982 2593 1384 (53.3%) 1214 (46.8%)
June 1982 2940 ~=1608 (54.6%) 1332 (45.3%)
July 1982 3470 =: 1949 (56.1%) 1521 (43.8%)

Aug. 1982 3683 2124 (57.6%) 1559 (42.3%)
Sept. 1982 3243 = 1894 (58.4%) 1349 (41.5%)

Oct. 1982 3707 =. 2227 (60.0%) 1480 (39.9%)
Nov. 1982 3855 = 2312 (59.9%) 1543 (40.0%)
Dec. 1982 3517 2126 (60.4%) 1391 (39.5%)
Jan. 1983 3463 = 2100 (60.6%) 1363 (39.3%)

Feb. 1. ‘83 3775 = 2259 (59.8%) 1516 (40.1%)
Feb. 28. ’83 4107 2519 (61.3%) 1588 (38.6%)
OVERALL

AVERAGE 3405 1984 (58.2%) 1421 (41.7%)

TOTAL BLACK/WHITE DOT CODE 311
REFERRALS APRIL 1982-
FEBRUARY 1983 WHITE BLACK

473 255 (53.9%) 218 (46%)

* Hill denied that all 311 referrals above were waiter/ waitress.

9a

Without accounting for employer qualifications,
which may have rendered some applicants unacceptable
for referral, MSES filled relevant job orders from April
1982 to February 1983 as follows: processing six cocktail
waitress orders, shorting four, and referring in total 21
whites and no blacks; processing 39 waitress orders,
shorting 14 (11 of which referred no blacks), and referring
in total 113 whites and 46 blacks (but referring no blacks
to 24 of the 39 orders); and processing 146 cashier job
orders and referring in total 998 whites and 457 blacks
(but in 57 of the 146, referring only white applicants).®

Himmelstein, Hill’s statistics expert, analyzed the
actual referral pool derived from the stipulations above
and the unreferred pool as manifested in data generated
by a computer program developed to reflect referrals in
the 211 and 311 codes on the basis of race. MSES con-
trolled and supplied all information used to develop the
program and Hill’s computer expert ran the program on
MSES’s computers.’ The program searched MSES’s rele-
vant files to show an applicant's DOT Code on a given
date, and the data generated reflects black and white
unreferred applicants with either a 211 or 311 code dur-
ing the relevant time period. Looking for a pattern of
referral based on race and not attributable to chance,

% By “shorting,” we mean referring a number of applicants
less than that requested by the employer.

* The MSES systems analyst for 19 years, who assisted in
formulating the program, called it the best possible, but none-
theless inaccurate, because it drew data from the limited
ESARS system developed by the Department of Labor to report
record placement transactions. The ESARS system does not
account for applicants’ experience

10a

Himmelstein factored the data, generated by running the
program with the three digit numbers of the occupational
codes, into a formula to determine the number of stan-
dard deviations. For cocktail waitress, waitress, and cash-
ier positions, respectively, he calculated standard
deviations 4.88, 8.78, and 3.41, all of which are considered
statistically significant. Applying the formula to data gen-
erated from the entire nine-digit code, Himmelstein cal-
culated a standard deviation of 2.58 for the 211 Job
Orders and 1.92 for the 311 Job Orders. Few applicants or
referrals matched the nine digit code.

MSES’s statistical expert, Piette, considered the unre-
ferred pool generated by the program inaccurate,
whether generated from the nine or the three digit codes
Piette identified several additional problems in the pro-
gram: inability to distinguish part time from full time jobs
and an applicant’s preference; inability to assign value to
important factors such as education or experience; and
inability to consider difficulties or inabilities in contact-
ing particular applicants to apprise them of referrals.!°
Piette, however, admitted that changes in the program

'0 Hill provided some evidence regarding qualifications. A
vocational expert, Semko, reviewed the qualifications of the
269 whites referred in 87 job orders. MSES referred white
applicants equally or less qualified than Hill to 39 of the 87
orders, the referred white applicants’ qualifications falling
clearly below Hill’s in 25 of the 39, 66 of the 269 whites
referred had qualifications equal to or less than Hill’s, with 37
of the 66 clearly less qualified. Significantly, Semko excluded
from consideration the remaining 203, all being more qualified
than Hill.

lla

would only reduce the standard deviations calculated by
Himmelstein.

Examining the racial composition of the referred
applicant pool, Piette concluded MSES’s referrals and
referral procedures to be neutral. Based upon the print-
outs generated by Hill’s program. Piette found 65.9% of
all applicants (referred or unreferred) to be non-biack
compared to 34.1% black in the 211 code, and 50.1% non
black compared to 49.9 black in the 311 code. Only 13.5%
of the total 211 coded applicants (69.2% non-black, 30.8%
black) and 31.5% of the total 311 coded applicants (54.5%
white, 45.5% black) received MSES referrals. Analyzed by
racial composition, referrals neariy equalled the racial
composition of the applicant pool. The proportions of
out-of-code referrals by race among total referrals for the
211 code were 70.4% black and 64.3% white; for the 311
code, 78.9% black and 73.9% white. For out-of-code refer
rals to 211 positions, 32.8% were black and 67.2% white;
for 311, 47.1% black and 52.9% white

Racial Discrimination Claim

To locate our review today in the proper legal con
text, we briefly condense the Supreme Court’s methodol-
ogy for analyzing Title VII actions. The Court probes Title
VII actions under two well-established models for fer
reting out unlawful discrimination: disparate treatment
and disparate impact analysis. The first concentrates on
discriminatory motive, the second on discriminatory
effect. On the issue of discrimination, in either case, the
plaintiff bears the ultimate burden of persuasion; but the

onus of producing sufficient evidence for us to assess

12a

whether the plaintiff met this burden shifts. Wards Cove
Packing Co., Inc. v. Antonio, 490 U.S. 642, 109 S.Ct. 2115,
2120, 104 L.Ed.2d 788 (1989). Hill asks that her case be
analyzed under both models, and we do so.

Pinpointing both overt and covert discrimination,
disparate treatment analysis reveals differential treatment
of similarly situated persons on the basis of impermiss-
ible factors such as race or sex. Dislodging the status quo
of prior discrimination, disparate impact analysis dis-
closes the disproportionate impact of a facially neutral
but non-job-related policy upon a protected group such
as blacks or women. Griggs v. Duke Power Co., 401 U.S.
424, 429-30, 91 S.Ct. 849, 852-53, 28 L.Ed.2d 158 (1971).
Either model is applicable to employment practices that
utilize discretionary and subjective criteria. Watson v. Fort
Worth Bank & Trust, 487 U.S. 977, 108 S.Ct. 2777, 101
L.Ed.2d 827 (1988).

Only the disparate treatment model requires proof of
discriminatory animus, and it requires such proof
whether a given action alleges individual or class-wide
(pattern and practice) discrimination. Although, for indi-
vidual allegations, a single proven instance of unlawful
disparate treatment suffices, showing class-wide dispa-
rate treatment requires more than isolated or exceptional
instances of differential treatment. Hill does not assert
class-wide disparate treatment. In either case, the neces-
Sary animus may be shown directly or inferred from
circumstantial evidence.

Statistics play an important evidentiary role; circum-
stantial evidence of disparate treatment often includes

13a

(but need not) statistica) evidence, and a finding of dispa-
rate impact requires statistically significant disparities.
Statistics are not irrefutable; as the Supreme Court cau-
tioned, “they come in infinite variety.” Teamsters v. United
States, 431 U.S. 324, 340, 97 S.Ct. 1843, 1856, 52 L.Ed.2d
396 (1977). Indeed, we ourselves have noted that soundly
compiling and assessing statistics is “a task both complex
and arduous.” Wilkins v. University of Houston, 654 F.2d
388, 410 (5th Cir. 1981). Particularly in a case such as
Hill’s, alleging discriminatory referrals, we must care-
fully balance the danger of prejuuice to a defendant
posed by drawing inferences of discrimination from a
handful of referral decisions and the unfairness to the
Title VII claimant of imposing unattainable standards for
proof of discriminatory intent. Pegues v. Mississippi State
Employment Services, 699 F.2d 760, 769 (5th Cir. 1983).
Hence, we must be acutely aware that spotting mistaken
understandings or mischaracterizations of numerical data
either to suggest or to camouflage discrimination calls for
a finely tuned quantitative and qualitative eye.

With the proper methodology in mind, we turn to
Hill’s evidence. The case requires from us two standards
of review. Whether MSES unlawfully discriminated
against Hill constitutes the ultimate fact at issue in this
Title VII action, and consequently we address this issue
de novo. Even so, unless clearly erroneous, the trial
court’s findings of subsidiary fact bind us. Wilkins v
University of Houston, 654 F.2d 388, 390 (5th Cir. 1981)

A. Disparate Treatment

The district court properly divided its factual inquiry
into three stages: (1) Hill’s prima facie case; (2) MSES’s

14a

rebuttal; and (3) Hill’s showing of pretext. We follow suit.
First, we find no flaw in the prima facie test set forth by
us under similar facts and applied here by the District
Court. See Pegues at 774. Second, with reservations noted
below we accept MSES’s proffered rebuttal. Third, we
find that Hill failed to show pretext.

Following our lead, to establish her prima facie case
the court required Hill to prove by a preponderance of
the evidence (1) her membership in a protected group, (2)
her application and coding for an occupation for which
MSES was making referrals, (3) her failure to secure a
referral, and (4) MSES’s later referral of non-members of
the protected group. We agree that the specific incidents
of non-referral (supra, n. 5) establish Hill’s prima facie
case and engender a presumption of discrimination.

MSES countered, attributing its practices to ineffi-
ciencies inherent in a large, heavily-utilized, bureaucratic,
and undermanned system with limited resources. Specifi-
cally, MSES cited employee error or oversight, inefficient
communication between staff members, inability to con-
tact applicants, and applicants’ preferences. These, MSES
contends and the district court found, satisfy MSES’s
burden of producing a legitimate non-discriminatory rea-
son for its practices. Although we note our reservations
below, we must agree.

Accepting general inefficiency as a legitimate busi-
ness reason troubles us, for it seems a likely candidate for
use as a Shield for almost any employer - including a
discriminating one — to raise.'' As the Supreme Court

'! As the dissent aptly points out, on the average even
specifically demonstrated inefficiencies should weigh against

(Continued on following page)

15a

emphasizes, the desire to home in on the critical and
telling evidence schools our tripartite analysis. Texas
Department of Community Affairs v. Burdine, 450 U.S. 248,
256-57, 101 S.Ct. 1089, 1095-96, 67 L.Ed.2d 207 (1981). An
employer’s mere affirmations of good faith in individual
selections add no factual assistance and cannot ade-
quately rebut a prima facie showing of racial discrimina-
tion. International Bhd. of Teamsters v. United States, 431
U.S. 324, 342, n. 24, 97 S.Ct. 1843, 1858, n. 24, 52 L.Ed.2d
896 (1977); Pegues v. Mississippi State Employment Service,
699 F.2d 760, 766 (5th Cir. 1983).

Likewise, an utter lack of specifics on an employer’s
part does little to sharpen the fact-finder’s inquiry and is
equally unacceptable. Here, however, MSES does not
offer us an “utter lack of specifics,” but rather details the
numerous problems that produce its general inefficiency
- the district court finding sufficient evidence of each
problem and of efforts by MSES to combat it. Naturally,
the systematic problems proved to exist more credibly
spawn disparities in cases such as MSES’s, which involve
scores of different referrals to scores of different
employers, than in cases concerning the hiring practices
of a single employer for a single position. MSES need not
prove that the proffered reasons actually motivated it.
Burdine, 248 U.S. at 254, 101 S.Ct. at 1094. Proving that

(Continued from previous page)

blacks and whites equally. Because any given, individual prima
facie case of apparent disparate treatment may be explained on
such grounds of inefficiency, we should not presume slanted
effects. To show pretext, the plaintiff may demonstrate, with
properly compiled and analyzed statistics, a significant slant-

ing.

l6a

they did not is a task for Hill, as the plaintiff, in connec-
tion with the pretext issue. To overturn a finding as
clearly erroneous, the entire evidence must leave us with
a “definite and firm conviction that a mistake has been
committed”. Anderson v. Bessemer City, 470 U.S. 564, 105
S.Ct. 1504, 84 L.Ed.2d 518 (1985); United States v. Gypsum
Co., 333 U.S. 364, 68 S.Ct. 525, 92 L.Ed. 746 (1918) [sic].
While we would have preferred even greater evidentiary
support for MSES’s systematic problems, we cannot say
that court’s subsidiary findings were unsupported or
clearly erroneous; therefore, we must accept them.

If in truth an agency’s or an employer’s verified,
detailed and documented inefficiency, absent any dis-
criminatory animus, accounts for results that nonetheless
appear at first glance to be the product of discrimination,
it would be the height of unfairness to infer fallaciously
such a discriminatory animus. We do not mean to con-
done inefficiency; we simply cannot punish it under Title
VII. With solace, we note: the phrase “to raise a shield of
inefficiency,” no matter how well factored and docu-
mented, does not translate automatically as “to fend off a
claim of discrimination;” a claimant may show pretext.

To show pretext, Hill relied upon the statistical evi-
dence, but the lack of an experience component and a job
preference component render the statistics fatally defec-
tive. Pegues at 7/0. Lest we forget that MSES’s stated goal,
imposed by EMSII, is to match open jobs with the most
qualified applicants, corresponding referral decisions
turn heavily upon experience and education. Failure to
include these factors would render some applicants inel-
igible for referral, decreasing the size of the applicant

17a

pool upon which the statistical analysis rests and pro-
ducing misleading numbers.

It is true, as MSES’s expert testified, that incorporat-
ing these components would only lower the standard
deviations presented to us, but by how much we do not
know and the evidence does not tell us, particularly
given the components’ critical nature. Statistically
accounting for qualifications might explain the disturbing
number of short referrals, specifically those in which
MSES referred only whites (supra, p. 1237); but absent
such particularized accounting, we cannot distill discrim-
inatory animus from the practice. In her brief, pointing
out that the same DOT Codes include traditionally minor-
ity jobs (e.g., counter attendant) and traditionally white
jobs (e.g., waitresses), Hill accuses MSES of steering.
Again, we lack any concrete evidence upon which to base
such a conclusion. The Title VII plaintiff must ultimately
prove discrimination by a preponderance of the evidence;
and, accordingly, such evidentiary gaps weigh against
Hill.

The gaps in Hill’s statistics do not stand as the sole
barrier to her attempt to show pretext. MSES’s system,
though inefficient, appears facially to be neutral.
The percentages of referred and unreferred applicants
equalled the overall racial percentages in the 211 and 311
pool: The same is true for out-of-code referral (which
Slightly favored black applicants). Of course, facial neu-
trality at the bottom line cannot immunize an agency or
employer from proved acts of discrimination against an
individual; but, at the same time, we cannot infer dis-
crimination against an individual! from statistics display-
ing neutrality toward the group. Furnco Constr. Corp. v

18a

Waters, 438 U.S. 567, 579-80, 98 S.Ct. 2943, 2950-51, 57
L.Ed.2d 957 (1978) (“Proof that [a] work force was racially
balanced or that it contained a disproportionately high
percentage of minority employees is not wholly irrelevant
on the issue of intent when that issue is yet to be
decided”); cf. Connecticut v. Teal, 457 U.S. 440, 454, 102
S.Ct. 2525, 2534, 73 L.Ed.2d 130 (Racially balanced pro-
motions at the bottomline did not relieve an employer
from the requirement that it show that a written screen-
ing test, determining the eligible candidates for promo-
tion and disproportionately disqualifying blacks, was
sufficiently job-related).

B. Disparate Impact

Hill suitably identified the specific employment prac-
tice challenged - a referral system utilizing subjective
traits and out-of-code referrals — but again, her statistical
analysis failed her. Wards Cove at 109 S.Ct. 2124, citing
Watson. The figures — the same asserted to demonstrate
pretext under the disparate treatment model - do not
offer sufficient proof that the challenged practice dispro-
portionately affected a protected group (here, blacks)
because, again, these figures neglected the education and
experience factors critical to referral decisions. Since the
district court considered all the evidence, both statistical
and non-statistical, in reaching its conclusion of no dis-
crimination under the disparate impact model, we decline
Hill’s invitation to remand for any further findings.

Having reached the ultimate issue of discrimination,
and having found none, we need go no further. Yet, we
cannot permit future Title VII analysis to be tainted by

19a

the district court’s casual acceptance of the following
fallacy: both black and white MSES clerks serviced Hill;
therefore, she was not the victim of discrimination, (that
is, “Blacks never discriminate against other blacks.”) To
the argument’s self-evident overbreadth, we add that the
Supreme Court has rejected it. Castenada v. Partida, 430
U.S. 482, 513, 97 S.Ct. 1272, 1289, 51 L.Ed.2d 498 (1977). !?
We recognize the court’s blameless intent simply to
explain what inferences may be drawn from an
employer’s use of subjective criteria (which does not
“necessarily” indicate discriminatory animus or impact,
regardless of the determining individual’s color); but we
must be sure that the court’s dubious explanatory lan-
guage does not generate a later, ill-conceived concurrence

with the fallacy.

Retaliation Claim

To prevail on a retaliation claim, Hill must prove that
she engaged in a protected activity, that an adverse
employment action occurred, and that a causal connec-
tion between the two existed. McMillan v. Rust College,
Inc., 710 F.2d 1112 (5th Cir. 1983). Hill contends that her
EEOC complaint prompted MSES employees to harass
her. Specifically, the employees allegedly stared at her,
followed her, prolonged the time she spend waiting for a
clerk, relegated her file to black referral clerks, destroyed
her identification card, deleted experience data from her
511 form, and criticized her claim of discrimination to a
Work Incentive class. All of this, according to Hill, caused

12 Similarly, we reaffirm that adequately servicing Hill in
some areas (e.g. training) would not have excused discriminat-
ing against her in other areas. Pegues at 775

20a

here to be hospitalized and to miss referrals. The fact that
Hill received numerous referrals and continued services
after filing the EEOC complaint did not escape the dis-
trict court’s attention. In short, the magistrate sitting at
trial and observing the witnesses judged as more credible
the employees’ testimony denying Hill’s allegations:
MSES replaced rather than simply destroyed Hill's identi-
fication card; whether MSES employees actually men-
tioned Hiil’s claim to the Work Incentive class or, if they
did, what exactly they said, is unclear; and no testimony
indicated that MSES employees made any statements in
retaliation for Hill’s EEOC complaint. The above findings
not being clearly erroneous, we affirm the court's judg-
ment in MSES’s favor.

AFFIRMED.
ALVIN B. RUBIN, Circuit Judge, dissenting:

Inefficiency is racially neutral. It cannot of itself
account for racial discrimination. When a person estab-
lishes a prima facie case that a state agency has discrimi-
nated against her because of her race, | would not accept
as a “legitimate nondiscriminatory” reason for the
agency’s admitted difference in treatment between her
and the members of another race that the ineptness of its
employees, the inadequacy of its budget, the size of its
system, or the bureaucratic nature of the machinery it has
devised suffice to negate the discriminatory animus man-
ifested by the decisions, at least partially subjective, that
its own employees have made.

The Mississippi State Employment Service is not a
disembodied entity on high that functions independently
of its employees. It is itself the deus ex machina that puts

2la

the actors on the stage and directs them. The allegedly
inefficient, regulation-hamstrung, overworked employees
whom it has hired and through whom it functions are the
MSES. It may not wash its hands of the spots, whether
damned or merely discriminatory, by which their actions
have stained the MSES. Indeed were its employees
merely inefficient, their actions would not have resulted
in racial discrimination, for inefficiency would function
as much to hamper white as minority applicants in seek-
ing jobs. Yet MSES’s actions is fact put stumbling blocks
in Ms. Hill’s path that were not placed before the paths of
white job applicants.

In addition to my inability to accept the proffered
excuses as legitimate reasons for the nonreferral of black
applicants, | would find the magistrate’s findings of sub-
sidiary fact as to pretext clearly erroneous, and | would
find that Hill has established a violation of Title VII of the
Civil Rights Act of 1964, 42 U.S.C. § 2000e et seq., the Fair
Employment Practices Act, by disparate treatment. |
therefore respectfully dissent from the majority opinion
without reaching the disparate impact or retaliation
claims.

|. Disparate Treatment

The Act forbids racial, religious, and sexual discrimi-
nation in employment. In McDonnell Douglas Corp. v.
Green’ the Supreme Court set forth the basic allocation of
burdens and order of presentation of proof in a Title VII
case alleging discriminatory treatment. First, the plaintiff

' 411 U.S. 792, 93 S.Ct. 1817, 36 L.Ed.2d 668 (1973).

22a

has the burden of proving by the preponderance of the
evidence a prima facie case of discrimination. Second, if
the plaintiff succeeds in proving the prima facie case, the
burden shifts to the defendant “to articulate some legiti-
mate, nondiscriminatory reason for the employee’s rejec-
tion.”? Third, should the defendant carry this burden, the
plaintiff must then have an opportunity to prove by a
preponderance of the evidence that the legitimate reasons
offered by the defendant were not its true reasons, but
were a pretext for discrimination.*® To fulfill its duty of
articulating a legitimate non-discriminatory reason, the
defendant must clearly set forth, through the introduc-
tion of admissible evidence, the reasons for the plaintiff's
rejection. The explanation provided must be legally suffi-
cient to justify a judgment for the defendant.4

The magistrate found, and the majority opinion
affirms, that Hill established a prima facie case of racial
discrimination. The evidence of such discrimination was
not merely statistical. From April 1982 to April 1983, the
period in which Hill contends she was a victim of dis-
crimination, she sought employment as a waitress or a
cashier partially because she could earn more than the
minimum wage usually paid fast-food restaurant counter
attendants (who, because they not only accept and
deliver orders but receive payment are sometimes
denominated “cashiers”). As the majority opinion indi-
cates in a footnote,° on several occasions during the

2 Id., at 802, 93 S.Ct. at 1824.
3 Id., at 804, 93 S.Ct. at 1825.

4 Texas, Dept. of Community Affairs v. Burdine, 450 U.S. 248,
253, 101 S.Ct. 1089, 1094, 67 L.Ed.2d 207 (1981).

* Majority opinion, fn 5.

23a

period when Hill sought employment as a cashier or
waitress MSES demonstrated an unusual pattern of refer-
rals of applicants for the position of cashier.

Case 1. MSES referred 22 whites for interviews for
employment as cashier, of whom 5 were hired. It did not
refer a single black applicant. Ten of the 22 whites were
“out of code,
mary prior occupation and three did not even meet the
minimal experience criterion established by the job order.

Mf /

meaning that “cashier” was not their pri-

Two had no experience and five lacked the requisite
education. “While the order remained open, Hill, who
admittedly would have qualified for the job,” the major-
ity opinion condedes, “sought referrals, though not spe
cifically asking for this position,”® as indeed she could
hardly have done unless she had specific knowledge of
the job order. Instead, “during the period that this order
remained open and Hill sought referrals,” the MSES did

‘

refer her to what it calls “alternate positions,”7 all of them
stereotypical for black persons in the deep south: to a
motel as a “housekeeper,” an euphemism for a maid; to
two fast-food chains, Church’s and Kentucky Fried
Chicken as a “cashier”, and to another as a counter
helper. These were in effect jobs making beds or serving
fried chicken. It scarcely bears mention that MSES does
not contend that Hill was unqualified in any way for the

job to which only whites were referred.

Case 2. An order for cashiers requesting ten referrals
remained open for five weeks. MSES referred only five

6 Id
7 Id

24a

applicants, four of whom were white. Neither Hill nor
any other putatively qualified black was referred for the
remaining five interview slots.

Case 3. “[A] job order for emergency room techni-
cians, also open while Hill sought referrals, requested
five applicants. MSES referred only one white woman,
out of code. Hill, who previously worked at a hospital,
was not referred.”* MSES does not contend that Hill’s
prior hospital experience did not qualify her for at least
an interview with the employer, who requested four more
persons for interviews than the number actually referred.

Case 4. One day after she had filed her EEOC com-
plaint, Hill again sought a job referral as a waitress.
Instead she was referred to a Ramada Inn as a “house-
keeper.” Upon arrival she found that the Inn had filed a
request for a waitress with the MSES. “That same day, at
the direction of Hill’s attorney, a white female employee
of a legal services organization sought referrals for wait-
ress jobs with MSES, and the clerk, different than [sic] the
clerk with whom Hill spoke [sic], provided her two wait-
ress referrals.”?

We, as well as other courts, have recognized that
subjective selection processes tend to facilitate the consid-
eration of discriminatory criteria.'!? While the MSES

8 Id.
9 Id.

10 Roberts v. Gadsden Memorial Hospital, 835 F.2d 793, 798
(11th Cir. 1988); Payne v. Travenol Laboratories, Inc., 673 F.2d 798,
827 (Sth Cir. 1982); Cox v. American Cast Iron Pipe Co., 784 F.2d
1546, 1560 (11th Cir.), cert. denied, 479 U.S. 883, 107 S.Ct. 274, 93
L.Ed.2d 250 (1986).

25a

admits that the employees with whom Hill had spoken
did use subjective criteria as well as job codes in making
referrals, the job referrers denied racial considerations in
referral selection. Instead, the MSES and its employees
presented a united front: the problems merely reflected
employee error. The coincidence of such employee error
consistently operating to the detriment of Hill strains
credulity. A cashier may sometimes be “short,” that is,
she may sometimes turn in less cash than her register
records, but if this is due to error, then she ought also, at
lease on some occasions, to be “over,” having more cash
than the register records. There is reason to suspect the
employee who is always short and never over. Moreover,
Hiil’s statistical expert testified to a significant statisfical
deviation in referring blacks. Even the MSES’s statistical]
expert conceded that Hill’s data demonstrated that the
MSES system has a statistically significant disparate
effect on black applicants, although he rejected the mag-
nitude of the measure.

The majority refers to the MSES “system” as racially
neutra!. But verbal neutrality does not suffice to explain
discrimination in application. The MSES has not shown a
single instance in which its inefficient system favored
black employees or in which the failure to refer
employees to jobs resulted from difficulty in reaching Hill
- or from overwork - or from red tape. Presumably so
inefficient a system would sometimes result in the neglect
or oversight of white applicants. The evidence shows that

the MSES systems is inefficient only when it fails to refer
black employees.

26a

Il.

The majority opinion does not even attempt to define
what is meant by a legitimate nondiscriminatory reason.
It contents itself with the conclusion that an employer’s
inefficiency limited budget, self-manufactured red tape,
and the excessive work load it places on its own
employees, suffice. I submit that none of these alone nor
all together constitute legitimate reasons for discrimina-
tion. Surely the word “legitimate” must mean more than
simply non-criminal or not forbidden by law, for we
would not as a matter of course accept either a criminal
act or one otherwise forbidden by law as sufficient to
justify discrimination. Instead, a “legitimate” reason must
be one that is justifiable in view of the purposes of the
Fair Employment Practices Act.

The Supreme Court has given support to this inter-
pretation, stating that “[t]he broad overriding interest,
shared by employer, employee, and consumer, is efficient
and trustworthy workmanship assured through fair
and ... neutral employment and personnel decisions.”"!
A legitimate reason must be in some degree related to job
efficiency, the employer’s needs, or the applicant’s quali-
fications. That, to me, is implicit, though never expressed,
in Texas Department of Community Affairs v. Burdine.'?
Oversight of an applicant is not a legitimate reason, for,
like inefficiency, it does not serve any justifiable employ-
ment purpose. Thus, in Roberts v. Gadsden Memorial Hospi-
tal’? the employer responded to a prima facie case of

11 McDonnell Douglas, 411 U.S. at 801, 93 S.Ct. at 1823.
12 450 U.S. at 248, 101 S.Ct. at 1089.
13 835 F.2d at 793.

27a

disparate treatment by claiming that he had simply never
considered Roberts for the available position and there-
fore could not have been guilty of discriminatory intent.
Instead, he had hired someone with whom he was
friendly on a social basis. The court held that the
employer’s failure to consider Roberts was itself dispa-
rate treatment and therefore could not constitute a
defense:

where . .. an employer has reason to know that
an employee is qualified for a position and that
the employee might desire to be considered for
that position, the employer’s failure to consider
the employee for promotion is not a legitimate,
nondiscriminatory reason sufficient to rebut an
inference of intentional disparate treatment.!4

Cant by an employer and homilies against discrimi-
nation delivered to its employees do not suffice to explain
the discriminatory effect of its employees’ practices. If its
employees’ actions result in racial discrimination, their
malfeasance is not sufficient to rebut the inference of
racial discrimination already demonstrated by the plain-
tiff in establishing her prima facie case. The MSES is itself
responsible for its employees’ actions.

The need for efficiency constitutes a defense in dispa-
rate-treatment cases. It would be ironic if the employer’s
claim of its own inefficiency also served as a defense.

This ought to dispose of the defense to the disparate-
treatment case. Even if it does not, I submit that the

14 Id. at 798. But see Gaballah v. Johnson, 629 F.2d 1191 (7th
Cir. 1980).

28a

magistrate was clearly erroneous in concluding that the
reasons advanced by MSES were not a pretext. The MSES,
acting through its employees — the only way in which it
could act — intentionally discriminated against Hill.

For these reasons, I would reverse the judgment,
render judgment in Hill’s favor on her discrimination
claims and remand the case to the district court to deter-
mine the appropriate remedy.

29a

IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF MISSISSIPP!
SOUTHERN DIVISION

HAZEL HILL PLAINTIFF
VERSUS CIVIL ACTION NO. H83-0281(W)

MISSISSIPPI STATE EMPLOYMENT SERVICE,

HATTIESBURG DIVISION; MISSISSIPPI

EMPLOYMENT SECURITY COMMISSION;

O.H. SIMMONS, EXECUTIVE DIRECTOR;

HUGH GIBSON, WILLIAM G. LEONARD,

and MARY BRYANT, COMMISSIONERS
DEFENDANTS

MEMORANDUM OPINION

FILED
MAY 01 1989

This cause came on for trial on December 12, 1988 in
the United States District Court for the Southern District
of Mississippi, the Honorable Britt Singletary presiding
and this Court, having heard and considered all testi
mony and having thoroughly reviewed all the evidence,

enters the following opinion:

I. PROCEDURAL HISTORY

Plaintiff, Hazel Hill (“Hill”) is an adult black female
resident of Forrest County, Mississippi. Defendant, Mis-
Sissippi State Employment Service (“MSES”) is a division
of Defendant Mississippi Employment Security Commis-

sion (“MESC”) which is a member of the national net-

work of state employment services established and
funded by the Wagner-Peyser Act, as amended, 29 U.S.C

sna eaeameeaa

30a

§ 49 through 49(k). MSES is an employment agency as
defined in § 701(c), 42 U.S.C. § 2000(e)(c).

The relevant time period in the present case is April
1, 1982 to April 14, 1983. During this period, Hill sought
job referrals as a cashier, waitress and cocktail waitress
from MSES’s local office in Hattiesburg, Mississippi. On
March 8, 1983, Hill filed a complaint with the Equal
Employment Opportunity Commission (“EEOC”) against
MSES and MESC alleging racial discrimination against
each for failing to refer Hill to jobs for which she was
qualified. The EEOC found no reasonable cause to pursue
Plaintiff’s allegations but issued a right to sue letter on
July 5, 1983.

On September 2, 1983, Hill filed the present com-
plaint! alleging that MSES intentionally and/or recklessly
discriminated against her based on race in their job refer-
ral practices. Her claims are based on Title VII of the Civil
Rights Act of 1964, 42 U.S.C. § 2000(e), et seg. The suit is
an individual claim of discrimination as Hill seeks declar-
atory and injunctive relief and backpay as remedies for
the alleged discriminatory acts and practices.

II. MSES’S REFERRAL PROCEDURES

MSES operates numerous local offices throughout the
State of Mississippi which provide job referrals to appli-
cants. MSES does not guarantee employment but only

1 For purposes of this opinion, it is only necessary to
outline the claims which were tried before the court. Any
remaining claims were either voluntarily dismissed by Hill or
dismissed by action of the District Court.

31a

refers qualified applicants to jobs in the area. Area
employers place job orders with MSES expressing both
the number of applicants sought and the qualifications
required of each applicant. MSES’s clerks process each
job order and notify the qualified applicants of the job
opening

MSES’s job referral service is accomplished by utiliz-
ing a nine digit Dictionary of Occupational Titles Code
(hereinafter referred to as “DOT Code”). Each applicant
seeking a job referral from MSES is interviewed and
provided a MSES 511 form. The interviewer records the
applicant’s education, training, work experience, job pref-
erences and other relevant information on the 511 form.
Based on this information, each applicant is assigned a
corresponding DOT Code.

The first three digits of the DOT Code identify a
particular occupational group, 1.e., 311 = waiter/waitress
and related food services. The middle three digits iden-
tify worker function ratings. The final three digits indi-
cate the alphabetical order of the titles within the six digit

code.

The 511 form is recorded in pencil to permit updating
and is filed alphabetically under the appropriate three
digit occupational group code. Applicants also fill out a
UC-502-identification card which contains their name,
social security number and DOT Code or Codes.

MSES’s interviewers process employer job orders
Employer orders inciude information concerning the job,
the number of vacancies, number of applicants sought

32a

and job qualifications, including education and experi-
ence requirements imposed by the employer. Inter-
viewers were authorized to evaluate whether educational
and experiential criterion were sufficiently job-related
and if not, whether additional investigation was required
prior to processing any suspect job order. MSES’s policy
encouraged interviewers to dissuade employers from
imposing arbitrary hiring requirements. Discriminating
job orders were not serviced pursuant to the guidelines
established in the Employment Service Manual II, § 1294
(hereinafter “ESMII”). ESMII provided operational guide-
lines, with which MSES was required to comply.

Once the necessary information concerning the job
order was gathered, interviewers coded each job vacancy
in the order according to the DOT Code classification
used for applicants.

Once an applicant requested a referral, the inter-
viewer or clerk would search the job orders for vacancies
matching the applicant’s 511 form. If the search produced
a matching order which was open and which the appli-
cant was qualified for referral, the clerk would refer the
applicant.

Pursuant to ESMII, § 1470, interviewers were to first
search active files of applicants with a matching occupa-
tional title and code to the employer order. If the search
failed to produce sufficient applicants, interviewers were
directed to search inactive files with matching codes and
active files of related occupational qualifications, namely,
those files with a matching first three digit group.

The primary factors considered were the DOT Codes,
the type of job and the applicant’s experience and job

a

33a

preference. Interviewers also relied on personal judgment
and experience in matching referrals and such decisions
included subjective factors including the applicant's atti-
tude, appearance, personality, employment history and
other relevant job-related factors. Pursuant to the guide-
lines established in the ESMII, MSES attempted to match
job orders with the most qualified applicant.

The Court’s finding on these matters is based on the
testimony of Jimmie Poole, the placement supervisor at
the Hattiesburg office during the relevant period and the
testimony of Betty Pace and Larry Hurt, referral clerks in
the Hattiesburg office during the relevant period.

Additionally, certain applicants were classified as
either Extended Benefit Applicants or Federal Supple-
mental Compensation Claimants. Federal and state stat-
utes require that such applicants be referred to any job
for which they are qualified provided such positions pay
minimum wage. They were not priority referrals and

separate files reflecting these applicants were not kept by
MSES.

During the period of April 1, 1982 through April 4,
1983, Hill was coded for cashier-checker (211-462-014)
and waitress (311-477-030). Her primary claims concern
alleged discriminatory acts and practices in making such
referrals as well as claims of retaliation as a result of her
filing an EEOC charge.

Il. EVIDENTIARY FINDINGS

At trial, Hill offered historical, circumstantial, direct
and statistical evidence to establish her prima facie case.

34a

MSES offered statistical and other evidence in rebuttal.
Upon review of all the evidence, this Court finds:

A. Historical Evidence

Pursuant to ESMII § 1294, MSES’s employees are
required to refuse to process job orders where an
employer has stated discriminatory preference. Section
1294 also authorizes random investigations of employers
who received referrals where the office had information,
regardless of the source, that the employer was discrimi-
nating. Random referral reviews of one month were also
authorized.

Based on the testimony of Herman Teal, the Director
of MSES for 13 years prior to the filing of the present suit,
this Court finds no such investigations were conducted
during a 13-year period prior to the institution of this
suit. The Court further finds that this evidence alone is
insufficient to establish a pattern of historically condoned
discrimination by MSES. There is no evidence as to the
number of complaints, if any, lodged with MSES about
local employers.?

B. Circumstantial Evidence

MSES was subject to yearly Equal Employment
Opportunity Compliance reviews wherein their referral

* Although Teal testified in a Title VII class action against
a local employer, Neco, an isolated incident does not constitute
wide-spread employer discrimination or MSES condonation of
such practices.

35a

and other services were evaluated with regard to federal
and state civil rights laws.

A review dated March 2, 1979 found “the level of
service” satisfactory for all groups except black females.
Job developments and placements were constant for this
group. A review dated February 25, 1981 found Job
Development contacts for black females five percent
below bench mark and lacking in quantity. The quantity
level of service for blacks was reported as low.

The same review recommended a sexual and racial
mixture be reflected in referrals to non-traditional jobs for
minorities and females. The recommendation noted
active applicants from each group when job orders were
received.

An EEOC compliance review dated April 21, 1983
recommended job orders should include a mixture of
applicants based on race and sex provided such appli-
cants were in the file and met the employer’s require-
ments. Additionally, the review recommended that non-
bona fide occupational qualification statements (i.e.,
“Applicant must be neat, clean and attractive”) should be
avoided on orders. The review also found black females
below bench mark for job development contact and place-
ment after job development. White males were below
bench mark in actual job referrals, while males and
females were below bench mark in applicants placed after
counseling.

The EEOC reviews discussed above were conducted
and authored by Mr. Lewis Beverly, a black male EEOC
officer in charge of training MSES’s staff with regard to
applicable EEOC regulations and civil rights laws. As is

36a

evidenced by the reports, MSES’s Hattiesburg office per-
formance was rated satisfactory overall. Mr. Beverly testi-
fied the reviews highlighted problem areas which needed
improvement. He further testified his recommendations
were based solely on documentation rather than actual
interviews with the applicants. Further, the figures
reflected in the reviews were based on all codes and
applicants. He stated it was impossible to refer every
applicant to a particular job and noted that MSES’s per-
sonnel worked to improve the areas noted in the reviews.

Herman Teal testified measures were instituted in an
effort to improve areas reported in the EEOC reviews.
Such measures involved adding more blacks to the staff,
creation of the affirmative action compliance plans and
minority forums.

C. Direct Evidence

Additionally, Hill pointed to specific incidents of
alleged discrimination in job referrals. The first incident
involved referrals of cashiers to Hudson’s, a department
store in Hattiesburg, Mississippi. Lewis Beverly testified
that upon reviewing this job order, he noted that 22 white
applicants were referred, 5 of whom were hired. No black
applicants were referred. Beverly stated Hill was quali-
fied for this job. He also noted that 10 of 22 whites
referred to this order were referred out of code and 3 did
not meet the minimal experience criteria established by
the employer. Two of the 22 referrals had no experience
required by the job order and 5 of the 22 referrals lacked
the educational requirements.

37a

Marie Edwards and Kay Hildebrand, MSES’s clerks,
each admitted Hill was qualified but was not referred.
The records of referrals indicate Hill had been referred to
the Hattiesburg Ramada Inn on January 10, 1983. Beverly
opined that Hill may have been considered inactive and
therefore not referred to the Hudson’s opening. However,
Beverly noted that the Hudson’s job order was opened
January 12, 1983 and was not closed until March 18, 1983
and that Hill sought-referrals in February and March

MSES conceded the referrals to Hudson’s did not
meet the ESMII standards. However, the Hudson’s job
order was 1 of 142 orders processed by MSES which was
subject to review. Additionally, the records, as stipulated,
indicate Hill received the follOwing referrals:

(1) February 11, 1983 - referred to Carriage Inn

as housekeeper;
(2) February 11, 1983 — referred to Church’s as

counter attendant;

(3) February 23, 1983 — referred to Gold Post
Restaurant as counter helper; and

(4) March 2, 1983 - referred to Kentucky Fried
Chicken as a cashier (position filled how-
ever).

A second incident involved referral for cashiers at a
local convenience store which opened February 1, 1983
and closed March 7, 1983. According to Beverly, the job
order requested ten referrals but only five applicants
were referred by MSES. Four of the applicants were white
and one was black. Hill was not referred to this job order
Beverly stated short referrals were areas of concern which
were discussed with local managers. He added qualified

blacks on file had the appropriate DOT Code.

38a

A third order of concern to Beverly involved referral
of applicants as an emergency room technician which
opened March 2, 1983. Five referrals were sought but
only one white female was referred. Additionally, the
referral was out of code. Beverly noted that Hill had
previous work experience at a hospital but was not
referred.

On March 10, 1983, one day after Hill filed her EEOC
charge, she sought a waitress referral from MSES but was
advised no such orders were available. She was referred
tc Ramada Inn as a housekeeper but testified that upon
arrival she discovered a waitress job was available and on
file with MSES. On the same date, Shirley Herrin Garri-
son, a white female employee of the Southwestern Missis-
sippi Legal Services, sought referrals for waitress jobs
with MSES upon the direction of Jeremy Eisler, Hill’s
attorney. Marie Edwards, a black MSES clerk, gave her
two waitress referrals to Chez Paul and Pier 49. Edwards
testified that Hill sought referrals from Kay Hildebrand
and that Hildebrand might not have been aware of the
job orders from Chez Paui or Pier 49. She added it was
common for interviewers’ awareness of specific job
orders to be staggered. She testified one interviewer may
receive the order and begin filling it before the other
interviewers learned it had come into the office.

In May 1983, Hill testified she requested a cashier
referral to County Market grocery store but was told no
openings were available. However, she later went to the
store and learned such a position was open. Larry Hurt, a
black male MSES employee, recalled the incident and
stated Hill saw him that morning and requested such a
referral. However, he testified he was not aware of sucha

39a

position. Hill called again that afternoon stating a white
woman had been hired for the position. Although Hill
lacked one year’s experience in grocery checking as was
required by the job order, Hurt testified he gave her a
referral to County Market and Burgertown as a cashier.
His failure to locate the initial order was explained as an
oversight on his part.

MSES offered evidence of Hill’s prior work history
which showed Plaintiff held ten different positions prior
to the period in question. The length of each job fluctu-
ated between a few weeks and a few months. Her longest
period of employment was from September 1979 through
April 1982. From February 1979 through August 1979,
Hill held two jobs at the same time.

MSES also offered evidence which showed Hill
received 16 referrals between January and June 1983. Of
these referrals, two were as a housekeeper, five were
referrals as a counter attendant, four were referrals as a
cashier and five were referrals as a waitress. Ten of the
referrals occurred after April 14, 1983 and all cashier
referrals occurred after this date. Although there is some
dispute as to the date of referrals referred to above, the
Court finds they all occurred during the relevant period

Hill was also registered as a work incentive partici
pant in February 1983 and was trained as a cashier-
checker from April 1 through May 3, 1983. Since April
1982, Hill has been employed as follows

40a

(1) Maid —- Ramada Inn - January 23-25, 1983;

(2) Cashier - Krystal Restaurant - June 15-July
1, 1983;

(3) Attendant — Hattiesburg Convalescent Cen-
ter — June 1983-March 30, 1984;

(4) Waitress - Days Inn Hattiesburg - February
30-O* ober 1, 1988;

(5) Waitress - Days Inn Meridian - November
1, 1988-present.

Additionally, MSES offered evidence to show Hill
had personal contact with six MSES employees. Four of
the employees were black, Marie Edwards and Larry
Hurt, both black employees, testified race played no fac-
tor in their decisions to refer Hill to any particular job.
Each denied any personality conflicts with Hill and stated
referral problems such as those reflected in the Hudson’s
job order were isolated incidents caused by employee
error as opposed to condoned or wide-spread practices
by MSES. All MSES employees denied racial consider-
ations in referral selections.

E. Statistical Evidence

Either by way of expert witnesses or through stipula-
tions, each party offered statistical evidence reflecting the
total number of referrals, referrals of 311 DOT Codes, and
other such evidence in support of their cases. This evi-
dence can be summarized as follows:

4la

TOTAL ACTIVE FILE WHITE NON-WHITE
April 1982 2518 1316 (52.2%) 1202 (47.7%)
May 1982 2593 1384 (53.3%) 1214 (46.8%)
June 1982 2940 1608 (54.6%) 1332 (45.3%)
July 1982 3470 1949 (56.1%) 1521 (43.8%)
August 1982 3683 2124 (57.6%) 1559 (42.3%)
September

1982 3243 1894 (58.4%) 1349 (41.5%)
October 1982 3707 2227 (60.0%) 1480 (39.9%)
November

1982 3855 2312 (59.9%) 1543 (40.0%)
December

1982 3517 2126 (60.4%) 1391 (39.5%)
January 1983 3463 2100 (60.6%) 1363 (39.3%)
February 1,

1983 3775 2259 (59.8%) 1516 (40.1%)
February 28,

1983 4107 2519 (61.3%) 1588 (38.6%)
OVERALL

AVERAGE 3405 1984 (58.2%) 1421 (41.7%)
TOTAL BLACK/WHITE DOT CODE 311
REFERRALS APRIL 1982-FEBRUARY 1983

WHITE BLACK

473 218 (46%)

* Hill denied that all 311 referrals were waiter/waitress

42a

The above totals reflect 95 job orders processed by MSES.
Forty-one orders had more than one referral and 31 of
these referrals had both black and white applicants. A
total of 373 applicants were referred to these 31 job
orders, 184 white (49.3%) and 189 black (50.6%). Of the
entire 473 referrals in the 311 DOT Code, 233 applicants
were referred out of their primary DOT Code. Of these
referrals, 120 (51.5%) were white and 113 (48.4%) were
black.

During April 1982 through February 1983, MSES pro-
cessed six identifiable cocktail waitress job orders refer-
ring 21 whites and no blacks. Four job orders referred less
applicants than requested. See Pretrial Order (“PTO”)
Section 8, No. 40, page 28. Thirty-nine job orders for
waitress were processed during this same period and 113
whites and 46 blacks were referred. Twenty-four of those
orders referred no blacks and 14 orders referred less than
the number of applicants requested. Eleven of the short
referrals referred only white applicants. See PTO Section
8, No. 41, pages 28-29. One hundred forty-six cashier job
orders were processed with 998 whites referred and 457
blacks. In 57 of the 146 job orders, MSES referred only
white applicants. The total percentages of these job
orders are as follows:

3 The information and figures discussed above were stipu-
lations entered by the parties and made part of the pretrial
order in Section 8, pages 26-28.

43a

BLACK REFERRALS WHITE REFERRALS
6 cocktail jobs 0% 100%
39 waitress jobs 28.5% 71.1%
146 cashier jobs 31.4% 68.6%

See Plaintiff’s Exhibit 10.4

In addition, Hill offered testimony from Mike
Rodgers, a computer programming expert. Rodgers was
hired to develop a computer program which reflected
referrals in 211 and 311 codes on the basis of race. All
information used to develop the program was controlled
and supplied by MSES and the program was run on
MSES’s computers. Rodgers submitted the program to
MSES for objections or suggestions for the program in
order that the data compiled would reflect an accurate
reference pool from which a statistical analysis could be
calculated.° The data generated by the Rodgers program
was submitted to Dr. Jerry Himmelstein, an expert in
statistics.

Dr. Himmelstein testified he based his statistical
analysis on two sources: (1) the actual referral pool
derived from the stipulations entered by the parties and
contained in the pretrial order and (2) the unreferred pool
as generated by the Rodgers program. The analysis was

4 The totals cited above reflect total job referrals in those
categories for the period April 1982 through February 1983.
They do not take into account employer qualifications which
may have rendered some applicants unacceptable for referral.

> Rodgers’ program searched MSES’s relevant files in
order to show an applicant’s DOT Code on a given date. The
data generated reflects black and white unreferred applicants
with either a 211 or 311 code during the relevant time period.

44a

designed to determine whether there was a pattern of
referral based on race and whether that pattern was
attributable to discriminatory or non-discriminatory prac-
tice or whether the result was created by chance. Initially,
Himmelstein ran the program with the entire nine digit
number but it had to be inaccurate because few appli-
cants or referrals matched the nine digit code. Instead,
the program was run and data obtained based on the
three digit numbers of the occupational codes. The results
were factored into a formula to determine the number of
standard deviations. Standard deviations determined
whether the results showed a significant statistical dis-
parity between observed referrals and expected referrals.

The following indicate the results of Himmelstein’s
statistical analysis of black referrals to cocktail job orders,
waitress job orders and cashier job orders serviced during
the applicable period as calculated using the Rodgers
three digit program:®

JOB ORDER STANDARD DEVIATIONS
(1) Cocktail waitress 4.83 7
(2) Waitress 8.78
(3) Cashier 3.41

(All standard deviations considered statistically signifi-
cant.) See Plaintiff's Exhibit 10.

®’ The formula used to calculate the standard deviations
was approved by the Fifth Circuit in Pegues v. Mississippi State
Employment Services, 699 F.2d 760 (5th Cir. 1983).

Finally, Himmelstein applied the formula to the

Rodgers program which used the entire nine digit code

and calculated the following standard deviations

DOT CODE STANDARD DEVIATIONS
211 Job orders 2.58 -
311 Job orders 1.92

See Plaintiff's Exhibit 33

Himmelstein concluded these figures resulted in
Statistically significant disparity in racial referrals. Both
he and Rodgers felt the program developed by Rodgers
provided an accurate pool from which a reliable statisti
cal analysis could be conducted and Himmelste‘» opined
that a pattern of racial disparity in referrals which disad

vantaged blacks occurred during the period in question

MSES challenged the statistical findings through tes
timony from Linda Monk and Dr. Mike Piette. Monk was
a systems analyst employed by MSES for 19 years. She
worked on the ESARS system developed by the Depart
ment of Labor to report and record placement transac
tions. She assisted Rodgers in formulating his program
but stated MSES had never attempted to develop such a
pool. She also felt Rodgers formulated the best possible
program but the results did not reflect an accurate pool
Specific objections to Rodgers program interposed by
MSES were: (1) applicants could change from active to
inactive within one day; (2) applicant could terminate or
change offices on a particular day; and (3) duplicate
social security numbers would produce an inaccurate
pool. Both Rodgers and Himmelstein stated these objec

tions were of little consequence as they focused on active

ee

46a

transactions on a particular date in an effort to create an
accurate referral pool.

Dr. Piette, an expert in labor economics and applied
Statistics, also testified the Rodgers pool was inaccurate
regardless of whether the nine or three digit run was
utilized to generate the pool. Of the two runs, Piette
noted the nine digit run was more precise, thereby
reflecting the better pool. Using Plaintiff’s printouts,
Piette found that 65.9% of all total applicants (referred or
unreferred) in the 211 DOT Code were non-black and
34.1% were black. For the 311 code, the percentages were
50.1% non-black and 49.9% black. Only 13.5% of the 211
applicants received referrals while 31.5% of the 311 appli-
cants received referrals. Of those in the 211 code, 69.2%
were non-black and 30.8% were black. In the 311 code,
54.5% of referred applicants were white and 45.5% were
black. The referrals by racial composition were about
equal to the applicant’s pool racial composition. See
Defendant’s Exhibit 6, pages 1-4. Other relevant findings
showed that more blacks were classified as 211 and 311 in
Forrest County than white applicants. The percentages of
out-of-code referrals in the 211 and 311 DOT Codes were

as follows:

CODE BLACK WHITE
211 32.8% 67.2%
311 47.1% 52.9%

The proportion of out-of-code referrals by race among the
total referrals were as follows:

iti eenemeeeieieneemdnieiamemniimiel

47a

CODE BLACK WHITE
211 70.4% 64.3%
311 78.9% 73.9%

Based on these figures, Piette opined the procedures
employed as well as the actual referrals made were neu-
tral.

Additional problems with the Rodgers program as
identified by Piette included an inability to distinguish
between part-time and full-time jobs and an applicant’s
preference for one or the other, an inability to assign
value to important factors such as education or experi-
ence and an inability to consider difficulties or inabilities
to contact a particular applicant in order to apprise them
of the referral. However, Piette admitted that changes in
the program would only reduce the standard deviations
calculated by Himmelstein and further conceded that
with a .05 significance level of disparity, a standard devi-

ation of 1.96 would be statistically significant.

Finally, Dr. Elizabeth Semko, a vocational expert,
reviewed the qualifications of the 269 whites referred in
87 job orders. Of this number, she found that 39 of the job
orders had white applicants referred with qualifications
equal to or less than Hill. Twenty-five of the 39 job orders
and white applicants referred with qualifications clearly
below or less than Hill. Of the 269 applicants referred, 66
had qualifications equal to or less than Hill and 37 of
those had qualifications less than Hill’s. The results were

based on the applicant’s 511 forms and DOT Codes

assigned each. Two hundred three applicants were better

48a

qualified than Hill and were excluded from consider-
ation. In Dr. Semko’s opinion, these figures were statis-
tically significant indicating a disparity in referrals.

F. Evidence of Retaliation

Hill also alleged that MSES retaliated against her for
the March 8, 1983 filing of an EEOC complaint. In support
of this claim, Hill offered proof that on March 10, 1983,
she sought a waitress referral but was only referred as a
maid. On that same date, Shirley Herrin, a white female,
received two waitress referrals.

Additionally, Hill testified Marie Edwards tore up
her identification card. Edwards recalled the incident but
stated the card was destroyed and replaced with an
updated card. Hill claimed she was followed and stared
at by Betty Pace on April 18, 1983. Pace had no recollec-
tion of the incident but stated she had followed appli-
cants out of the building before either unintentionally or
because she needed something from the applicant.

On April 28, 1983, Hill stated she came to MSES’s
office at 8:00 a.m. to seek a referral to County Market
grocery store but was kept waiting for over an hour and
did not receive the referral until she demanded it later
that afternoon.

All MSES employees denied knowledge of the inci-
dent and stated it was unusual for applicants to be kept
waiting. Larry Hurt recalled the County Market referral
but explained his failure to refer Hill was the result of
oversight on his part rather than a retaliatory action
against Hill.

49a

Marie Edwards admitted that MSES employees were
told Hill had filed a complaint but denied that it played
any factor in referrals. Larry Hurt testified he was
unaware of the EEOC charge at the time of the County
Market incident. Charles Brown, a Work Incentive
(“WIN”) counselor, admitted knowledge of the suit but
stated all WIN participants were treated the same and
required strict compliance with the rules of the program
for all participants. He denied referring to Hill's lawsuit
in front of the entire WIN class. Jacqueline Jones, Hill's
WIN supervisor, denied making statements about the
suit. Laura Payton, a WIN participant, testified Charles
Brown did comment on the suit to the class. However,
Brown stated Payton asked about Hill’s suit and he
changed the subject.

The evidence shows that Hill received 11 referrals
after she filed her EEOC complaint, including 3 cashier
referrals other than the County Market incident and 3
waitress referrals. See PTO, Section 8, paragraph 1, pages
19-20. Hill was also registered in the WIN program dur-
ing this period and receive cashier-checker training. See
PTO, Section 8, paragraph 2, pages 20-21. In 1986, Hill
received 21 referrals for MSES (16 wai

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Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385009_2451%3A1. Public record. Not legal advice.