Petition — Pegues v. Mississippi State Employment Service

No. 83-

IN THE ene

Supreme Court of the Anited States

OCTOBER TERM, 1983

RosIE LEE PEGUES, et al.,

Petitioners,

Vv.

MississipP1 STA**! EMPLOYMENT SERVICE, et al.,

Respondents.

PETITION FOR A WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF

APPEALS FOR THE FIFTH CIRCUIT

WILLIAM L. ROBINSON

RICHARD T. SEYMOUR*

Lawyers’ Committee for

Civil Rights Under Law

520 Woodward Building

733 Fifteenth Street, N.W.

Washington, D.C. 20005

(202) 628-6700

NAUSEAD STEWART

Lawyers’ Committee for

Civil Rights Under Law

720 Milner Building

210 South Lamar Street

Jackson, Misgissippi 39201

(601) 948-5400

Attorneys for Petitioners

July 1983 *Counsel of Record

eee ee

PRESS OF BYRON S. ADAMS PRINTING, INC., WASHINGTON, D.C. (202) 347-8203

QUESTIONS PRESENTED

This is a class action against a State

Employment Service under Title VII of the

Civil Rights Act of 1964, 42 U.S.C. §§ 2000e

et seg., challenging racial and sexual dis-

crimination by the agency in deciding which

applicants to refer to employers with job

vacancies. The questions presented are:

1. Where the employment agency enforces

an employer's educational and other require-

ments for entry-level jobs and makes no

effort to use its power to demand evidence of

the job-relatedness of such requirements, and

where Census statistics would suffice to show

disparate impact in an action against the

employer, does the mere fact that the action

is brought against the employment agency

mean that such statistics are no longer suf-

ficient to show disparate impact?

2. Where plaintiffs have made statis-

tical and other showings of classwide

ay a

discrimination, are mere armchair specula-

tions of the defendants---to the effect that

inclusion of other factors in the analysis

might possibly lead to a different result,

without ever putting on evidence supporting

sf the conjecture---sufficient to cause the

rejection of plaintiffs' statistics and to

relieve the defendants from a shifting of

) the burdens of production and persuasion?

- iii -

Petitioners:

Rosie Lee Pegues

Rebecca Gillespie

Mary Boyd

Robert Williams

Members of the certified class:

a. All Black persons who have

sought, or are seeking, or might seek

employment through the services offered

by the Bolivar County office of the

Mississippi State Employment Service

and who have been or may be in the

future, discriminated against on the

basis of race in the referrals for

employment made by said office.

b. All females who have sought,

or are seeking, or might seek employ-

ment through the services offered by

the Bolivar County Office of the

Mississippi State Employment Service

and who have been or may be in the

future discriminated against on the

basis of sex in the referrals for

employment by said office.

Respondents:

Mississippi State Employment Service of the

Mississippi Employment Security Commission

John C. Aldridge

Ernest C. Lindsey

U.S. Secretary of Labor

U.S. Employment Service

Page

Opinions Below 1

Jurisdictional Statement 2

Statute Involved 2

Statement of the Case 3

1. The Proceedings Below 3

2. The Activities of MSES 9

3. Education and Experience

Requirements 14

4. Other Evidence of Discrim-

ination in the Classifica-

tion and Referral of Appli-

cants 19

Reasons Why the Writ Should Be

Granted 24

1. The Decision of the Court of

Appeals Involves an Important

Question Under Title VII Which

Should be Settled by This

Court 24

2. The Fifth Circuit's Rejection

« ie =

Table of Contents

of Census Data as Proof of

the Disparate Impact of an

Educational or Other Require-

ment is in Conflict With the

Decisions of This Court 31

3. Allowing a Defendant's

Unsupported Speculation to

Defeat Showings of Discrim-

ination Based on Statistics

and Other Proof Conflicts

With the Decisions of This

Court and of Other Circuits

Conclusion

Table of Authorities

l. Cases

Albemarle Paper Co. v. Moody,

422 U.S. 405, 45 L.Ed.2d 280 (1975)

Board of Trustees of Keene State

College v. Sweeney, 439 U.S. 24,

58 L.Ed.2d 216 (1978)

Davis v. Califano, 613 F.2d 957

icc. Cave, 1972)

Dothard v. Rawlinson, 433 U.S. 321,

53 L.Ed.2d 786 (1977)

Furnco Const. Corp. v. Waters,

438 U.S. 567, 57 L.Ed.2d 957

(1978)

Grant v. Bethlehem Steel Corp.,

635 F.2d 1007 (2nd Cir., 1980),

cert. den., 452 U.S. 940,

69 L.Ed.2d 954 (1981)

Griggs v. Duke Power Co.,

401 U.S. 424, 28 L.Ed.2d 158

(1971)

33

36

27,30

28

35

26,31,

36

o wi =

Int'l Bhd. of Teamsters v. United

States, 431 U.8. 324, 52 L.8B4.24

396 (1977) 34,36

McDonnell Douglas Corp. v. Green,

411 U.S. 792, 36 L.Ed.2d 668

(1973) 28

Payne v. Travenol Laboratories,

565 F.2d 895 (5th Cir.), cert.

den., 439 U.S. 835, 58 L.£4a.2d 131

(1978) 15

Texas Dept. of Community Affairs v.

Burdine, 450 U.S. 248, 67 L.Ed.2d

207 (1981) 28

United States v. County of Fairfax,

Virginia, 629 F.2d 932 (4th Cir.,

1980), cert. den., 449 U.S. 1078,

66 L.Ed.2d 801 (1981) 35

United States Postal Service Bd.

of Governors v. Aikens, U.S. P

75 L.Ed.2d 403 (1983) 28

Vuyanich v. Republic Nat'l Bank of

Dallas, 505 F.Supp. 224 (N.D.

Tex., 1980) 26

2. Statutes

§ 703(b) of the Civil Rights Act

of 1964, 42 U.S.C. § 2000e-2(b) 2,27

28 U.S.C. § 1254(1) 2

Title VII of the Civil Rights Act

of 1964, 42 U.S.C. §§ 2000e et seg. passim

Wagner-Peyser Act, 29 U.S.C.

§§ 49-49k 9

IN THE

SUPREME COURT OF THE UNITED STATES

OCTOBER TERM, 1983

No. 83-

ROSIE LEE PEGUES, et al.,

Petitioners,

Vv.

MISSISSIPPI STATE EMPLOYMENT

SERVICE, et al.,

Respondents.

PETITION FOR A WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF

APPEALS FOR THE FIFTH CIRCUIT

Petitioners Rosie Lee Pegues et al.

respectfully pray that a writ of certiorari

issue to review the judgment and opinion of

the United States Court of Appeals for the

Fifth Circuit entered on March ll, 1983.

OPINIONS BELOW

The April 29, 1983 Order of the Court

of Appeals denying the petitions for rehearing

and the suggestion for rehearing en banc is

a a

reproduced in the Appendix at App. la. The March

ll, 1983 Opinion of the Court of Appeals is

reported at 699 F.2q 760, and is reproduced in

the Appendix at App. 3a. The March 7, 1980

decision of the district court is reported at

488 F, Supp. 239, and is reproduced in the

Appendix at APp. 66a. The March 7, 19809 Final

Judgment of the district court is reproduced

in the Appendix at App. l5la.

JURISDICTIonaL STATEMENT

The opinion and judgment of the Court of

Appeals were entered on March 11, 1983, Peti-

tioners and the Mississippi respondents filed

timely Petitions for rehearing, and peti-

tioners filed a timely Suggestion for rehearing

en banc. The petitions and suggestion were

denied on April 29, 1983. App. la. The jurisdic-

tion of this Court rests on 28 U.S.C. 5 1254(1).

STATUTE INVOLVED

This case is brought pursuant to § 703(b)

of the Civil Rights Act of 1964, 42 U.S.c.

$ 2000e-2(b), which provides:

(b) It shall be an unlawful employ-

ment practice for an employment agency

to fail or refuse to refer for employ-

ment, or otherwise to discriminate

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

l. The Proceedings Below

Plaintiffs filed their original EEOC

charges in early 1970, and timely filed their

judicial Complaint in January 1972. This

case was certified as a class action covering

black applicants and female applicants at the

Cleveland (Bolivar County) branch office of

the Mississippi State Employment Service

("MSES"). It did not challenge the internal

employment practices of MSES, but challenged

racial and sexual discrimination in MSES's

activities as an employment agency, in choosing

which applicants to refer to employers with

jobs to fill.

After a three-week trial, the district

court found against plaintiffs on all issues

but on. ek entered final judgment against

plaintiffs on all issues, but did not enter

specific findings of fact on most of the

stdin” ae did not address all of the

claims over which it had jurisdiction.

On March 11, 1983, the court of appeals

affirmed in part and reversed in part.

l1/ The exception was the trial court's

- finding that MSES's enforcement of Travenol

Laboratories' tenth-grade educational require-

ment for Operative jobs (Assemblers and

Material Handlers) was discriminatory, but

that plaintiffs should have no relief because

the servicing of Travenol's job orders ended

in November 1971, two months prior to the

filing of the judicial Complaint in this case.

App. 143a-145a. The court of appeals did not

address plaintiffs' appeal from this denial

of relief, despite the personal injury suf-

fered by the plaintiffs and the injury suf-

fered by class members up to November 1971,

twenty-one months after the filing of EEOC

charges. MSES continues, to this day, to

enforce unvalidated educational requirements

set by employers. The issue is hardly moot.

2/ The court of appeals so recognized

at App. 24an. 7.

= § ‘=

3/

It found that MSES had engaged in classwide

sexual discrimination against women by auto-

matically enforcing employers' stated sexual

preferences that only applicants of a spe-

cific gender be referred on certain job

orders, without requiring from the employers

any showing that the preferences were sup-

ported by a bona fide occupational gqualifi-

cation. (App. 32a-35a). The court of

appeals also found that MSES had abused its

coding system, which is supposed to ensure

that applicants are classified in the occupa-

tional codes for the jobs they are best fit

to perform, and which is also supposed to

ensure that all applicants in the same job

4/

code have the same opportunity of referral.

3/ Because of the death of the trial

judge, the court of appeals made its own find-

ings. App. 24an. 7.

4/ The court of appeals described the

operation of the coding system in detail at

App. l2a-l7a. See also infra at 20-21.

The court of appeals found that MSES had

engaged in classwide racial discrimination

against blacks in the "systematic referral

of applicants to positions other than those

for which they were classified"---i.e., that

MSES had overridden its own determination of

qualifications. Whites not coded as quali-

fied in desirable clerical and sales occupa-

tions were disproportionately referred to

employers with clerical and sales vacancies;

blacks not coded as suitable for less desir-

able service occupations were disproportion-

ately referred to employers with service

jobs; of those disproportionately few whites

referred out-of-code to service jobs, a

large number were referred for desirable

waitress positions; the blacks referred out-

of-code to service jobs were mostly re-

ferred to stereotypically black jobs such as

domestic servant or cook. (App. 35a-36a).

The court of appeals also found that one of

-7J-«

the named plaintiffs had been discriminated

against because of ier race. (App. 38a n.

10, 63a-65a).

In all other respects, the court of

appeals affirmed the district court. Like

the district court, it failed to decide a

number of the issues over which it had juris-

pe Oe It rejected the bulk of plain-

tiffs' statistical evidence as insufficient

to shift the burden of production and of

persuasion to the defendants, and according-

ly did not evaluate the defendants' statis-

tical evidence. (App. 45a-46a).

5/ These included MSES's enforcement of

Travenol's educational requirements which

had already been found to have had racially

disparate impact against blacks and to have

been unlawful (see n. 1, supra) and MSES's

continued servicing of Travenol job orders

despite its own officials' awareness that

Travenol imposed hiring requirements on

blacks which it did not impose on whites.

Plaintiffs' exhibit 116 is an MSES document

showing its officials' knowledge that

Travenol rejected all black applicants un~

less they were known and recommended by three

particular black individuals. (Tr. 2285-87).

Petitioners have no idea why the court of

appeals failed to decide this issue.

For the purposes of this petition, the

relevant holdings of the court of appeals

were (a) that the types of Census statistics

this Court has always held sufficient to

show the racially disparate impact of an

employer's educational requirement or other

objective requirement could not be used to

show the racially disparate impact of an

employment agency's enforcement of the identi-

cal requirement (see infra at 14-18); (b)

that a novel standard crafted by the court

of appeals in this case must be used instead,

despite the fact that it would as a practi-

cal matter be impossible to apply (see infra

at 25-26); and (c) that plaintiffs' statisti-

cal showings of classwide disparate impact

and of classwide disparate treatment were in-

adequate to shift the burdens of production

and of persuasion to the defendants because

of mere conjectures by the defendants, un-

supported by any record evidence, that

@- 9 @

factors not included in the analysis might

conceivably had led to different results if

they had been included. (See infra at 19-23).

Plaintiffs are thus required, as part of

their initial showing of discrimination, to

disprove virtually all conceivable nondiscri-

mMinatory explanations for the disparate re-

sults shown, simply to protect their case

from a kind of mandatory presumption flowing

from a defendant's armchair speculation.

2. The Activities of MSES

The Mississippi State Employment Serv-

ice is a division of the Mississippi Employ-

ment Security Commission, and is a part of

the nationwide system of State and local

employment services funded and regulated by

the United States Employment Service under

the Wagner-Peyser Act, 29 U.S.C. §§ 49-49k.

(App. 7a n. 3). The court of appeals sum-

marized its operations as follows:

This office, like all other MSES

branch offices in Mississippi, func-

tioned as a labor exchange, matching

- 10 -

qualified applicants with available

jobs. Employers make known openings

by placing "job orders." Appli-

cants make known their availability

by requesting job referrals. The

Cleveland office accounted for approxi-

mately 25% of all new hires in the

Bolivar County labor market.

(App. 13a).

Bolivar County, in which this case

arose, is in the Mississippi Delta. Like

the rest of the Delta, many persons of both

races live in rural areas and are in competi-

tion for entry-level jobs---particularly

entry-level industrial jobs. The court of

appeals noted that many blacks had been dis-

placed from agricultural work "following the

mechanization of farm labor in the 1960s",

and noted MSES's arguments as to "the severe

educational and experiential deficiencies

characteristic of Bolivar County's predomi-

nantly black population." (App. 47a). For

the hopes of employment of large numbers of

blacks in Bolivar County, it is therefore

imperative to insist that only job-related

- ll -

education and experience requirements be used

for entry-level jobs; otherwise, large num-

bers of perfectly capable black workers will

be frozen out of the more desirable blue-

collar, waitress, and similar positions for

the rest of their ee 4

The manager of the MSES office in ques-

tion admitted that through the mid-1960's

blacks had traditionally been confined to a

relative handful of jobs in the area, and

that whites had traditionally done every-

thing else. (Tr. 822-23). He testified

that, at least through 1978---the year prior

to trial---blacks had less training and ex-

perience than whites. (Tr. 2465-66). An

official from MSES State headquarters ad-

mitted that this racial stratification of

employment meant that experience require-

ments could have a racially disparate

6/ In light of the cited discussion of

the court of appeals, its refusal to find

any disparate impact of any educational or

experience requirement is, to say the least,

odd. See infra at 14-18.

- 12 -

7/

impact against blacks. (Tr. 2281).

Plaintiffs' contention, in a nutshell,

is that MSES has acted to reinforce the

existing racial stratification of the job

market. For example, even where an employer

with an entry-level job does not have an

experience requirement, MSES's referral

decisions are based heavily on experience,

because prior experience is the most

important---on this record, the almost ex-

clusive---determinant of the occupational

codes to which applicants are assigned and

which govern their chances for referral.

(Tr. 821, 894, 2167-72, 2303-04; MSES Ex-

hibit 80). The cited testimony is all from

MSES officials; there is no dispute on this

point.

7/ Given such testimony by MSES offi-

cials, the court of appeals' finding of no

disparate impact in the servicing of ex-

perience requirements (App. 38a) seems

doubly odd.

- 13-

The importance of the activities of

MSES in Bolivar County cannot be exaggerated.

MSES Exhibits 44-52 and 55 show that in the

five years from 1973 through 1978, referrals

by MSES resulted in a total of 6,997 hires

in on-agricultural jobs in Bolivar County.

This figure becomes even more impressive in

light of the 1970 Census, which showed that

total employment of persons 16 years old and

over in Bolivar County was only 13,942 in 1970.

(Stipulation Exhibit 50, p. 26-290).

While MSES can only offer a referral to

an employer, its own exhibits 44-52 and 55

show that most applicants referred are in

fact hired by the employers to which they

are referred. For all referrals during

those five years, the hire rate ranged from

a low of 67.5% to a high of 93.1%. For re-

ferrals of black applicants during that same

period, the hire rate ranged from a low of

61.2% to a high of 98.1%. In most periods,

@ 14 @

it was within a few points of the overall

hire rate. Thus, referral is in many cases

almost tantamount to a hire by the employer.

It is undisputed that some employers

refuse to consider applicants who have not

been referred to them by MSES. (Tr. 276-78,

980-81, 993-95). To this extent, being

denied a referral by MSES is tantamount to

being denied a job. Even without such a

formal bar, it is clear on this record that

a black or female applicant's best hope of

getting an entry-level job is through MSES.

3. Education and Experience Require-

ments

MSES accepts and enforces the job re-

quirements set by local employers, including

education and experience requirements.

Taking educational requirements as an example,

it is undisputed that MSES enforced a large

number of entry-level job orders with educa-

tional requirements such as a college re-

quirement for a motel secretary position and,

- 15 -

more routinely, l12th-grade requirements for

general clerical and office jobs, messenger

jobs, and sales clerk jobs, l10th-grade re-

quirements for waitress jobs, dry cleaner

attendant jobs, entry-level factory jobs at

Baxter Laboratories ("Travenol") and others.

Travenol's l2th-grade requirement for office

and clerical jobs, and its i0th-grade re-

quirement for Assembler ("Table Worker") and

Material Handler ("Material Coordinator")

jobs have previously been found unlawful in

other Title VII SEN aig

Plaintiffs challenged the MSES defend-

ants' practice of automatically enforcing

the educational requirements of employers as

long as MSES has people to refer who meet the

requirements, without obtaining from the

8/ As to the l2th-grade requirement, see

Payne v. Travenol Laboratories, 565 F.2d 895,

899 (5th Cir.), cert. den., 439 U.S. 835,

58 L.Ed.2d 131 (1978); as to the 10th-grade

requirement, the district court so recognized

in its opinion on liability herein. App. 143a-

144a.

- 16 =

employers any information showing that the

requirements are job-related. It is undis-

puted that this was the actual practice of

the MSES defendants: their own officials so

9/

testified, and plaintiffs were entitled to

rely on these admissions as controlling, not-

withstanding the pro forma disclaimers in

official manuals which were summarized by

the court of appeals at App. l6a-17a.

To show the disparate impact of the

educational requirements, plaintiffs relied,

first, on stipulated Census statistics show-

ing that the requirements disqualified from

two to three times as many blacks as

10/

whites; second, on the defendants' own

9/ Testimony of the MSES local manager,

Tr. 976-80; testimony of Mr. Ballard and Mr.

Hart, MSES officials, in plaintiffs’ exhibit

150, Dep. Tr. 5, 8, 24-25, 29, 59-60.

10/ These statistics showed that a 12th-

grade requirement in Bolivar County excluded

89.8% of black males and 85.9% of black fe-

males, but only 44.4% of white males and 39.6%

(footnote cont'd)

= 17 =

expert study of applicants at the Cleveland

office confirming these epasee; Siena,

on referral statistics showing that the rate

of black referrals went down sharply as the

educational requirements ecedauaay anh,

fourth, on the prior judicial findings of

disparate impact as to Travenol's educational

requirements (supra note 1). The evidence

as to the racially and sexually disparate

impact of the experience requirements

(footnote cont'd)

of white females. The parties had stipulated

that a l0th-grade requirement excluded 78.4%

of black males and 70.8% of black females,

but only 28.3% of white males and 22.8% of

white females. (Stipulation { 69).

ll/ The study showed that black appli-

cants at the MSES local office had statisti-

cally significantly less education than white

applicants at that office in all years studied

(Tr. 1429-36; State defendants' exhibit 71).

12/ Blacks were 44.5% of the persons re~

ferred on all job orders, 33.5% of the persons

referred on job orders with l10th-grade require-

ments, 17.1% of the persons referred to jobs

with l2th-grade requirements, and 0% of the

persons referred to jobs with college degree

requirements. (Plaintiffs' exhibit 8).

- 18 -

13/

serviced by MSES was similar.

The court of appeals held that plain-

tiffs had not proven the disparate impact of

the educational and experience requirements

serviced by MSES, because their showings of

disparate impact were not broken down "by

comparison with the appropriate cross-section

of the relevant labor market." This is a new

legal standard, never previously applied by

any court. Moreover, the court faulted plain-

tiffs for using subjective judgments of a lay

witness to challenge only those educational re-

quirements and experience requirements which

14/

seemed doubtful to plaintiffs.” App. 37a-38a.

3/ And see the discussion supra at 10-

12.

14/ plaintiffs' exhibits did not list all

educational and experience requirements, be-

cause plaintiffs did not wish to challenge

obviously proper requirements, such as a

degree in Accounting for an accountant's posi-

tion. Plaintiffs' exercise of discretion

aided the defendants, not harmed them, by

restricting the challenges defendants had to

meet.

J

- 19 -

4. Other Evidence of Discrimination

in the Classification and Referral

of Applicants

It is not necessary, for the purpose of

this petition, to discuss in detail the evi-

dence on which petitioners relied below.

Most of the evidence was undisputed, and the

dispute at trial went to its relevance and

weight rather than to its accuracy.

Plaintiffs made a number of statistical

showings tending to ,»rove that whites and

males were referred to higher-paying job

vacancies than similarly qualified blacks and

women, that MSES had classified whites and

males in "occupational codes" which were more

desirable than those into which blacks and

women had been classified, and similar dif-

13/

ferences. MSES did not dispute the accuracy

15/ Plaintiffs also relied on the U.S.

Labor Department's 1968 findings of racial

and sexual discrimination as to the Cleve-

land office, on the EEOC's detailed findings

of reasonable cause to believe that there had

been such discrimination, on the anecdotal

. (footnote cont'd)

- 20 -

of any of these statistical compilations,

but challenged only the weight tu be given

them.

The court of appeals rejected the bulk

of this evidence, on the essentially specu-

lative ground that factors other than those

analyzed might account for the racial and

sexual disparities shown, although there was

no proof that any such factors could or

would have accounted for the disparities.

For example, one set of plaintiffs'

statistics showed that whites and males in

"available applicant pools" had much higher

rates of referrals to job vacancies than

blacks and women in the same "available

applicant pools". The "pools" had been

(footnote cont'd)

evidence of class members and of the named

plaintiffs, on the testimony and admissions

of MSES officials, and on exhibits showing

the available information about white appli-

cants coded in desirable occupations and

black applicants coded in less desirable, low-

paying, traditionally-black occupations.

- 21 @-

constructed along the lines recommended by

MSES's own expert, and consisted of persons

MSES itself considered equally qualified for

16/

referral, by assigning them to the same

occupational codes. Thus, these exhibits

accepted at face value MSES's own assess-

ments of experience and education. The

court of appeals' entire discussion of this

evidence is as follows:

Plaintiffs contend that statis-

tically significant discrepancies in

the frequency of refferrals for whites

and blacks during the years 1974

through 1978 has been established.

These data tell us nothing of the

relative qualifications of blacks and

whites in the available applicant

pools, or of the requirements imposed

by the employers to whom referrals

were made. Factors other than race

may explain the variations in referral

rates observed. To conclude otherwise

would necessitate an impermissible

degree of speculation.

16/ MSES had so represented to the

trial court in its September 27, 1979 Pro-

posed Findings of Fact and Conclusions of

Law at 17; it did not disagree when peti-

tioners quoted this representation at oral

argument in the court of appeals.

~ 39 =

(App. 43a) (Emphasis supplied). Given the

representation by MSES and the lack of any

evidence in rebuttal, it would be specula-

tive to reject this evidence, not to accept it.

The opinion of the court of appeals

shows numerous examples of refusals to con-

sider plaintiffs' statistics probative be-

cause of conjectures as to (a) work prefer-

ences (at App. 25a-28a), although MSES ad-

mitted that such oreferences had little or no

effect on its decisions, and were not even

recorded for each applicant (Tr. 883-85, 2168-

69); (b) the "availability of alternate jobs at

the time of interviewing" (App. 27a- 28a), al-

though job orders were placed year-round and

there is no evidence of any strange patterns in

the timing of job orders that would account

for the racial and sexual disparities shown;

(c) the relative experience of applicants (Id.),

although MSES had conceded that applicants in

the same code were equally qualified and should

- 23 -

have had equal chances of referral; (d) the

proportions of blacks and whites eligible for

job development activities (App. 44a-45a),

although both skilled and unskilled applicants

were eligible (Tr. 2445) and there is no basis

for supposing that the proportions would be

any different than the racial proportions

among all applicants in the office; and (e)

the conjectural possibility that experienced

Nurse's Aides would have been referred to a

Nurse's Aide training program without being

tested, and that this would have happened to

sO many more whites than blacks, as to account

for the sharp racial differences in referral

rates on which plaintiffs had relied to show

the disparate impact of the Nurse's Aide test

17/

(App. 55a-56a).

17/ There is no dispute on the record

that all applicants referred to this train-

ing program were test-selected. Both sides

agreed. (Tr. 1591, 2488-89). The court of

appeals' statement to the contrary (App.

55a-56a) is an apparent oversight.

- 24 -

REASONS WHY THE WRIT SHOULD BE GRANTED

l. The Decision of the Court of Appeals

Involves an Important Question Under

Title VII Which Should Be Settled By

This Court

The applicability to State Employment

Services ot the same Title VII standards

which govern employers is of great public

importance. The actions of the Cleveland

office of MSES are far from unique; MSES of-

ficials admitted that all 82 local offices

of MSES followed the same practices as the

Cleveland office with respect to enforcement

of employers' educational and experience re-

quirements. (Plaintiffs' exhibit 150, Dep.

Tr. 24-25, 29, 59-60). The U.S. Employment

Service has never indicated to MSES that it

regards these practices as causing any con-

flict with the pro forma statements in its

Employment Security Manual, to the effect

that interviewers have "authority to deter-

,

mine whether any educational and experiential

criterion was sufficiently job-related",

o 26 e

App. l6éa-l7a, and it seems likely that every

State and local employment service in the

county automatically and without inquiry en

forces an employer's educational and experi-

ence requirements as long as there are enough

people~-~no matter if disproportionately

white or male--~-to refer who meet the require-

ment.

The decision below effectively immunizes

such conduct from judicial scrutiny. A

"comparison with the appropriate cross~sec~

tion of the relevant labor market" is a stand-

ara well-nigh impossible to meet. Pub-

lished Census statistics do not break down

educational attainments by race and occupation

combined. Special Census computer runs 7~~7~OFr

door-to-door surveys ~~~would be required. Con-

tracting with the Census Bureau to do a

special computer run on its raw data would be

expensive, aS would a door-to-door survey.

Moreover, such a standard is unfairly

« 96 «

weighted in favor of Title VII defendants.

For example, the educational attainments of

local factory workers in Bolivar County would

certainly be skewed by the effect of

Travenol's former educational requirements

for such positions, and by those of other

employers. In effect, plaintiffs would be

required to show the disparate impact of an

educational requirement by reference to a

population prescreened by education. Judge

Higginbotham rejected such an approach in

Vuyanich v. Republic Nat'l Bank of Dallas,

505 F.Supp. 224, 356 (N.D.Tex., 1980), be-

cause it would effectively render Griggs v.

Duke Power Co., 401 U.S. 424, 28 L.Ed.2d 158

(1971), a "dead letter".

The effect the Fiftn Circuit's rule

would have on the enforcement of Title VII

would be drastic. Separate suits would have

to be brought against each employer with an

educational or experience requirement for an

ae oy

entry-level job. Census statistics would be

sufficient to show the disparate impact of

the requirement, infra at 31-32, but the

class in each such case would normally con-

sist only of the few persons who had applied

directly with the employer. Most blacks and

women harmed by the requirement would have

been screened out by the local employment

service before they would have had a chance

to file an application; they would thus be

unable to obtain any relief against the em-

ployer. If the employment agency enforcing

a discriminatory requirement cannot be

challenged under the same standards applicable

to employers, the intent of Congress in

enacting § 703(b) of the Act would be entire-

ly thwarted. So, too, the "make whole" and

"deterrent to discrimination" purposes of

Title VII back pay awards would be thwarted.

See Albemarle Paper Co. v. Moody, 422 U.S.

405, 45 L.Ed.2d 280 (1975).

= 28 -

Finally, this Court has several times

found it necessary to address the order and

shaping of proof in individual disparate-

treatment cases, to provide needed guidance

to the courts of es The need for

such guidance is even greater in classwide

disparate-treatment cases and in disparate-

impact cases, as the decision below makes

clear.

The question of the types of evidence

necessary to show the disparate impact of an

objective requirement is extremely important

to Title VII litigants, who must shape their

proof in advance of trial and who do not have

the ability to gather new types of evidence

18/ United States Postal Service Bd. of

Governors v. Aikens, ose; , 44 L.eaved

403 (1983); Texas Dept. of Community Affairs

v. Burdine, 450 U.S. 248, 6/7 L.Ed.2d 207

(1981); Board of Trustees of Keene State

College v. Sweeney, 439 U.S. 24, 58 L.Ed.2d

216 (1978); Furnco Const. Corp. v. Waters,

438 U.S. 567, 57 L.Ed.2d 957 (1978); McDonnell

Douglas Corp. v. Green, 441 U.S. 792,

36 L.Ed.2d 668 (1973).

- 29 -

when settled standards are changed without

warning after the close of the record.

As to classwide disparate treatment,

the lower court's approach merits the review

of this Court because it effectively makes

statistical proof of discrimination impossible.

The nature of statistics is that they are a

summary; any reasonably provable statistical

showing will be finite, and there will always

be a possibility that some other factor might

make a difference in the results. If any

statistical showing can be rejected on the

basis of a defendant's armchair speculation

as to such factors, without any requirement

that the defendant offer proof to back up its

speculations, then Title VII plaintiffs must

either make statistical showings of discri-

mination so inclusive that they would be pro-

hibitively expensive, or forego the use of

statistics altogether.

- 30 =

The practical effects of the Fifth

Circuit's decision on the private enforce-

ment of Title VII will be large: the pre-

paration of statistical proof in a complex

class action is already expensive, routine-

ly costing between $30,000 and $100,000; a

requirement that plaintiffs take every con-

ceivable factor into account in their

19/

showings, before the defendant is ever

19/ As the instant case demonstrates,

there is substantial danger that a court

of appeals may announce radically higher

standards by which plaintiffs' proof is to

be judged, apply the new standards long

after the record has been closed, and give

plaintiffs no opportunity to meet the new

standards. Cf. Albemarle Paper Co. v. Moody,

422 U.S. at 436, 45 L.Ed.2d at 30/, —

remanding the case for a new hearing in

light of the fact that the "appropriate

standard of proof" had "not been clarified

until today".

Without assurance of such an opportunity

to meet new and higher standards announced

for the first time on appeal, counsel for a

class would be gambling with their client's

interests to rely on the standards in effect

at the time of the trial. To safeguard

their case, they will have to produce every

conceivable type of proof. The effect on

(footnote cont'd)

= 24 @

required to explain anything, would dras-

tically reduce the ability of the private bar

and of civil rights organizations to take on

these actions. Because the government files

only a small percentage---generally less than

3%---of the Title VII cases brought each year

in the district courts, the enforcement and

promise of Title VII will suffer greatly.

2. The Fifth Circuit's Rejection of

Census Data as Proof of the Disparate

Impact of an Educational or Other

Requirement is in Conflict With the

Decisions of this Court

In Griggs v. Duke Power Co., 401 U.S.

at 430 n. 6, 28 L.Ed.2d at 163 n. 6,

this Court relied on Census statistics to

show the racially disparate impact of the educa-

tional requirement at issue there. Plaintiffs

here relied on the identical type of statis-

tics. Supra at 16 n. 10. In Dothard v.

(footnote cont'd)

trial time, and the added complexity of future

cases, are unfortunate side effects to the

need to protect the class.

= 92 «

Rawlinson, 433 U.S. 321, 330-31, 53 L.Ed.2d

786, 798 (1977), this Court relied on nation-

wide Census data to show the sexually dis-

parate impact of a minimum-height requirement,

and rejected the employer's claim that dis-

parate impact could be determined only on the

basis of data on actual applicants. Here,

plaintiffs have also shown the effect of

educational requirements on black applicants

at MSES. Supra atl7nn. 1l, 12. Here, the

trial court even took judicial notice of its

own prior finding of the disparate impact

(and lack of business necessity) for one of

the most important educational requirements

at issue. (App. 143a-145a).

The Fifth Circuit gave no reason for

its rejection of these binding standards in

the case at bar.

= 33 -

3. Allowing a Defendant's Unsupported

Speculation to Defeat Showings of

Discrimination Based on Statistics

and Other Proof Conflicts With the

Decisions of This Court and of

Other Circuits

The common thread running through much

of the Fifth Circuit's decision is that the

Court each time rejected plaintiffs' showings

on the basis of MSES's mere conjecture that

something else might account for the racial

and sexual disparities shown. There is not

a shred of evidence that inclusion of any

such factor would actually have made a dif-

ference in any cf these showings.

The lower court's approach is in con-

flict with the decisions of this Court and

of the other courts of appeals, rejecting

the notion that plaintiffs' initial statis-

tical showings must be universal and:perfect

before they shift the burdens of production

and of persuasion to the defendants. In

Dothard, this Court held:

- 34 -

The plaintiffs in a case such as this

are not required to exhaust every

possible source of evidence, if the

evidence actually presented on its

face conspicuously demonstrates a

job requirement's grossly discri-

minatory impact. If the employer

discerns fallacies or deficiencies

in the data offered by the plaintiff,

he is free to adduce countervailing

evidence of his own.

433 U.S. at 331, 53 L.Ed.2d at 798. In Int'l

Bhd. of Teamsters v. United States, 43l U.S.

324, 340, 52 L.Ed.2d 396, 418 (1977), this

Court noted that statistical proof offered by

a Title VII plaintiff was subject to rebuttal;

the Court did not hold that conjectural

problems would prevent plaintiffs from ever

making out a case sufficient to shift the

burden to the defendant. Plaintiffs are not

required to engage in "fine tuning of the

statistics". 431 U.S. at 342 n. 23,

52 L.Ed.2d at 419 n. 23.

The other courts of appeals have con-

sistently rejected the approach which the

Fifth Circuit chose to follow here. In

- 35 -

Grant v. Bethlehem Steel Corp., 635 F.2d 1007,

1015 (2nd Cir., 1980), cert. den., 452 U.S. 940,

69 L.Ed.2da 954 (1981), the court rejected the

contention that "evidence of some weaknesses

in the statistics" meant that they should be

rejected. In United States v. County of

Fairfax, Virginia, 629 F.2d 932, 940 (4th Cir.,

1980), cert. den., 449 U.S. 1078, 66 L.Ed.2d

801 (1981), the court a iacitas the claim that

applicant-flow figures were suspect because

an affirmative action plan might have led un-

qualified women and blacks to apply in dis-

proportionately large numbers:

We cannot assume that blacks and women

attracted by an affirmative action

plan are more likely to be unqualified

than white males who apply. If such

is the case, this possible defect in

the statistics is a factual matter to

be proved by defendants in rebuttal

of the government's prima facie case;

it is not a factor which determines

if a prima facie case has been proved.

In Davis v. Califano, 613 F.2d 957, 964

= 36 -

(D.C. Cir., 1979), the court held that plain-

tiffs' initial statistical presentation need

not include “every conceivable factor relevant

to a promotion decision", but only the minimum

objective qualifications:

The defending party, with the greater

access to statistical evidence of

other relevant factors, may utilize

such evidence in its rebuttal presenta-

tion. (Footnote omitted).

Again, the Fifth Circuit gave no reason

for its departure from these settled standards.

CONCLUSION

The petition should be granted and the

decision of the Fifth Circuit should be

vacated and remanded, with instructions that

the court of appeals reconsider its decision

in light of Griggs, Octhard, and Teamsters,

that it not reject otherwise competent

statistical proof on the basis of mere

= 37 «

conjecture, and that it decide all issues

presented.

Respectfuliy submitted,

William L. Robinson

Richard T. Seymour *

Lawyers' Committee for

Civil Rights Under Law

520 Woodward BUilding

733 Fifteenth Street, N.W.

Washington, D.C. 20005

Nausead Stewart

Lawyers' Committee for

Civil Rights Under Law

720 Milner Building

210 South Lamar Street

Jackson, Mississippi 39201

Attorneys for Petitioners

*Counsel of Record

July 1983

APPENDIX

Contents of Appendix

April 29, 1983 Order of the United

States Court of Appeals for the

Fifth Circuit denying the Peti-

tions for Rehearing and the

Suggestion for Rehearing En Banc

March 11, 1983 Decision of the

United States Court of Appeals

for the Fifth Circuit

March 7, 1980 Memorandum of Decision

of the United States District

Court for the Northern District

of Mississippi

March 7, 1980 Final Judgment of the

United States District Court for

the Northern District of

Mississippi

Page

la

3a

66a

15la

- la-

UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

ROSIE LEE PEGUES, et al.,

Plaintiffs-Appellants,

Ve

MISSISSIPPI STATE EMPLOYMENT SERVICE,

et al.,

Defendants~Appellees.

No. 80-3212

(April 29, 1983)

Appeal from the United States

District Court for the Northern

District of Mississippi

On Petition for Rehearing and

Suggestion for Rehearing En Banc

Before WISDOM, POLITZ, and TATE, Circuit

Judges.

PER CURIAM:

The Petitions for Rehearing are DENIED

and no member of this panel nor Judge in

regular active service on the Court having

requested that the Court be polled on rehear-

ing en banc, (Rule 35 Federal Rules of

Appellate Procedure; Local Fifth Circuit Rule

- 2a -

16) the Suggestion for Rehearing En Banc is

DENIED.

ENTERED FOR THE COURT: HENRY A. POLITZ,

United States Circuit Judge

- 3a -

UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

ROSIE LEE PEGUES, et al.,

Plaintiffs-Appellants,

Vv.

MISSISSIPPI STATE EMPLOYMENT SERVICE

et al.,

Defendants-Appellees.

No. 80-3212

699 F.2d 760 (March 1l, 1983)

Appeal from the United States

District Court for the Northern

District of Mississippi

Before WISDOM, POLITZ and TATE, Circuit

Judges.

POLITZ, Circuit Judge:

Rosie Lee Pegues, Rebecca Gillespie,

Mary Boyd and Robert Williams, residents of

Bolivar County, Mississippi, brought suit

against the Mississippi State Employment

Service (MSES), John E. Aldridge, Ernest

C. Lindsey, the United States Secretary of

Labor, the United States Department of Labor

and its division, the United States Employment

- 4a -

Service (USES), contending that the defendants

engaged in individual and classwide discrimi-

nation in violation of Title VII of the Civil

Rights Act of 1964, 42 U.S.C. § 2000e, et seq.

42 U.S.C. §§ 1981 and 1983 and the thirteenth

and fourteenth amendments to the Constitution.

The named plaintiffs represent a class of

black and female applicants who have sought

or who may hereafter seek job referrals from

MSES's Bolivar County office located in

Cleveland, Mississippi. After an extended

bench trial, the court entered judgments dis-

missing both the individual and class action

Title VII claims. Pegues v. Mississippi State

Employment Serv., 488 F.Supp. 239 (N.D.Miss.

1. Claims for alternative remedies for employ-

ment discrimination under 42 U.S.C. §§ 1981, 1983,

and the constitutional amendments will be considered

only if violations can be established on grounds dif-

ferent from those asserted under Title VII. Plaintiffs

cite no such distinctions. We thus address only the

Title VII claims. See Rivera v. City of Wichita Falls,

665 F.2d 531 (5th Cir., 1982).

- Sa -

1980). Plaintiffs raise a plethora of issues

on appeal, assigning errors of fact and law

to the final judgment and two intermediate

rulings. We affirm in part, reverse in part,

render and remand for the fashioning of an

appropriate remedy.

Procedural History

Following receipt of the requisite right-

to-sue letters from the Equal Employment

Opportunity Commission in January 1972, plain-

tiffs filed suit against the state defendants

charging the MSES Cleveland office with dis-

crimination in the classification, referral,

and testing of black and female applicants

for employment referral within the Bolivar

County labor market. Plaintiffs charged

racial and sexual discrimination in: (1) the

assignment of occupational classifications to

blacks and females; (2) the acceptance and

servicing of certain employer job orders; (3)

the administration of employment tests to

- 6a°-

blacks; (4) the failure to refer blacks and

females to available jobs; and (5) the refer-

ral of blacks and females to lower paying and

less desirable jobs.

The federal defendants were joined as

indispensable parties under Fed.R.Civ.P. 19(a).

57 F.R.D. 102 (N.D.Miss.1972). An amended

complaint filed thereafter alleged a statewide

class, and attacked regulations and guide-

lines promulgated by the Secretary of Labor

which purportedly allowed MSES to discri-

minatorily classify and refer applicants, and

allegedly required MSES to use employment

tests developed by USES which eine kl

tionately impacted against blacks. The

2. Plaintiffs' Title VII claims against the

state and federal defendants rest on Section 703(b)

of the Civil Rights Act of 1964, as amended, 42 U.S.C.

§ 2000e-2(b). This provision prohibits an employ-

ment agency, as defined in Section 70l(c), 42 U.S.C.

§ 2000e(c), from failing or refusing to "refer for

employment, or to otherwise discriminate 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."

-Ja-

state defendants cross-claimed, seeking in-

demnity from the federal defendants for any

adverse money judgment based on their compli-

ance with federally-mandated policies and pro-

BS? ett

A motion by plaintiffs requesting certi-

fication of a statewide class of blacks and

females seeking referral from all state MSES

offices, filed in 1974, was finally heard in

February 1978. The court certified a class

confined to persons seeking job referrals

3. MSES, a division of the Mississippi Employ-

ment Security Commission, is a member of the

national network of state employment services

established by the Wagner-Peyser Act, 29 U.S.C. §§ 49

through 49K. Under the Act, federal funds in the

form of grants covering operational costs are dis~

pensed by USES to state employment services. Parti-

cipating state services must adhere to USES policies

and procedures, Espinoza v. Stokely-Van , inc.,

64] F.2d 535 (7th Cir.), cert. denied, 453 U.S. 950,

102 $.Ct. 27, 69 L.Ed.2a 1033 (19861), including those

governing the classification, referral and testing of

applicants. 20C.F.R. §§ 653.1-653.13 (1982). During

the relevant period many of these policies and pro-

cedures were set forth in the federal Employment

Security Manual, a U.S. Department of Labor publica-

tion.

- 8a -

from the Bolivar County MSES branch.

In March 1978, the district court

granted the federal defendants' motion for

4

summary judgment, ruling, inter alia, that

the 1972 amendments to Title VII barred

imposition of liability upon USES in the

event classification, referral or testing

functions performed by MSES under federal

supervision were adjudged illegal. Because

of the dual possibility that plenary

4. Summary judgment was rendered in favor of

the federal defendants on all claims asserted, the

court having determined that: (1) Congress' amission

of USES from the 1972 amendments to Title VII, Sec-

tion 70l(c), 42 U.S.C. § 2000e(c), as amended, mani-

fested an intent to exonerate this entity from all

potential claims of employment discrimination except

those authorized under Section 717, 42 U.S.C.

§ 2000e-16; (2) plaintiffs had failed to exhaust

their administrative remedies as a prelude to asser-

tion of their Title VI claims, 42 U.S.C. § 2000d; (3)

the United States was immune from suit under 42 U.S.C.

§ 1981 and the thirteenth amendment; (4) no allega-

tion of intentional discrimination had been raised,

pretermitting maintenance of a cause of action under

the fifth amendment; and (5) no private right of ac-

tion against the federal government could be implied

from the terms of the Wagner-Peyser Act, as amended,

49 U.S.C. § 49-49k. Only the first determination is

Challenged on appeal.

- 9a -

injunctive relief could not be secured from

the state defendants in the Secretary's ab-

sence, and the state might be entitled to

indemnity should back-pay or attorneys’ fees

be assessed against it, the court declined to

dismiss the state's cross-claim.

On appeal, plaintiffs challenge the dis-

trict court's conclusion that referral of job

applicants by the MSES office was free of

race and gender discrimination. They further

argue that the court erred in finding that

employment tests administered by the Cleveland

office were job-validated and did not impact

adversely on black applicants. Plaintiffs

challenge the court's admission of expert

testimony on test validation, grant of sum-

mary judgment in favor of the federal defend-

ants on the basis of the 1972 amendments to

section 70l(c), 42 U.S.C. § 2000e(c), and

refusal to certify a statewide class.

Limitation of the Class

Plaintiffs sought certification of

- 10a -

a statewide class and the intervention of

persons complaining of practices in MSES of-

fices throughout the state. Finding the

request untimely and concluding that a state-

wide class was unwieldy and unnecessary, the

district/court limited the class to Bolivar

County and denied intervention. Appellate

review of this ruling is governed by an abuse

of discretion standard. Payne v. Travenol

Laboratories, Inc., 673 F.2d 798 (5th Cir.),

reh'g denied, 683 F.2d 417 (5th Cir.), cert.

denied, U.S. , 103 S.Ct. 452, 74 L.Ed.2d

(1982). Implicit in this deferential

standard of review is the recognition of the

essential factual nature of the certification

inguiry and the district court's inherent

power to manage and control pending litiga-

tion. When measured against this standard,

we are not prepared to say that the district

court's effort to efficiently manage this

complex litigation constituted an abuse of

- lla -

discretion. See McGowan v. Faulkner Concrete

Pipe Co., 659 F.2d 554 (5th Cir. 1981).

Class Claims

A Title VII class action may be

brought under two theories: disparate treat-

ment or disparate impact. Either theory may

prove applicable to the same set of facts.

Wheeler v. City of Columbus, Miss.,

686 F.2d 1144 (5th Cir. 1982). In a dis-

parate treatment case the plaintiff class

must prove the existence of a pattern and

practice of race or gender-based discrimi-

nation. See International Brotherhood of

Teamsters v. United States, 431 U.S. 324,

97 S.Ct. 1843, 52 L.Ed.2d 396 (1977). Dis-

criminatory intent must be established, by

either direct or circumstantial evidence.

Wheeler v. City of Columbus, Miss. Facially

neutral practices which impact more severely

on one group than another are subject to

attack under the disparate impact theory.

- l2a -

Dothard v. Rawlinson, 433 U.S. 321, 97 S.Ct.

2720, 53 L.Ed.2d 786 (1977); International

Brotherhood of Teamsters v. United States.

Proof of discriminatory purpose is not re-

quired in a disparate impact case.

Plaintiffs charge the MSES Cleveland

office with racial and sexual discrimination

in three practices: assignment of occupa-

tional codes, referrals, and ciate All

three practices allegedly impacted in a sig-

nificantly adverse manner upon black and fe-

male applicants. Plaintiffs' cast their evi-

dence as to each practice in the disparate

impact model. However, we conclude that only

the testing issue fits within this eviden-

tiary framework.

A brief description of the operation of

5. Evidence bearing on the interrelationship

of the federal and state defendants was directed ex-

clusively to the testing issue. Our analysis of the

federal defendants' liability is thus circumscribed

by the issue as joined and the evidence adduced.

- l3a -

the Cleveland office during the relevant

period will assist in focusing the plaintiffs'

Class claims. This office, like all other

MSES branch offices in Mississippi, functioned

as a labor exchange, matching qualified appli-

cants with available jobs. Employers make

known openings by placing "job orders." Ap-

plicants make known their availability by

requesting job referrals. The Cleveland

office accounted for approximately 25% of all

new hires in the Bolivar County labor market.

On the initial visit, each applicant was

given an application form, questioned as to

job preferences and directed to the inter-

viewer who handled job codes corresponding

to the preferences expressed. Until 1978,

job codes were six-digit numbers represent-

ing a specific family of jobs in the federal

Dictionary of Occupational Titles (DOT), a

6

Department of Labor publication.

6. A specific six-digit numerical code (nine

(footnote continued)

- l4a -

(footnote continued)

digits since 1978) was assigned to each of the 20,000

job definitions incorporated in the DOT. These

codes are organized into the following broad occupa-

tional categories, or families, symbolized by a

single digit:

OCCUPATIONAL CATEGORIES

0/1 Professional, technical, and managerial occupa-

tions

Clerical and sales occupations

Service occupations

Agricultural, fishery, forestry, and related

occupations

Processing occupations

Machine trades occupations

Benchwork occupations

Structural work occupations

Miscellaneous occupations

& WwW dN

oon au

Subsumed within the nine major job families are

more than 82 diverse, two-digit divisions. The

families of particular importance in this case, the

clerical and sales, service, and agricultural codes,

are subdivided into a variety of occupations:

CLERICAL AND SALES OCCUPATIONS

20 Stenography, typing, filing, and related occupa-

tions

21 Camputing and account-recording occupations

22 Production and stock clerks and related

occupations

23 Information and message distribution occupa-

tions

24 Misce. Laneous clerical occupations

25 Sales occupations, services

26 Sales occupations, consumable commodities

27 Sales occupations, commodities, n.e.c.

29 Miscellaneous sales occupations

(footnote continued)

- l5a -

(footnote continued)

SERVICE OCCUPATIONS

30 Domestic service occupations

31 Food and beverage preparation and service occu-

pations

32 Lodging and related service occupations

33 Barbering, cosmetology, and related service

occupations

34 Amusement and recreation service occupations

35 Miscellaneous personal service occupations

36 Apparel and furnishings service occupations

37 Protective service occupations

38 Building and related service occupations

AGRICULTURAL, FISHERY, FORESTRY AND

RELATED OCCUPATIONS

40 Plant farming occupations

41 Animal farming occupations

42 Miscellaneous agricultural and related occupa-

tions

44 Fishery and related occupations

45 Forestry occupations

46 Hunting, trapping and related occupations

These subdivisions are in turn broken down into

specialized fields. For example, included within the

first division under the clerical and sales code,

stenography, typing, filing, and related occupations,

are:

201 Secretaries

202 Stenographers

203 Typists and typewriting-machine operators

205 Interviewing clerks

206 File clerks

207 Duplicating-machine operators and tenders

208 Mailing and miscellaneous office machine

Operators

- l6a -

Once routed to the appropriate interview-

er, the applicant was assisted in completing

the application form, and questioned about

education, vocational training, work experi-

ence, skills, work preferences, and personal

interests and characteristics. Based on this

information, the interviewer selected and

inscribed the appropriate DOT code on the

application. Work experience was a primary

consideration in the coding process, although

other factors were weighed, including the

types of employment available in the area.

The code issued an applicant who was not fully

qualified, lacked the requisite experience, or

needed further training, included an "x."

The interviewer's duties included the

processing of employer job orders. A typical

order contained information from the employer

concerning the job, the number of vacancies,

the desired number of referrals per vacancy,

and the education and experience thresholds

required. Interviewers had authority to

- l7va-

determine whether any educational and experi-

ential criterion was sufficiently job-related,

and if not, whether further investigation was

necessary before the job order was processed.

Interviewers were encouraged to dissuade

employers from imposing arbitrary hiring re-

quirements, and job orders discriminating on

the basis of sex or race were not to be

serviced by MSES personnel. After obtaining

the necessary information, the interviewer

coded each job vacancy listed in the job

order.

The matching and referral decision was

facilitated by tests designed to ascertain

job capabilities. In the absence of a suf-

ficient number of applicants with a code

identical to a job order, applicants with

codes within the occupational family were

referred. The discretion of the interviewer

was unavoidably involved in this process.

Plaintiffs introduced extensive

- 18a -

documentary and testimonial evidence designed

to show that the state defendants discrimi-

nated in the classification and ref srral of

blacks and women, contrary to federally pre-

scribed policies. Implicit in this claim is

the contention that the interviewers abused

their discretion in coding and referring.

Plaintiffs also endeavored to prove that the

battery of tests, albeit uniformly adminis-

tered without regard to race, operated dis-

proportionately to exclude blacks.

Because the classification and referral

practices complained of effectively turn on

discretionary decisions, they do not fall

within the category of facially neutral pro-

cedures to which the disparate impact model

is traditionally applied. Pouncy v. Pru-

dential Ins. Co. of America, 668 F.2d 795

(Sth Cir. 1982); C. Sullivan,M. Zimmer and

R. Richards, Federal Statutory Law of Employ-

ment Discrimination, § 1.5(c) (1980).

- 19a -

Selection processes which rely on subjective

judgments, despite the corraling by objective

standards, provide the opportunity for the

intentional discrimination cognizable ina

disparate treatment action. See Payne v.

Travenol Laboratories, Inc. We must there-

fore analyze plaintiffs' challenge to the

classification and referral systems under

the disparate treatment modality. Their

challenge to the aptitude tests, generally

regarded as neutral selection mechanisms,

will be evaluated under the aegis of the

disparate impact theory.

I. CLASSIFICATION AND REFERRAL

As noted, we evaluate the classifi-

cation and referral claims under the dis-

parate treatment theory, which requires proof

of discriminatory animus. To prevail, plain-

tiffs must demonstrate more than "the mere

occurrence of isolated or 'accidental' or

sporadic discriminatory acts. [Rather they

- 20a -

must show] by a preponderance of the evidence

that discrimination was the [defendants']

standard operating procedure---the regular

rather than the unusual practice." Interna-

tional Brotherhood of Teamsters v. United

States, 431 U.S. at 336, 97 S.Ct. at 1854.

A prima facie case may be established by the

use of statistics if a sufficiently sub-

stantial, or "gross," disparity in the treat-

ment of the favored and disfavored groups can

be shown. Hazelwood School District v.

United States, 433 U.S. 299, 97 S.Ct. 2736,

53 L.Ed.2d 768 (1977). In such cases statis-

tical disparities, standing alone, may justi-

fy an inference of discriminatory motive.

International Brotherhood of Teamsters v.

United States; Payne v. Travenol Laboratories,

Inc. Moreover, as we stated in Payne:

The statistical showing of a dis-

parate result may also be but-

tressed with evidence of a history

of discrimination practiced by the

employer, individual instances of

discrimination, and opportunities

- 2la -

to discriminate that exist in the

employer's decision-making proc-

esses. If the statistical dis-

parity is insufficient alone to

establish a prima facie case, the

plaintiff may get over his or her

initial hurdle by combining statis-

tics with historical, individual,

or circumstantial evidence. (Cita-

tions omitted.)

673 F.2d at 817.

Should the plaintiff succeed in estab-

lishing a prima facie case, the defendant

may overcome the presumption of discrimina-

tion thus raised by discrediting the plain-

tiff's statistical evidence or by advancing

a nondiscriminatory rationale for what

appeared to be discriminatory conduct.

Wheeler v. City of Columbus, Miss.; Williams

v. New Orleans Steamship Ass'n, 673 F.2d 742

(Sth Cir.), reh'g denied, 688 F.2d 412 (5th

Cir. 1982). Affirmations of good faith

selection of the most qualified applicant

will not satisfy this burden. Failure by

defendants to rebut a prima facie case war-

rants the conclusion that Title VII haz been

- 22a -

violated.

Statistical evidence must be re-

garded with a substantial degree of caution.

See, New York Transit Auth. v. Beazer, 440

U.S. 568, 99 S.Ct. 1355, 59 L.Ed.2d 587

(1979); Pouncy v. Prudential Ins. Co. of

America. Although competent to prove employ-

ment discrimination, "statistics are not

irrefutable; they come in infinite variety

and, like any other kind of evidence, they

may be rebutted. In short, their usefulness

depends on all the surrounding facts and cir-

cumstances." International Brotherhood of

Teamsters v. United States, 431 U.S. at 340,

97 S.Ct. at 1856. We have repeatedly warned

of the need for considered and refined statis-

tical analysis in the context of Title VII

Class actions. Pouncy v. Prudential Ins. Co.

of America; Rivera v. City of Wichita Falls;

Wilkins v. University of Houston, 654 F.2d

388 (5th Cir. 1981), vacated and remanded,

- 23a -

U.S. >» £83: 8.Ce. 34, 76 Lb. Ba.. 26: SF

(1982), af£'d on remand, 695 F.2d 134 (5th

Cir. 1983).

Discrimination in Classification

Plaintiffs presented quantitative

evidence of the disproportionate classifica-

tion of blacks and women in stereotypic, less

remunerative occupations during selected

years between 1970 and 1976. No testimony,

lay or expert, was offered to explain the

significance of this data, nor was an appro-

priate test of statistical significance

applied. Evidence of individual instances

of discriminatory treatment of blacks and

women during the classification process, and

of the state defendants' noncompliance with

federal directives, was also introduced.

Without indicating whether such evidence,

in the aggregate, sufficed to make out a

prima facie case of discrimination, the dis-

trict court concluded that plaintiffs had

- 24a -

failed to sustain their ultimate burden of

7

proof under an impact theory.

7. There are no findings or conclusions set

forth in the district court's opinion to support its

rejection of plaintiffs' classification and referral

Claims, other than a detailed recitation of federal

policies and regulations governing MSES's classifi-

cation and referral functions, a discussion of the

limited role of the Cleveland office in placing

applicants, and general efforts made by MSES staff

to obey the civil rights laws, the excellent relation-

ship between the Cleveland office and the black

community, and a conclusionary statement that the

state defendants had at all times sought to classify

and refer applicants without regard to race or sex.

It is nonetheless clear, from the court's extensive

and somewhat laudatory exposition of defendants'

case, that it did not deem plaintiffs' evidence to

be either credible or probative of discrimination.

488 F.Supp. at 243. Handicapped though we are by

the dearth of specific factual findings, we proceed,

in light of the recent death of the trial judge and

the substantial passage of time since the inception

of the lawsuit, to decide this case in the interests

of justice and judicial economy. See Felder v.

United States, 543 F.2d 657 (9th Cir. 1976).

Cognizant of the preferred practice of remand,

we are loathe to returm this voluminous record,

including thousands of pages of testimony and myriad

exhibits, to another trial judge for a transcript

review. We may perform that function under circum

stances as here presented, particularly since we

find that the record is susceptible of only one

resolution of the factual issues presented. United

States v. Georgia Power Co., 695 F.2d 890 (5th Cir.

1983).

- 25a -

Several charts were offered to show a

disproportionate classification of blacks in

codes for less desirable service occupations,

and of women in lower paying jobs. These

exhibits reflect imbalances, but do not show

that race or sex, rather than work prefer-

ences, exverience, education, and the state

of the job market caused the imbalances. As

thus presented, these figures are of little

probative value. D. Baldus & J. Cole, Sta-

tistical Proof of Discrimination, § 1.22[23]

(1980).

At first glance, two related series of

exhibits focusing on race in the classifica-

tion of persons of equivalent education

appear illuminating. Upon closer examina-

tion, the probative value dims.

In the first series, one exhibit sat

flected that in 1970, 90 black women and one

white woman, all with at least eight years

of education, were coded for domestic labor. Other

- 26a -

exhibits portrayed a continuation of this

trend, to a lesser degree, in 1972, 1974 and

1976. Work preferences were identified for

1970 only; of the 44 coded as maids that year,

28 opted for non-domestic work. There was no

analysis of this data and no quantification

of the white women in the pool who received

more desirable codes. The records do not

show job preferences for 1972, 1974 and 1976,

an omission which detracts from the weight of

the figures and militates against any meaning-

ful comparison of the races.

The second series of exhibits, organized

according to educational levels, contrast

black and white classifications for the year

1974. One exhibit reveals that 265 black

women with an elementary school education,

constituting 2/3 of the females in this

category who applied in 1974, were coded for

service occupations, while only 16 white

women were similarly coded. Twelve black

- 2/a -

and 9 white women in this cross-seczion of

1974 applicants were assigned the clerical

and sales code characteristically dominated

by whites; 2 black and 0 white women were

assigned codes within the professional,

managerial and technical category. Past ex-

perience, work preference, and the availa-

bility of alternate jobs at the time of in-

terviewing, information which is contained

in the record, were not compiled or consid-

ered by the plaintiffs. Nor were the figures

subjected to statistical analysis.

The same comparative analysis was em-

ployed with respect to the classification,

in 1974, of black and white men with no more

than a seventh grade education. Again, such

critical variables as epxerience, work pre-

ference and jobs available at the time each

applicant was interviewed were not incor-

porated in the data, nor was statistical

methodology utilized to discount the

- 28a -

possibility that apparent racial discrep-

ancies were not due to random selection.

Substantial disparities in the assign-

ment of service or farmwork codes to black

and white men with an education at or above

the eighth grade level were also shown pur-

Ssuant to this analysis. Occupational prefer-

ences and job availability were again omit-

ted. Work histories, although measured by

the data, were widely divergent. No statis-

tical test of significance was used to

evaluate these disparities.

In the final series of exhibits, raw

data in the form of seven charts, each of

which lists the name, education, work prefer-

ence and experience of applicants of a spe-

cific race/sex group, together with the

codes assigned in the years 1970 and 1974,

were offered. Plaintiffs produced no evi-

dence which explained or collated this data

for purposes of comparison between favored

- 29a -

and disfavored groups. The particular vari-

ant or variants to be compared among such

groups was not disclosed. Scrutinizing these

charts for differences in the classification

of similarly qualified blacks and whites, or

males and females, within a certain code,

discloses that there is no indication of the

size of the total applicant pool and the

porportion thereof of each group. None of

the recoy ized tests of statistical signifi-

cance were performed in an attempt to demon-

strate the unlikelihood that differential

coding could be ascribed to chance rather

than race or gender.

Reasoned assessment of disparities in

Classification of blacks and females evinced

in these exhibits thus cannot be made.

While precise calculations of statistical

Significance are not essential to statisti-

cal proof, Hazelwood School District v.

United States, no valid conclusions

- 30a -

regarding the relationship of observed selec-

tion patterns to the defendants' behavior

can be drawn absent some minimal framework

for analysis. Plaintiffs bear this burden.

See Rivera v. City of Wichita Falls; Vuyanich

v. Republic Nat'l Bank of Dallas, 505 F.Supp.

224, 234 (N.D.Tex. 1980); A. Smith and T.

Abram, Quantitative Analysis and Proof of

Employment Discrimination, 1981 U.I11.L.Rev.

33. Mindful though we are that simple com-

parisons of percentages are acceptable where

a strong inference of discrimination has pre-

viously been raised, Rivera v. City of

Wichita Falls, such is not the case here.

No pattern or practice of discriminatory

treatment is otherwise established by a

combination of plaintiffs' anecdotal and

statistical evidence. It is not for the

court, trial or appellate, to search the

voluminous record for data omitted from

plaintiffs' comparative analyses, compensate

- 3la-

for the failure to filter out the combined

effects of factors unrelaced to race or sex,

choose the appropriate statistical methodo-

logy, and insert therein select parts of the

array of figures presented. See Miller v.

Weber, 577 F.2d 75 (8th Cir. 1978). See

8

generally Wilkins v. University of Houston.

Discrimination in Referral

To establish a prima facie case of

discrimination against class members in re-

ferrals, plaintiffs offered statistics, bol-

stered by historical, anecdotal and circum-

stantial evidence, to demonstrate that de-

fendants disproportionately excluded quali-

fied black and female applicants from em-

ployment opportunities. This comparative

evidence was based on the assumption that all

persons with the same job code were similarly

8. Because we conclude that plaintiffs have

‘failed to make out a prima facie case, we need not

consider defendants' rebuttal evidence. See Pouncy

v. Prudential Ins. Co. of America.

- 32a -

qualified for a particular occupation.

Plaintiffs first took aim at defend-

ants' alleged practice of servicing discri-

minatory sexual preferences of employers.

They offered evidence of a pattern of

sexually segregated referrals to a major

local employer, Travenol Laboratories, during

the period December 1969 - May 1970. Women

were referred exclusively to lower paid

assembler jobs, and men to better paid

material handler jobs, in statistically sig-

nificant Ren Both were entry-level

positions, demanding no special skills or

training.

9. The statistical disparities in this example

approach the "inexorable zero" decried by the Supreme

Court in International Brotherhood of Teamsters,

431 U.S. at 342 n. 23, 97 S.Ct. at 1858 n. 23. Stand-

ard deviation analysis was applied to these dis-

parities to eliminate chance as a likely explanation

for the revealed underrepresentation. Hazelwood

School Dist. v. United States; Castaneda v. Partida,

430 U.S. 482, 97 S.Ct. 1272, 51 L.Bd.2d 498 (1977).

As defined in Castaneda, the standard deviation quanti-

fies the probability that chance is responsible for

(footnote continued)

- 33a -

(footnote continued)

any difference between an expected outcome and the

observed outcome in a sample comprised of a pro-

tected and nonprotected group (a binomial distribu-

tion). 430 U.S. at 496 n. 17, 97 S.Ct. at 1281 n. 7.

As the number of standard deviations increases, the

probability of chance as the cause of any difference

between the expected and observed results diminishes.

EEOC v. American Nat'l Bank, 652 F.2d 1176 (4th Cir.

1981), reh'g denied, 680 F.2d 965 (4th Cir.), cert

denied, —*U~S. , 103 S.Ct. 235, 74 L Ed.2d 186

1982). Generally speaking, in a sample equivalent in

size to that evaluated in Castaneda, a difference

between expected and observed values in excess of two

or three standard deviations at the 5% significance

level permits an inference of discrimination. See

Harrell v. Northern Elec. Co., 672 F.2d 444 (5th Cir.),

ied on reh'g, 9 F, lL (Sth Cir.), ouek.

denied, U.S. ,» 103 S.Ct. 449, 74 L.Ed. 2d

(1982).

In Harrell, 672 F.2d at 447 n. 5, we set forth

a formula for computing standard deviations based on the

Castaneda model. We delete therefrom the .5 correc-

tion factor used to compensate for Harrell's sample

size, and specially note a publication error in the

reproduction of the formula---the square root sign in

the denominator was omitted. The correct formula for

determining the number of standard deviations is:

w= X

~~ NPQ-

Tailored to the facts presented in the case at bar,

N = total number of applicants referred; P = percent-

age of female applicants; and Q = percentage of male

applicants.

Application of the formula to pla ntiffs' data

discloses that the difference between ti > expected

and the observed number of women referre:' to Travenol

(footrote continued)

- 34a -

These statistical disparities gain added

dimension when examined in the context of

evidence that the Cleveland office accepted

job orders in which the employer's gender

preference was expressed. Also relevant in

this regard are two admonitions issued by

the Department of Labor in June 1968 and May

1969, ordering the Cleveland branch to cease

the servicing of discriminatory employer sex

preferences, and to investigate the validity

of such vreferences and record the results.

(footnote continued)

Laboratories' material handler jobs exceeded 17 stand-

ard deviations. Expected versus observed numbers of

women referred to the female-dominated assembler jobs

differ by more than 13 standard deviations. Both

figures exceed the two or three standard deviations

considered sufficient to undermine chance as the

reason for the disparity.

Plaintiffs presented evidence of sex and race

segregated referrals during a 14-month interval com

mencing November 1969, but failed to draw the requi-

site comparison between favored and disfavored groups,

or to control for divergent qualifications possessed

by applicants within either group. Accordingly, this

evidence can at best be characterized as inconclusive,

and does not function to enhance plaintiffs' prima

facie showing.

= 35a *

The office did not investigate the suspect

job orders processed after receipt of the

Department of Labor's admonitions.

Plaintiffs also challenged defendants'

systematic referral of applicants to posi-

tions other than those for which they were

classified. \In 1970, of the 68 persons rem

ferred out-of+code to the more attractive

clerical and sales occupations, 58 were

white. Eight of these individuals were

overqualified ac ording to their assigned

code and may the efore be eliminated. In

contrast, only l black persons were simi-

larly a overqualified. Con-

versely, of the 68 applicants referred out-

of-code to less desirable service employ~

ment, 24 were white, three overqualified,

and 34 black. These categories are further

divided to show that 20 of the 21 white

women referred to service jobs were matched

with employers seeking waitresses, while 26

- 36a -

of the 34 black women receiving service refer-

rals were accorded opportunities for stereo-

typical domestic or cook positions.

Cognizant of the lessened probative

value of statistical evidence where the

sample size is small, due to the incremental

increase in the possibility of sampling error,

we must nonetheless guard against an overly

facile rejection of discrimination claims.

Two conflicting interests must be weighed:

the danger of prejudice to the defendant

posed by drawing inferences of discrimina-

tion from evidence consisting of a handful

of selection decisions, and the unfairness

to the Title VII claimant of imposing un-

attainable standards for proof of discrimi-

natory intent. EEOC v. American Nat'l Bank,

652 F.2€ 1176 (4th Cir. 1981), reh'g denied,

680 F.2d 965 (4th Cir.), cert. denied,

v8. » 103 8.Ct.. 235, 74. 4%. 86,26 286

(1982). Given our conclusion that a discri-

minatory pattern of sexually disparate

= 3%

referrals for a portion of 1970 has been de-

monstrated, we are satisfied that the evi-

dence bearing on out-of-code referrals may

properly serve to strengthen the prima facie

case of discriminatory Rema

Plaintiffs next assail the state de-

fendants' selection of applicants for re-

ferral on the basis of unvalidated educa-

tional requirements. As to the educational

requirements, plaintiffs rely upon charts

detailing what plaintiffs deem to be unreason-

able minimum education requirements of certain

employers for various job vacancies in 1970

and 1976, together with census data revealing

lower levels of education among blacks and

10. We have dete...ined that one of the named

plaintiffs, Rebecca Gillespie, proved an individual

claim of disparate treatment in the context of re-

ferral. See slip op. p. 2983, p. , infra. Under

the Teamsters analysis, this proof suggests a quali-

tative explanation for the prima facie showing here-

tofore made for 1970 on the basis of statistical and

historical evidence. See Phillips v. Jqint Legis-

lative Committee, 637 F.2d 1014 (5th Cir. 1981).

- 38a -

women in Mississippi. The lay witness who

compiled these charts acknowledged employing

her subjective judgment with respect to the

reasonableness of a given educational require-

ment. .A similar study on the experience re-

quirements was likewise based on this witness'

subjective determination of reasonableness.

these rudimentary analyses did not purport

to gauge the impact, in numerical terms,

upon black and female applicants in Bolivar

County by comparison with the appropriate

cross-section of the relevant labor market.

Absent proof of disparate impact, no invidi-

ous discrimination can be shown under the

disparate treatment theory. Pouncy v. Pru-

dential Ins. Co. of America; Rivera v.

City of Wichita Falls.

Pointing to evidence that a dispropor-

tionately smaller percentage of black men

and women were referred to available posi-

tions in 1970 than their concentration in

- 39a -

various referral pools (all applicants with

a code corresponding to that of the job to

which referrals were made) would justify,

plaintiffs employed the standard deviation

test approved in Castaneda v. Partida to

show that the difference between actual and

expected numbers of blacks referred was sta-

tistically significant. After painstaking

study of the record, we conclude that the

underlying data used to evaluate racial dis-

parities in referrals of black men and women

to clerical and sales occupations is so seri-

ously flawed as to negate plaintiffs' sug-

gestions of statistical significance.

The computational errors which undermine

the value of calculations pertaining to the

clerical and sales occupational codes are

not extant in the other eight codes. How-

ever, the calculations as to these eight are

not persuasive; they all fail to incorporate

the primary factor influencing referral---

- 40a -

experience. There is no basis in the record

for discounting the obvious significance of

this factor. Absent due consideration of

the experiential component of the referral

decision, plaintiffs' standard deviation

analyses furnish insufficient support for

the proposition that defendants' referral

decisions were tainted by racial bias.

Statistical evidence drawing compari-

sons between mean hourly rates of pay per

referral, and encompassing referrals to

occupations in all nine DOT code families.

from 1974 through 1978, was presented to

demonstrate that average wages for black and

female referrals were exceeded, in statisti-

cally significant proportions, by average

wages for white and male referrals. Based

on this data, plaintiffs' expert, Dr. Charles

Mann, testified that application of a "two-

tailed" test of significance, designed to

determine whether differences in the mean

- 4la -

hourly wages of black, white and female refer-

rals were statistically significant for the

years 1974-1978, produced positive results.

Dr. Mann's computations would appear to sup-

port an inference that the probability that

protected group members were referred, on

the average, to less remunerative employment

because of chance alone was extremely small.

Albeit impressive, Dr. Mann's computa-

tions do not take into account the relative

qualifications of persons referred during the

relevant period. The referral pools upon

which his analyses rest were not arranged so

as to eliminate those who were denied refer-

ral to better paying positions because of the

lack of necessary ability or skills. Pouncy

v. Prudential Ins. Co. of America; Rivera v.

City of Wichita Falls. Dr. Mann's model is

grounded on the unfounded assumption that

all persons were qualified for referral to

higher paid jobs.

- 42a -

A more meaningful analysis would have

compared minority and nonminority mean

salaries for referrals falling within a

single code family. This approach would

have disclosed whether black and female

applicants possessing education, experience

and skills equivalent to those of their

white and male co-applicants, were referred

in disproportionate numbers to lower paying

occupations. Because the raw data is

deficient for failing to recognize that "a

number of factors operate simultaneously to

influence the amount of salary" associated

with a particular referral, Wilkins v. Uni-

versity of Houston, 654 F.2d at 402, the

findings of statistically significant dis-

parities derived therefrom will not permit

ll

an inference of discrimination.

ll. Plaintiffs concentrated much of their

effort at trial on statewide data covering an un-

defined period culminating in March 1976, purported-

ly showing strong racial and gender disparities in

(footnote continued)

- 43a -

Plaintiffs contend that statistically

significant discrepancies in the frequency

of referrals for whites and blacks during

the years 1974 through 1978 has been estab-

lished. These data tell us nothing of the

relative qualifications of blacks and whites

in the available applicant pools, or of the

requirements imposed by the employers to

whom referrals were made. Factors other than

race may explain the variations in referral

rates observed. To conclude otherwise would

necessitate an impermissible degree of specu-

lation.

(footnote continued)

the pay rates of jobs to which referrals were made by

each of the 82 branch offices within the MSES system.

Dr. Mann testified, based on his performance of an

accepted statistical test, that such disparities

were statistically significant. Given our approval

of limitations imposed by the district court on the

scope of the class, such data has no relevance to

the practices of the Cleveland office. Since the

pertinent data have not been dissected out from those

relating to other offices, Dr. Mann's statewide

analyses are without probative value on the issues

posited in this litigation.

de

.

- 44a -

There remains for consideration plain-

tiffs' claim that discrimination pervaded de-

fendants' job development process, which en-

tailed MSES solicitation of employer job

orders on behalf of specific applicants for

whom the office had no suitable openings.

Job development could be undertaken for per-

sons who either possessed unusual skills or

training or who were difficult to place due

to the paucity of jobs they could perform. A

chart excerpting selected portions of defend-

ants' evidence shows that on various dates

during July 1974 through August 1978, the

local office's self appraisals indicated that

the percentage of black placements linked to

job development was lower than the percentage

of black applicants.

Plaintiffs’ failure to narrow the appli-

cant pool to those presumptively eligible for

participation in the job development process,

as above defined, prevents the comparison of

- 45a -

the number of blacks qualified tof job devel-

opment to the number receiving this service.

We are not unmindful that defendants’ reliance

on the subjective judgment of their interview-

ers in arriving at a decision on specific job

development casts doubt on the legitimacy of

the process, Payne v. Travenol Laboratories,

Inc., but are not persuaded that this element

of subjectivity overcomes the fundamental

def2ct in plaintiffs' figures. Standing

alone, therefore, these statistics have insuf-

ficient probative value.

Defendants' Rebuttal

Much of the state defendants' statisti-

cal evidence, introduced through their expert,

Dr. Linda Malone, was devoted to rebutting

Dr. Mann's calculntions of statistical evi-

dence. Her analyses related to applicant

rates of referral and mean salaries for the

years 1974 through 1978, and did not address

plaintiffs' prima facie proof of

- 46a -

discrimination in servicing of employer sex

preferences between November 1969 and mid-

1970, and out-of-code referrals in 1970.

Given our rejection of Dr. Mann's statistical

presentation and the restricted scope of de-

fendants' rebuttal statistics, we need not

review the probative value“of Dr. Malone's

studies.

This leads to our determination whether

defendants' remaining evidence, primarily

qualitative in nature, adequately counters

plaintiffs' prima facie showing. First, as

to evidence of sex-segregated referrals to

Travenol, defendants contend that they sub-

sequently terminated this practice. Second,

defendants claim that five of the 36 employer

gender preferences serviced by the Cleveland

office were patently reasonable. Notwith-

standing these assertions, the record con-

tains no explanation for the different treat-

ment accorded females and thus does not

- 47a -

shield the defendants from the consequences

of their discriminatory practice.

Pinally, defendants maintain that their

conduct cannot be scrutinized in a vacuum,

insisting that overwhelming evidence of their

good faith efforts to assist black and female

applicants within the confines of a depressed labor

market mitigates against a finding of discri-

mination. Any ostensible discrepancies in

the referral rates of members of the protected

classes must, in their view, be attributed

to the essentially rural character of the

area and the severe educational and experien-

tial deficiencies characteristic of Bolivar

County's predominantly black population.

We have no doubt that the poor socio-

economic conditions endemic to Bolivar County,

fostered in part by the displacement of black

agricultural workers following the mechaniza-

tion of farm labor in the 1960s, predeter-

mined work patterns in the area. MSES's

Cleveland office endeavored to cope with the

\

- 48a -

resultant influx of uneducated and unskilled

persons seeking employment by instituting

comprehensive job training programs and, in

the words of the district court, by doing

"what they could by way of classification

and referral to try to help the applicants

obtain whatever suitable work might be

available, without regard to ... race or

sex." 488 F.Supp. at 245. It is likewise

important to note that disparities in re-

ferrals of whites and blacks have been

steadily narrowing over the years. Payne v.

Travenol Laboratories, Inc.

Guided by Teamsters, however, we are not

persuaded that such affirmations of good

faith, coupled with evidence of improve-

ment in referrals of black applicants, over-

come plaintiffs' prima facie proof of sex

and race-based discrimination during 1969-70.

Accordingly, plaintiffs are entitled to judg-

ment on their claim of classwide sex

- 49a -

discrimination during the limited period for

which a pattern of disparate treatment was

established. This cause shall be remanded

for the fashioning of an appropriate remedy

for the infractions occurring during the

relevant 1969-70 period.

Discrimination in Testing

All MSES offices utilized certain

vocational aptitude tests, developed and

supplied to them by the Department of Labor

through the USES. Three forms of test bat-

teries are challenged: S-28 Tableworker,

S-270 and S-270R Licensed Practical Nurse,

and S-282 and S-282R Nurse Aide. Each of

these batteries, termed a Specific Aptitude

Test Battery (SATB), is comprised of two or

more aptitudes measured by the General Apti-

tude Test Battery (GATB). Binding prescrip-

tions for state agency use of the tests have

been promulgated by the Department of Labor,

and are set forth in Part II of the Employ-

ment Security Manual, Sections 9000-9999.

- 50a -

Since 1947, the Department of Labor has

distributed differing versions of the SATB

and GATB tests to the state employment serv-

ices. Throughout the ensuing years USES has

been engaged in research aimed at: validating

these tests for minorities. After the

Supreme Court's decision in Griggs v. Duke

Power Co., 401 U.S. 424, 91 S.Ct. 849,

28 L.Ed.2d 158 (1971), USES undertook a com-

prehensive revalidation program. An interim

policy was instituted in the fall of 1972 to

monitor state testing, pending completion of

the revalidation program. This policy

mandated the referral of minority group appli-

cants in "not less than the same ratio as the

minority group represented in the applicant

flow in the local office area, provided there

is a sufficient number of applicants who are

otherwise qualified, consistent with Federal

law." MSES' administration of S-28 was

- Sla -

governed by the interim policy until January

1973; the LPN and Nurse Aide tests were

thus regulated until the revalidation process

was completed in the mid-1970s.

Title VII permits the administra-

tion of "any professionally developed ability

test" on the condition that such test is not

utilized to discriminate against persons pro-

tected by the Civil Rights Act of 1964.

42 U.S.C. § 2000e-2(h). Dothard v. Rawlinson,

433 U.S. 321, 97 S.Ct. 2720, 53 L.Ed.2d 786

(1977); Albemarle Paper Co. v. Moody,

422 U.S. 405, 95 S.Ct. 2362, 45 L.Ed.2d 280

(1975). This selection technique must be

evaluated pursuant to the disparate impact

model. A plaintiff may establish a prima

12. Tests that have been differentially vali-

dated or which did not appear to significantly im

pact upon blacks in a discriminatory manner were re-

moved from the interim policy's strictures in January

1973. Although the S-28 Tableworker battery had last

been validated in 1954, it was considered by USES

to exert no adverse racial impact.

- 52a =

facie violation by demonstrating that a fa-

cially neutral examination exerts "a sig-

nificantly discriminatory impact." Connec-

ticut v. Teal, U.S. ¢- £92 B.S. 2oa05

2532, 73 L.Ed.2d 130 (1982).

If such an impact is demonstrated,

whether by statistics or other evidence, the

defendant is called upon to show that the

examination is job-related, or bears "'a mani-

fest relationship to the employment in ques-

tion.'" Id. (quoting from Griggs v. Duke

Power Co., 401 U.S. at 432, 91 S.Ct. at 854).

The proponent of the test must establish its

job performance validity. Ensley Branch of

the N.A.A.C.P. v. Seibels, 616 F.2d 812 (5th

Ld

Cir. 1980), cert. denied, 449 U.S. 1061, 101

S.Ct. 783, 784, 66 L.Ed.2d 603 (1981); Scott

v. City of Anniston, Alabama, 597 F.2d 897

(Sth Cir. 1979), cert. denied, 446 U.S. 917,

100 S.Ct. 1850, 64 L.Ed.2d 271 (1980). If

the defendant offers persuasive evidence, the

- 53a -

plaintiff may still prevail by proving that

the use of the test was merely pretextual,

Connecticut v. Teal, or that less discrimi-

natory alternatives existed. Albemarle Paper

Co. v. Moody.

To prove their claim that the Tablework-

er, Nurse Aide and LPN tests excluded dis-

proportionate numbers of blacks from referral,

plaintiffs introduced statistical evidence

comparing failure rates of white and black

applicants. The district court determined

that plaintiffs' proof did not establish a

prima facie case of disparate impact, due

principally to their mischaracterization of

certain scores. 488 F.Supp. at 253.

Looking first to the possible impact of

the S-28 examination, the pertinent data

reflect that in 1971, 13 whites and 32 blacks

scored "below norm." However, no perceptible

barriers to referral existed for recipients

of scores in the higher "below norm" range.

- 54a -

We thus lack a reliable statistical base

from which to assess the significance of the

observed disparity. See Connecticut v. Teal;

Albemarle Paper Co. v. Moody.

A different approach was adopted by

plaintiffs in an attempt to convince the

district court that blacks were test-selected

for referral to nurse's aide training at a

county hospital in disproportionately fewer

numbers than other applicants. From 1971

through 1976, 180 blacks (11.3%) and 278

persons of other racial or ethnic backgrounds,

primarily white (49.3%), all of whom were

classified under the nurse aide code, were

referred to the hospital's training program.

Application of the standard deviation formula

to these figures by plaintiffs' expert, Dr.

James Outzz, confirmed that the racial dif-

ference was statistically significant.

It is well settled that a plaintiff

need not establish the adverse impact of an

= 398 .-

aptitude test solely on the basis of compara-

tive pass/fail rates of blacks and whites,

but may proffer statistical proof of dif-

ferences in the proportions of blacks and

whites gaining entry to the desired employ-

ment opportunity. Hameed v. International

Ass'n of Bridge, Structural and Ornamental

Iron Workers, Local Union No. 396, 637 F.2d

506 (8th Cir. 1980); James v. Stockham Valves

and Fittings Co., 559 F.2d 310 (5th Cir.

1977); Watkins v. Scott Paper Co., 530 F.2d

1159 (5th Cir.), cert. denied, 429 U.S. 861,

97 S.Ct. 163, 50 L.Ed.2d 139 (1976). Notwith-

standing this rubric, the referral component

of the applicant pool must be tied to test

selection, the variable to be measured, be-

fore referral rates may be used as indicia

of failure.

| As the district court aptly observed,

Dr. Outzz had no knowledge of whom among

those referred had taken the nurse aide test.

- 36a -

Because the SATBs were developed to facili-

tate referral of inexperienced, untrained

and entry level workers to skilled positions,

they were not administered to experienced

applicants who had manifested some proficiency

in the occupation ebeicat™ > Information

identifying members of the applicant pool

tested, their scores, and their subsequent

referral or nonreferral was available to

plaintiffs, but was not collated. In light

of this critical omission, we decline to

infer from the opaque figures presented that

all applicants referred to nurse's aide

training were first required to take the

S-282.

13. Despite the district court's finding that

Rebecca Gillespie, an experienced nurse's aide, had

erroneously been required to undergo testing, there

was no evidence that other experienced candidates for

referral to the nurse aide training program, whether

white or black, were similarly treated. We therefore

attach no signifance to this isolated incident in

analyzing plaintiffs' classwide data pertaining to

nurse aide referrals.

- S/Ja-

A survey of S-270R scores of applicants

assigned the licensed practical nurse code in

the years 1970, 1972, 1974 and 1976, shows

that of the 66 persons completing the S-270R

battery, 13 of 29 blacks and 0 of 37 whites

received a failing score. Test performances

of 2 black and 2 white applicants are omitted.

One black woman, tested by another agency,

was referred to the county hospital for train-

ing. Plaintiffs describe the sample of appli-

cants tested at one point as composed of 75

persons; at another point they refer to 62

persons.

Since the outlines of the relevant

sample are imprecise, the majority and mi-

nority concentrations cannot be ascertained

as a prelude to application of probability

theory. Addition of the four persons for

whom no data is available further distorts

the figures. Where the sample size is small,

a few test scores may significantly skew the

overall disparity, thus reducing the

- 58a -

reliability of any inference which might be

drawn from minority "fail" rates.

While the small size of the sample does

not necessarily justify repudiation of plain-

tiffs' empirical analysis, we perceive none

of the evidentiary signals of discrimination

typically relied upon to bolster such analy-

ses. S. Booth and J. McKay, Legal Con-

straints on Testing and Evolving Trends in

The Law, 29 Emory L.J. 121, 157 (1980); see,

e.g., James v. Stockham Valves and Fittings

Co. Compare Rivera v. City of Wichita Falls

(14 of 35 Mexican-Americans who applied in

4-year period failed employment test, statis-

tically significant showings of adverse

impact alone deemed sufficient to make out

prima facie case); Wilkins v. University of

Houston (issue of applicability of statisti-

cal methodology to small number of positions,

14, not resolved inasmuch as diverse and

specialized credentials required).

- 59a -

Regardless of whether the injection of the

element of uncertainty attributable to the

size of the minority sample alone warrants

rejection of plaintiffs' data, we are conm-

pelled to the view that this factor, in con-

junction with the other problems above noted,

preclude a reasoned evaluation of this data.

We therefore perceive no prima facie case of

disparate impact resulting from the adminis-

tration of the S-270R test.

When viewed in the aggregate, the statis-

tical evidence supports the district court's

finding that the tests under consideration

were not discriminatory in their impact upon

black applicants. Absent proof that an

employment test exerts a substantially dis-

proportionate racial impact, no inquiry may

be undertaken into its job relatedness, or

validity. See Albemarle Paper Co. v. Moody;

Rivera v. City of Wichita Falls; Moore v.

Southwestern Bell Tel. Co., 593 F.2d 607

- 60a -

14

(Sth Cir. 1979).

Individual Claims

The four named plaintiffs, all of

whom are black, appeal the district court's

determination that they had not been discri-

minated against by the state defendants. In

order to establish a prima facie case of dis-

parate treatment, each plaintiff must prove:

(1) membership in a protected group; (2)

application and coding for an occupation for

which the Cleveland office was making refer-

rals; (3) failure to secure a referral; and

14. Because weaffirm the district court's de-

termination that the disputed tests produced no dis-

parate impact upon black referral candidates during

the years involved in plaintiffs' studies, we do not

address plaintiffs' averment that the state defend-

ants transgressed USES's interim policy in adminis-

tering the nurse aide and licensed practical nurse

examinations beginning in September 1972, or the

challenge to expert testimony on the job-validation

issue. Nor is it necessary for us to reach the

question whether the district court erred in con-

struing the 1972 amendment to Section 70l(c) of the

1964 Civil Rights Act, 42 U.S.C. § 2000e(c), to re-

lieve USES of putative liability for discriminatory

testing. The question remains for another day.

- 6la -

(4) later referral of a nonmember of the pro-

tected group. See Texas Department of Com-

munity Affairs v. Burdine, 450 U.S. 248,

101 S.Ct. 1089, 67 L.Ed.2d 207 (1981);

McDonnell-Douglas Corp. v. Green, 411 U.S. 792,

93 S.Ct. 1817, 36 L.Ed.2d 668 (1973). Upon

the plaintiff's establishment of a prima

facie case, the defendants are called upon to

dispel the presumption of discriminatory

treatment thus created by articulating a

legitimate, nondiscriminatory reason for the

particular plaintiff's treatment. If the

defendants come forward with such proof, the

plaintiff, who at all times retains the

burden of persuasion, may demonstrate that

the justification proffered by defendants was

a mere pretext designed to conceal discrimi-

nation. This goal may be achieved either by

proving that a discriminatory reason more

likely motivated the defendants’ action, or

by discrediting the defendants' articulated

- 62a -

explanation. Texas Department of Community

Affairs v. Burdine.

Applying the McDonnell-Douglas test, as

modified, to the district court's findings of

fact, 488 F.Supp. at 241-242, we conclude

that three of the named plaintiffs, Pegues,

Williams and Boyd, failed to adduce prima facie

proof of intentional TE instion. Al-

though we attach no significance to the in-

ability of plaintiffs to cite the referral of

any similarly or less qualified male and/or

white to positions to which they believe they

should have been referred, they were obli-

gated, at a minimum, to introduce evidence

attesting to the availability of a position

for which they were coded but were not

15. Consistent with Pullman-Standard v. Swint,

U.S. , 102 S.Ct. 1781, 72 L.Ed.2d 66 (1982),

we may reverse a district court's finding on the

question of discriminatory intent only if we are

satisfied that this finding is clearly erroneous.

Chaline v. KCOH, Inc., 693 F.2d 477 (5th Cir. 1982).

We are not prepared to say that the district court's

factual findings with respect to the claims of Pegues,

Williams and Boyd are clearly erroneous.

- 63a -

referred. See Harrell v. Northern Elec. Co.,

672 F.2d 444 (Sth Cir.), modified on reh'g,

679 F.2d 31 (5th Cir.), cert. denied, if #

, 103 S.Ct. 449, 74 L.Ed.2d (1982).

We discern no such evidence in the record.

As to Rebecca Gillespie, however, we

find that a prima facie case has been demon-

strated. Gillespie was a black female with

an eighth grade education and experience as

a waitress, maid and factory worker. She

first applied to the Cleveland office in

1968, and expressed a desire for anything

but domestic labor, including in particular

a job at Travenol Laboratories. Notwithstand-

ing her background and stated preference, she

was coded for service work. Upon earning a

10th grade GED certificate in July 1971, and

being aware of Travenol's educational cri-

terion, she advised the Cleveland office of

her achievement and repeated her request for

a factory referral. Her coding was not

- 64a -

re-evaluated in light of this pertinent

change in circumstances. Defendant Lindsey

testified that the office was still engaged

in referring applicants to Travenol at the

time of Gillespie's July 1971 visit. Al-

though not formally rejected, Gillespie was

passed over in favor of other, similarly

qualified applicants, some of whom were

white.

By way of rebuttal, defendants elicited

testimony from Gillespie as to her five full-

term pregnancies between 1970 and 1975, and

various benefits in the form of training and

referral that defendants had conferred upon

her between 1968 and 1970. The record re-

flects that at this time Travenol relied

exclusively upon MSES referrals to fill vacant

factory positions. Therefore, Gillespie could

not have secured a position without assist-

ance from the Cleveland office. Given her

factory experience and enhanced education,

- 65a -

we do not believe the reasons articulated con-

stitute a legitimate rationale for defendants'

failure to reconsider her service classifica-

tion and provide an opportunity for employ-

ment at Travenol. She is entitled to relief.

Conclusion

We conclude that plaintiffs succeeded in

establishing a pattern and practice of race

and sex-based disparate treatment during

1969 and 1970. We further conclude that

Rebecca Gillespie has sufficiently proven

her individual claim of discrimination. We

render judgment accordingly, thus modifying

the decision of the district court which, in

all other respects, is affirmed. We remand

for entry of a decree on liability in accord-

ance herewith, and for further proceedings

as may be deemed necessary for the fashion-

ing of an appropriate remedy.

AFFIRMED in part, REVERSED in part, and

REMANDED.

- 66a -

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF MISSISSIPPI

DELTA DIVISION

ROSIE LEE PEGUES, et al.,;

Plaintiffs,

Vv.

MISSISSIPPI STATE EMPLOYMENT SERVICE,

et OL.»

Defendants.

488 F.Supp. 239 (March 7, 1980)

MEMORANDUM OF DECISION

ORMA R. SMITH, District Judge:

This action has been submitted to the

court for decision after a fourteen-day

trial on the merits in which all parties

participated.

The court has received the memoranda of

the parties and post-trial proposed findin:;«

of fact and conclusions of law. After a

careful study of the evidence presented, the

court has concluded for the reasons herein-

after given, that plaintiffs cannot prevail

and the complaint must be dismissed.

- 6/a -

I. The Parties

The plaintiffs, Rosie Lee Pegues,

Rebecca Gillespie, Mary Boyd and Robert

Williams are members of the black race. They

reside in or near Bolivar County, Mississippi,

and were job applicants at the Bolivar County

or Cleveland, Mississippi local office (here-

after sometimes referred to as the "Cleveland

MSES office", or the "Cleveland office") of

the Mississippi State Employment Service

(MSES). They have been permitted to prosecute

a class action for the benefit of all black

and female job applicants at the Cleveland

MSES office who have received or may receive

in the future, disparate treatment at the

hands of the personnel at that office.

The defendants are:

1. The Mississippi State Employment

Service (MSES), a division of the Mississippi

Employment Security Commission.

2. John E. Aldridge, a resident of

- 68a -

Hinds County, Mississippi. Mr. Aldridge was

the Executive Director of the Mississippi

Employment Security Commission from July 16,

1960, until his retirement at the end of

February 1978.

3. Ernest C. Lindsey, a resident of

Cleveland, Bolivar County, Mississippi. Mr.

Lindsey has been, and is presently, office

manager of the Cleveland MSES office, serving

in this capacity since November 1968.

4. The United States Secretary of Labor,

currently the Honorable Ray Marshall, a resi-

dent of Washington, D.C.

5. The United States Department of

Labor, represented herein by the Atlanta

Georgia office of the United States Employ-

ment Service (USES).

The Federal Defendants, that is to say

the Secretary of Labor, The Labor Department,

and USES, have been released from the suit

by prior order of the court except for their

- 69a -

role as defendants to the third-party com-

plaint of MSES, and other state defendants.

II. Jurisdiction

The action is predicated on Title VII of

‘the Civil Rights Act of 1964, 42 U.S.C.

§§ 2000e et seq.; 42 U.S.C. §§ 1981, 1983,

and the Thirteenth and Fourteenth Amendments

to the Constitution of the United States.

Jurisdiction is vested pursuant to 28 U.S.C.

§ 1343(3) and (4).

III. The Issues

The named plaintiffs contend that the

Cleveland MSES office discriminated against

them because of their race and sex in classi-

fying them for employment referrals and in

making referrals. Defendants Aldridge and

Lindsey are said to be personally liable to

plaintiffs and members of their class because

they knowingly participated in the action of

the Cleveland MSES office in its discrimina-

tery conduct.

- 70a -

The class represented by plaintiffs is

described as a class of black persons and

females who have sought, or in the future may

seek, employment opportunities through refer-

rals by the Cleveland MSES office and who

claim that they have been, or in the future

may be, the target of discrimination on the

basis of race or sex.

The State Defendants claim indemnity

from the Federal Defendants for any monetary

recovery for which the State Defendants are held

liable on account of back pay to plaintiffs

or class members, suit costs, etc., in the

event of an adverse judgment in the action.

The State Defendants also seek injunctive

relief from the Federal Defendants should the

same become appropriate.

IV. Plaintiffs' Evidence

A. The Named Plaintiffs

l. Rosie Lee Pegues did not appear

or testify at the trial of the case. Her

/

j

}

- 7la-

record [SD Exhibit 58] reveals that at the

time of the events upon which her Title VII

charge was based, she was forty-six years of

age. Her education was at the sixth grade

level. The "Adult Basic Learning Examina-

tion" administered to her revealed a reading

level of third grade, and math level of

fourth grade. Her previous work history was

in the field of farm work, maid, kitchen help,

and housecleaning. She had also worked five

months with the Headstart Program in Merigold,

Mississippi. On her application Form 5ll,

under "Type work preferred," she wrote she

was not willing to accept a job out of the

area. The 511 form reveals that she had been

referred to the STAR Program [Systematic

Training and Redevelopment) at Mound Bayou,

Mississippi, a program designed to provide

training to help remove employment barriers

from persons with low educational, training,

skill and experience levels. She participated

- 72a -

in the program, but the program was termi-

nated for lack of funds before it was

completed. There was also an entry of ter-

mination for "loss of interest" on status

charge notice dated December 4, 1969, in her

STAR file.

2. Rebecca Gillespie, at the time of

the events upon which her Title VII charge

was based, was twenty-eight years of age.

Her education was at the eighth grade level,

with tenth grade equivalency later achieved.

The "Adult Basic Learning Examination" ad-

ministered to her revealed a reading level of

fifth grade, and math level of fifth grade.

Her previous early work history was in a

factory for one year (Alabama Metal, Rose-

dale, Mississippi], and as a cook-helper with

the Headstart Program at Pace, Mississippi.

She later worked as a nurse aide. She, too,

had been referred to the STAR program to

assist in removing her employment barriers,

- 138 =

and participated in the program until it was

terminated. Before enrolling in that program,

she had been referred by MSES to a job at

Misceramic Tile, where she was not hired,

and at the Bar B Q House, where she was hired,

and worked for three days. September 26,

1969, counseling insert form shows "Main-

stream [MDTA] for nurse aid when slot

develops." During the time when this appli-

cant was seeking employment through the

Cleveland MSES office (1968 - 1975) she

completed five full term pregnancies. She

testified that during parts of the relevant

time period she was earning about $25.00 per

day hauling farm labor with her truck.

3. Mary Boyd, at the time o= the events

upon which her Title VII charge was based,

was forty-nine years of age. Her education

was at the sixth grade level. The "Adult

Basic Learning Examination" administered to

her revealed a reading level of fourth grade

- 74a -

and math level of fourth grade. Her previ-

ous work history was in the field of farm

work and housecleaning. Her type work pre-

ferred was "nurse aide training" or "cafe."

She, too, had been referred to the STAR pro-

gram to assist in removing her employment

barriers, and participated in the program

until it was terminated. In 1971 she was

referred by the Cleveland MSES office to

nurse aide training, and upon completion was

referred to Community Hospital in Mound

Bayou, where she was hired as a nurse aide.

4. Robert Williams, at the time of the

events upon which his Title VII charge was

based, was thirty-six years of age. His

education was at the second grade level.

The "Adult Basic Learning Examination" ad-

ministered to him revealed a reading level

of below first grade, and math level of

second grade. His previous work history

was tractor driving and other farm work.

* 79a.

He, too, had been referred to the STAR pro-

gram to assist in removing his employment

barriers, and participated in the program

until it was terminated.

None of the named plaintiffs who testi-

fied was able to cite any referral of a

white or a male who was less qualified than

they, or similarly qualified, to any job

which named plaintiffs believed they should

have been referred to. The testimony of

these plaintiffs showed that they were well

aware of their employment barriers, and

that they were making an effort to remove

those barriers. Plaintiff Boyd testified

that she had no objection to being classified

or referred as a maid, and plaintiff Williams

testified that janitorial type work was about

all that he was capable of doing. In addi-

tion to the STAR training, defendants MSES

also furnished other counseling and training

opportunities to the named plaintiffs in an

= 76a -

effort to prepare them for entry into the

Bolivar County job market at the highest

level for which they might be qualified. On

or about February 27, 1970, named plaintiffs

filed Title VII charges against MSES, charg-

ing discriminatory service to them.

None of the plaintiffs who testified

had any dealings with defendants Lindsey or

Aldridge, or knew who they were.

B. Members of Plaintiff Class

Testimony was taken from some seventeen

other black applicants, male and female, who

were seeking employment ot sought the

services of the Cleveland MSES office toward

that end. These witnesses, with varying

qualifications, were rendered various serv-

ices by the Cleveland MSES office. There was

no credible testimony from these witnesses

that any white, or male, job applicant less

qualified, or similarly qualified, was re-

ferred to any job which these members of the

- 77a -

plaintiff class believed they should have

been referred to. There was evidence of

referral to Baxter Laboratories, as well as

to other desirable employers, and evidence

of various other appropriate services ren-

dered by the Cleveland MSES office to this

group of plaintiffs. Some did not respond

to MSES "call in cards", and their applica-

tions were inactivated pursuant to Employ-

ment Security Manual provisions.

One of these witnesses, Adeline Ward

Brown, who complained that she was classified

in a code for domestic maid was referred to

a job at Baxter Laboratories a week later.

The use of one classification would not pre-

vent the referral to a job in another code,

if such a suitable job became available.

Testimony on behalf of plaintiffs relat-

ing to services rendered to black and female

applicants dealt with various individual

complaints, and surmised that better service

should have been rendered to them.

- 78a -

C. Plaintiffs' Statistical and Expert

Evidence.

Plaintiffs, through the pretrial dis-

covery process, were afforded a great number

of documents by both state and federal defend-

ants. They were also furnished a massive

amount of factual information by way of an-

swers given to interrogatories propounded to

the defendants.

Based upon the information secured

through the sources just mentioned plaintiffs

prepared a detailed computer printout to sum-

marize the information obtained so as to pre-

sent the same to the court in understandable

form. The printout was used as a basis for

the preparation of charts and schedules by

plaintiffs for presentation as evidence to

the court.

From the information obtained at the pre-

trial stage by the parties, a stipulation was

prepared and furnished the court at trial.

The instrument contained a list of

- I *

approximately 109 stipulations of fact which

the parties agreed would not be controverted.

Using this wealth of material, plaintiffs'

analyst prepared numerous charts which were

alleged to contain evidence of discrimination

on the basis of race and sex by the state and

federal defendants in the processing of appli-

cations for referrals and in making referrals

on job orders at the Cleveland MSES office.

Based upon the charts and information of

record, plaintiffs' experts opined that the

named plaintiffs and members of the class had

been and were being discriminated against on

the basis of race and sex by defendants

through the Cleveland MSES office in proces-

sing applicants for job referrals and in

making referrals on job orders received from

prospective employers.

For the reasons hereinafter given, the

court finds that the testimony of the

experts and analyst introduced by plaintiffs,

- 80a -

was not sufficient to support plaintiffs'

burden of proof on the issues involved.

V. The Defendants' Evidence

A. Operation of the Cleveland Office of

MSES

1. Service to Applicants

Ernest C. Lindsey, the manager of the

Cleveland office since 1968, and a defendant

in both his official and personal capacity,

was called by the plaintiffs as an adverse

witness. He testified at length and in con-

siderable detail, on cross-examination and

later on direct, about the operations of his

office and the procedures that are used to

serve the job applicants who come into that

office. These procedures are for the most

Dare performed pursuant to the Employment

Security Manual, a detailed guide to the

operation of the local office. The services

rendered to the job applicant may be sum-

marized as follows:

The applicant is greeted by the

- 8la -

receptionist, who, after initial interview,

refers him to the interviewer who handles the

Dictionary of Occupational Titles [DOT] job

code families which appear to be of principal

interest to the applicant. The applicant

completes his application form [No. 511] with

assistance as necessary from the interviewer.

A copy of the form appears as an appendix

hereto. A dialogue ensues between the appli-

cant and the interviewer for the purpose of

developing all available information that is

pertinent to determining the applicant's

training, skills, work experience, education,

interests, preferences, availability, and

aptitudes, so that a satisfactory classifica-

tion or coding can be made, within the frame-

work of the 20,000 job codes contained in the

DOT, and also within the framework of the

jobs that are available in the area served by

the Cleveland office. The occupational code

is a nine-digit designation. Other services

-

- 82a -

rendered include counseling, when an appli-

cant is uncertain of his area of interest,

or otherwise appears in need of further as-

sistance in his job search, and referral to

training in an appropriate case. The office

also has available in its Career Development

Unit the CETA, Comprehensive Employment and

Training Act, and WIN, Work Incentive Program,

services for those who are eligible for

those special programs.

The basic function of the local office

is to match people with jobs. The two as-~

pects of the function are to attempt to refer

the applicant to the best available job for

which he is qualified, and to refer on a job

order the best qualified applicant available.

The Cleveland office is limited in its per-

formance of that function by the fact that

the only jobs with which it can match appli-

cants are those contained on Job orders

placed with it by employers in the community.

- 83a -

The Cleveland office's share of the total job

market is predominantly rural. Bolivar

County is a small percentage thereof. [See

State Defendants' Exhibit 32.) Another limi-

tation on its performance of that function is

the great imbalance between the number of job

applicants and the number of job openings

listed with the Cleveland office at any given

time. Mr. Lindsey estimated this ratio to be

about 5 to l. Another limitation is the

mandated Veterans' Preference which MSES

follows in its referrals.

MSES uses only those tests which have

been approved by the Department of Labor, and

only in accordance with the instructions of

the Department of Labor.

Testimony by Mr. Lindsey based on random

examination of referrals on job orders dis-

closed that referrals on various jobs, includ-

ing the most desirable and best paying, were

made without regard to the race or sex of

the applicants referred.

- 8da -

2. The Taking of Job Orders

The interviewer obtains from the employ-

er who wishes to place a job order with the

MSES office the necessary information to complete

the job order form [No. 514]. A copy of the

form appears as an appendix hereto. The form

includes all pertinent information available

that will assist the interviewer in filling

the order, including the details of the job's

requirements and the employer's education

and experience requirements for the job. A

DOT code is arrived at for the job. This

number classification is the nine-digit code

from the Dictionary of Occupational Titles

referred to above, and is used in the process

of matching applicants with jobs.

3. EEOC and Civil Rights Law Compliance

n Bolivar County

The Cleveland office from the time of

the passage and implementation of the Civil

Rights Act of 1964 took steps to assure that

its employees were aware of the provisions

- 85a -

of the Act insofar as it applied to the

operations of that office. Such steps in-

cluded the signing of a log by all employees

that they had read and were familiar with

those provisions, use of self-study packages,

development and use of a practical Training

Unit, regular self-appraisal study and re-

ports, on-going emphasis at staff meetings,

and periodic evaluation by the EEO officer

of the Mississippi Employment Security Com-

mission. Detailed procedures were developed

for the investigation, reporting and proces-

sing of Title VII charges, and directives for

the placement of posters, and other pub-

licity, were complied with. Minority forums

were held for the purpose of maintaining a

good rapport with the local black community,

and monthly "Opportunity News Letters" were

distributed broadly in the black community

of Bolivar County, keeping the community

posted on the varied range of services

- 86a -

available at the Cleveland office. The manag-

er regularly gives talks in the community,

particularly at schools and training sites,

about the Job Bank Viewers, how to use then,

and the opportunities for employment that

they contain.

The regular self-appraisal and evalua-

tion report [Form AP-3] referred to above was

periodically completed with positive showings,

from random samplings of applications and job

order referrals, of services rendered to pro-

tected minorities. [See SD Exhibits 44-45).

The Cleveland office in following the

various procedures for assisting applicants

in their job search did not make any dis-

tinction between applicants because of their

race or their sex. A large percentage of

the clientele of this office were members of

the black race, and the employees of the

Cleveland office performed their duties,

within the limitations mentioned above, for

= 87a “

all applicants on the same basis--that iz,

treating each applicant as an individual,

different from every other individual, in

his training, work experience, aptitudes,

education, job preferences, and availability.

From 1965 until the present, there have

been 30 black employees in the Cleveland

office, with job titles ranging from Farm

Placement Representative to Employment Inter-

viewer. At the present time, out of a total

staff of 11 persons, 4 are black. Their job

titles are Employment Interviewer II [two

with this title], Employment Interviewer I

and Employment Security Aide III.

With the scarcity of job openings on

file in the Cleveland office, the MSES

employees in that office did what they could

by way of classification and referral to try

to help the applicants obtain whatever

suitable work might be available, without

regard to the applicant's race or sex.

- 88a -

B. State Defendants' Witnesses

1. Testimony of Evelyn Lyon, longtime

employee in the Cleveland MSES office, was

to the effect that as Supervisor of the

Career Development Unit in that office her

primary responsibilities were to advise and

counsel with those individuals who were eli-

gible to participate in such special federal

programs as CETA and WIN, and that her

clients were predominantly black. She re-

lated several instances of such services

rendered, which plainly showed exemplary

attitude and service, without regard to race

or sex of the individual client. She also

testified about the counseling services

rendered in the Cleveland local office, and

its use as an employability development tool.

She testified also as to the high rate of

"positive terminations" for blacks in the

CETA program.

2. John E. Aldridge, former executive

- 89a -

director of MSES, and a defendant in both

his official and individual capacities,

testified as to the administrative procedures

adhered to during his tenure in office, and

particularly the lines of communication and

lines of authority from his office down to

the local office manager's level. He testi-

fied that at all relevant times the various

directives from DOL were implemented and pro-

perly disseminated to the field, and that

diligent efforts were made to comply with the

requirements of the Civil Rights Law of 1964,

to assure that all services rendered by MESC

were without regard to race or sex.

3. Reverend J.Y. Trice and Calvin Jones,

both educators and leaders in the Bolivar

County black community, testified as to the

excellent rapport and reputation for good

service enjoyed by the Cleveland MSES office

in that community. They also related in-

stances of such good service with which they

- 90a -

were personally familiar. They further testi-

fied as to the high black unemployment rate

in Bolivar County, and the high incidence of

unskilled black labor in the County, and that

with the applicant-job opening ratio being

what it was, they believed the Cleveland MSES

office was doing the best it could to help

blacks find employment.

4. There were five black job applicants

who testified for the state defendants, and

related the good and productive services that

had been rendered for them. They were

Richard Collins, Lillie Mae Edwards, Elexo

Warrne, Mary Causey, and Marilyn Patton.

They testified that their advice to a friend

seeking work would be to consult the Cleve-

land MSES office for help. These witnesses

were sincere and credible, and their testi-

mony revealed what may be considered typical

service rendered without regard to race or

sex.

- 9la -

5. George Nash, a black employee in the

Cleveland MSES office, presently contract

writer with additional duties as employment

interviewer, testified at length about his

duties as well as the procedures followed in

the Cleveland office in serving an applicant

who comes in--from his reception at the front

desk, to the final interview, and referral to

a job--with reference to the applicable

Employment Service Manual provisions followed.

His testimony paralleled that of Ernest

Lindsey in many respects. He has been with

MESC for about eleven years, and previously

held positions of CEP outreach worker, and

employment interviewer.

6. Don Drane, presently manager of the

Greenville MSES office, testified as to his

earlier employment at the Cleveland office

when he worked with the named Plaintiffs in

the CEP program. He identified certain of

the CEP and STAR records pertaining to those

- 92a -

individuals, and testified as to the purposes

behind the CEP, STAR, and related programs,

and the strong efforts made by the Cleveland

MSES office to help the participants or en-

rollees in those programs to remove their

employment barriers, and obtain productive

employment.

7. Louis Beverly, the MESC EEO Officer,

and a black, testified concerning the duties

of his office, and particularly about his

observations and evaluations of the Cleveland

MSES office over a period of years. He has

served in this position since 1972. He re-

viewed several evaluation reports which he

had made on that office, and related his con-

clusions as to the positive, ongoing efforts

which have been and are being made there in

service to applicants without regard to race

or sex. [See S-D Exhibits 56, 57, and 80.]

8. Charles Ballard, Assistant Director,

Employment Service Division, who has been with

- 93a -

MESC for over forty years, testified about

the relationship between the Department of

Labor and the MESC, and the Employment Se-

curity Manual and its directives for local

office operations. His testimony further

covered the period of time when he was Chief

of Programs & Methods Department for MESC,

when in that capacity his department super-

vised the administration of tests. His

testimony was that the Cleveland MSES office

at all times complied with DOL directives

and procedures in the use of tests. He

further testified that if there was ever any

doubt about the appropriate use of a test,

his department would always clear it with

the DOL before going ahead with such use.

C. The Relationship of State and

Federal Defendants

l. The Mississippi State Employment

Service (MSES) is a division of the Missis-

sippi Employment Security Commission. MSES

is a State operated employment service within the

- 94a -

system of State and local employment services

receiving Federal assistance under the Wagner-

Peyser Act, 29 U.S.C. § 49-49K. MSES main-

tains and operates employment wencies through-

out the state.

2. Under the system of "cooperative

federalism" envisioned by the Wagner-Peyser

Act, the Secretary of Labor makes grants to

pay the administrative costs of operating

State Employment Service Agencies. The

various State agencies are created by the

State law and are operated as agencies of

State government. Through his authority as

grantor of the funds for the state agencies,

the Secretary of Labor exercises general

supervisory authority over these State employ-

ment services. The Secretary of Labor pre-

scribes the general policies under which the

State employment service agency performs its

functions. Particularly in the field of

client service at the local office area,

- 95a -

Federal policy provides for wide flexibility

and discretion to State personnel in the per-

formance of their duties.

3. Section 602 of the Civil Rights Act

directs Federal departments and agencies

empowered to extend Federal financial assist-

ance "to any program or activity, by way of

grant, loan or contract" to effectuate the

purpose of the Act by issuing implementing

rules and regulations. The Secretary of

Labor on December 4, 1964 published implemen-

ting regulations applicable to the Employment

Service as well as other departmental pro-

grams in the Federal Register (at pp. 16284-

16287 as Part 31 of Title 29 of the Code of

Federal Regulations). Implementing instruc-

tions were also incorporated in the Employ-

ment Security Manual (ESM) Part II Sec. 1294.

(FD exhibit 51).

4. The Secretary of Labor also issued

to all State employment security agencies,

- 96a -

including MSES policies and instructions de-

signed to forbid and avoid discrimination in

referral, classification or testing and these

policies and the instructions are legal and

effective. These policy statements include:

(a) General Administration Letter

833, December 31, 1964, Nondiscrimi-

nation in Federally Assisted Programs

of the Department of Labor - Effectua-

tion of Title VI of the Civil Rights

Act of 1964 - with attached copy of

29 C.F.R. Part 31 (FD Exhibit 7).

(b) United States Employment Ser-

vice Program Letter 1919, November 9,

1965, Employment Practices under Title

VII of the Civil Rights Act of 1964.

This order superseded any conflicting

instructions in the Employment Service

Manual (ESM) with respect to implementa-

tion of Title VII of the Civil Rights

Act of 1964. Its purpose was to

- 97a -

discontinue the noting of sex and age

specifications in Job Bank Job Order

listing (FD Exhibit 9).

(c) General Administration Letter

1054, February 1, 1967, Conformance with

the Provisions of Title VII of the Civil

Rights Act of 1964 which Prohibits Sex

Discrimination in Employment and Train-

ing Programs. Its purpose was to assure

full compliance with the sex discrimina-

tion provisions of Title VII of the

Civil Rights Act of 1967 [sic]. (FD Exhibit

17).

(d) Training and Employment Serv-

ice Program Letter 2582, October 9, 1970,

Discriminatory Specifications on Job

Bank Job Order Listings. Its purpose

was to discontinue the noting of sex

and age specifications in Job Bank Job

Order listings. (FD Exhibit ll).

(e) Training and Employment

- 98a -

Service Program Letter, December 27,

1971, Elimination of Comments on Person-

al Traits and Characteristics on Appli-

cation and Order forms, instructed State

agencies to eliminate and delete all

comments on personal traits and charac-

teristics on Application Forms, ES=-5ll

and Order Form, ES-514 since they can

be unfairly discriminatory. (FD Exhibit

13).

(£) U.S. Employment Service Program

Letter, 2698, May 17, 1966, Guidelines

on Sex Discrimination Provisions of

Title VII of Civil Rights Act of 1964.

Disseminated additional information on

the guidelines concerning the sex dis-

crimination provisions of Title VII and

attaching EEOC guidelines on sex dis-

crimination. (FD Exhibit 15).

(g) General Administration Letter

1466, July 5, 1972, EEO Guidelines on

- 99a -

Discrimination Because of Sex. To in-

form State agencies of the New EEOC

Guidelines on Discrimination Because of

Sex. (FD Exhibit 19).

(h) Training and Employment Service

Program Letter No. 2756, Proper Use of

General Aptitude Test Battery (GATB),

in Counseling and New Policy on Use of

Specific Aptitude Test Battery (SATB)

in Selection. To reemphasize the need

for careful interpretation of GATB test

results in counseling particularly when

working with minority group applicants

and to issue a new interim referral

policy to assure that minority group

applicants are not discriminated against

in testing and selection for referral to

jobs. (Stipulation Exhibit 56).

(i) Training and Employment Service

Program Letter No. 2756, Change 1; issued

a list of SATB's that may be used in

- 100a -

selection in accordance with standard

Employment Security Manual procedures.

(Stipulation Exhibit 57).

(j) General Administration Letter

No. 18-79 Uniform Guidelines on Employee

Selection Procedures (1978), transmit-

ting the Guidelines and to provide in-

formation on the implementation of the

Guidelines. (FD Exhibit 54).

5. State Employment Service Agencies

are required to follow the policies stated

in the Employment Security Manual (ESM). The

purpose of the ESM is to set the minimum

standards for operating the State employ-

ment services. 29 U.S.C. § 49b. These

standards can be altered or expanded to fit

the State's particular labor market.

The States have flexibility in running

their employment services provided they do

not violate Department of Labor policies or

operate below the minimum standards as set

- l10la -

forth in the ESM or instructions. (FD Exhibit

Sl unless otherwise noted.) Those policies

include:

(a) The classification of an appli-

cant in terms of the Dictionary of

Occupational Titles (DOT) on the basis

of an evaluation of all occupational

qualifications as shown by work experi-

ence, training and personal character-

istics; not to extend preference to any

applicant or group, except in accord-

ance with legal requirements and to

ensure, as far as practicable, that

applicants suitably qualified for job

openings are referred to employers.

ESM Part II, § 1005.

(b) The application process as a

part of the placement process in which

the interviewer reviews, analyzes and

completes information on applicant quali-

fications, determines the need for

- 102a -

counseling and gives the applicant in-

formation which may increase his or her

opportunities for placement. ESM Part

§ 1010.

(c) Work experience as a major

source of an applicant's occupational

qualifications. It is essential for the

interviewer to consider all significant

variable factors. ESM Part § 1066.

(d) Personal characteristics, in-

cluding vocational interests and prefer-

ence, must be considered in determining

occupational qualifications in addition

to information on work experience and

training. ESM Part II § 1070.

(e) Interviewers explain to the

applicant the various occupational codes

(DOT) for which they qualify and ask

them to state occupational preferences.

When the applicant's preferred occupa-

tional code is not assigned, justifica-

tion of the assignment should be noted

- 103a -

on the application card. ESM Part II

§ 1090.

(£) Interviewers explain the method

of operation of the local office so the

applicant understands the method of

selection, and explains the meaning of

any occupational title and skills if re-

quested by the applicant. ESM Part II,

§ 1100.

(g) The interview for the assigning

of occupational (DOT) classifications

of applicants is a fact finding process.

Occupational classification shall be

assigned solely on the basis of factors

bearing on job performance and no clas-

sifications shall be made on the basis

of or influenced by race, creed, color

or national origin. ESM Part II, § 1190.

(h) In making an occupational clas-

sification the interviewer evaluates

evidence of an applicant's

- 104a -

qualifications, determines a specific

job or jobs or fields of work to which

significant evidence points and compares

the skills, knowledge and the ability of

the applicant with the code requirements.

The interviewer discusses the possible

Classifications with the applicant. ESM

Part II, § 1191.

(i) An interviewer should rarely

consider personal characteristics alone.

However, with inexperienced applicants

an interviewer may be forced to con-

sider personal characteristics such as

personal status, aptitudes, personal

traits and vocational interests. ESM

Part II § 1198.

(j) The interviewer in consulta-

tion with the applicant develops one or

more occupational codes and picks one as

the primary code. Where opportunities

for employment are limited the

- 105a -

interviewer insures that there is at

least one additional classification for

which there is a specific or general

Opportunity for work. ESM Part II

§ 1203.

(kK) The interviewer informs the

applicant of all codes assigned to him

or her. In some cases, this discussion

will bring to light any conflicts over

the assignment of codes. ESM Part II

§ 1205.

(1) Job opportunities for unskilled

workers may be increased by the use of

summary job code groups. This technique

consists of grouping related processes

or functions which normally require

familiarly [sic] with the industrial or

occupational environment but in which

specific experience requirements do not

justify a full five or six digit code.

The Mississippi Employment Service

- 106a -

Manual does not contain a similar sec-

tion. ESM Part II, § 1225.

(m) Order taking is the process the

interviewer uses for gathering informa-

tion about the job from the employer for

referral purposes. The nature of the

job may be such that the interviewer may

gather the necessary information about

job content and worker qualifications by

means of an interview with the employer.

Other jobs may be sufficiently complex

that information is more effectively

obtained by actual observation of the

job. ESM, Part II § 1250.

(n) The local office is prohibited

from processing job orders that are

contrary to Federal, State or local

laws. ESM Part II § 1290.

(o) The local office is prohibited

from processing employer job orders

where there is evidence or information

- 107a -

that the employer discriminates by race,

color or national origin. Any employer

specifications that result in the exclu-

sion of applicants of a particular race,

color or national origin are discrimina-

tory even though the employer specifica-

tions are not expressly discriminatory.

Although this section does not list

every conceivable form of discrimination

the instructions are sufficient to put

local offices on notice of the types of

discrimination that may exist. ESM Part

II § 1294.

(p) The selection of applicants for

referral involves a 3-step process:

determining performance/non-per formance

job requirements, accurately determining

applicant qualifications and preferences,

and a point by point comparison of

qualifications and job requirements.

ESM Part II § 1450.

- 108a -

(q) In selecting applicants for re-

ferral the interviewer must beware of

hiring requirements which have little

or no relation to work performance re-

quirements. ESM Part II § 146l.

(r) The interviewer, in making a

referral, should consider the factors

influencing the applicant's acceptance

of the referral. The vocational inter-

ests and substantiated interests of the

applicant deserve careful consideration

in deciding the appropriateness of the

job referral. ESM Part II, § 1507.

(s) Since applicants rarely exactly

meet all of an employer's requirements,

the interviewer should discuss the

applicant's qualifications with the

employer in order to effect a compromise

such that the employer will relax non-

performance requirements in favor of

otherwise acceptable applicants. ESM,

- 109a -

Part II § 1508.

(t) The local office cannot make

referrals on orders containing discri-

minatory specifications with respect to

race, creed, color or national origin.

ESM Part II, § 1650.

(u) Employment service local

offices should give necessary emphasis

and attention to carry out employment

service functions, including relations

with minority applicants, employers and

the community in such a manner as will

best promote nondiscriminatory employer

employment practices. ESM Part II

§§ 8100-8170. (FD Exhibit 52).

(v) The objective of the employment

service in providing services to women

is to assure that they are given equal

consideration for employment opportunities

and any other needed services. Job clas-

sifications should be made to provide

- 110a -

maximum exposure to job openings, and

special care should be taken to avoid

placing her in stereotyped categories

associated with women. Local offices

are prohibited from processing job

orders that contain unlawful sex speci-

fications. ESM Part II §§ 8710-8739.

(FD Exhibit 32.)

6. The system outlined in the ESM con-

templates an objective, nondiscriminatory

evaluation of an applicant's skills, abili-

ties and preferences and a job related

analysis of the employer's needs. None-

theless the system depends on the skills,

judgment and attitudes of each local office

interviewer. The system allows an interview-

er flexibility in matching applicants with

job opportunities based upon job related

factors. Neither federal nor central state

authorities can exercise complete control

over the one-on-one relationship at an

- llla -

employment service interviewer and an appli-

cant or an employer.

D. Statistical Expert Evidence

The State Defendants introduced an ex~

pert witness to present their statistical

analysis of rate of referrals for job appli-

cants and the average rate of salaries of

those job referrals.

The Federal defendants introduced ex-

pert evidence to support the validity of

tests prepared by MSES for use by the Cleve-

land office in making job referrals of job

applicants.

VI. The Battle of the Analysts and/

Or Experts,

A. Plaintiffs' Analytical and Expert

Evidence,

Plaintiffs' analyst prepared from the

statistical evidence obtained for use at

trial certain exhibits and charts.

Relying upon the premise that all

available and material factual and statisti-

cal information had been obtained and

- ll2a -

presented to plaintiffs' analyst for her con-

sideration in preparation of exhibits and

charts and the accuracy of her analysis

thereof, plaintiffs' experts concluded that

those in charge of the Cleveland office and

responsible for the referral of job appli-

cants on job orders were guilty of discrimi-

nating against plaintiffs and members of

the class on the basis of race and sex.

Dr. James L. Outtz, an expert in Test-

ing and Industrial Psychology, testified

for plaintiffs. He based his conclusions

primarily on plaintiffs' Exhibits 145, 163

and 127 and Stipulation paragraph 78.

At trial, the Federal Defendants pre-

sented a motion to dismiss the action as to

the Federal Defendants. The motion was

premised on the proposition that the evidence

presented by plaintiffs upon which Dr. Outtz

based his opinion was not sufficient to

support his conclusions.

- 1l3a -

Plaintiffs' Exhibit 163 is a chart pre-

pared by MSES showing test results on speci-

fic aptitude test batteries administered by

the Cleveland office in 1971. From this

data, plaintiffs developed their Exhibit

145 which arrays the same information and

adds to it a calculation of the percentage

of persons with scores below norm, a per-

centage which they characterize as the per-

cent of people who failed the examination

or test. Dr. Outtz analyzed the percentages

found in the percent failed column in Exhi-

bit 145 to reach the conclusion that there

was statistical adverse impact. Dr. Outtz

did not independently know which persons

fell in the column headed "Number With

Scores below Norm."

The record reflects that the chart

included in plaintiffs' exhibit 163, was

prepared by David Morris. Mr. Morris in-

cluded in the figure given in the "below

- ll4a -

norm" column those persons taking the test

who scored either "M" or "L". The figures

used by Dr. Outtz from plaintiffs' exhibit

163 in the "below norm" column does not

identify those who failed the test. For an

explanation of letter grades H, M and L,

see infra.

The Federal defendants concluded that

Since it was possible that all or most of

the people with scores below the norm re-

ceived the letter grade M and could have

been in the pool of people referred, calcu-

lations based upon the chart in Plaintiffs'

Exhibit 163 cannot show adverse impact.

Plaintiffs' Exhibit 127 purports to

show a different rate of referral for

blacks or whites of persons coded in the

nurse aide code who were referred to a nurses

aide training program. The evidence re-

flected that Dr. Outtz did not know how many

if any of those persons were test selected.

- 11548 =

In the absence of such information, the

Federal Defendants argue that this exhibit

cannot demonstrate adverse impact in fact in

terms of test selection.

Stipulation paragraph 78, contains a

chart of racial differences on scoring on

various aptitudes of the general aptitude

test battery (GATB). Federal Defendants con-

tend that since no evidence was presented to

demonstrate any impact of any tests in the

Cleveland office, the information contained

in Stipulation Paragraph 78 does not prove

anything.

The motion to dismiss made during the

trial, was briefed by the parties on one-

day notice. After having given due con-

sideration to the matter, although impressed

with the validity of the position asserted

by the Federal defendants, the court elected

to overrule the motion in favor of finishing

the trial and deciding the action on the merits.

- ll6a -

The Federal Defendants have filed a

post-trial motion to dismiss or for summary

judgment for failure to make a prima facie

case of adverse impact. The motion presents

the same issues included in the Federal

Defendants' motion to dismiss filed during

the trial. The parties have submitted addi-

tional memoranda supporting their respective

views.

The action has been tried in its entire-

ty. The court concludes that the interest

of all parties will be served by treating

the post-trial motion as moot.

The court received other expert evi-

dence in support of plaintiffs' position

that the evidence as a whole sustained plain-

tiffs' charge of discrimination on the basis

of race and sex by the Cleveland office.

Plaintiffs' expert evidence also

attacked the validity of the tests promul-

gated by the Federal Defendants for use by

- Lia *

MSES at its Cleveland office on three spe-

cific occupations--(1) table worker posi-

tions (S-28); (2) licensed practical nurses

training programs (S-270); and (3) nurses

aide training and jobs (S-282) and asserted

adverse impact from use of the test on

black applicants.

The discrimination in testing issue was

the subject of extensive expert evidence

introduced at the trial. Plaintiffs as-

serted invalidity of the tests and adverse

impact of each upon the opportunities of

members of the black race seeking employment

through the facilities of the Cleveland

office.

The Federal defendants defend the

validity of the test through their own

expert evidence and assert that proper vali-

dation procedures were taken on the test

used in each of the occupations under attack.

- 118a -

B. The Testing Issue.

The court has tried the issues pertain-

ing to the validation of the tests prepared

by the Federal Defendants and used by MSES

at its Cleveland office. From the evidence

introduced, the court finds:

1. The United States Employment

Service (USES) has developed the General

Aptitude Test Battery (GATB) and the

Specific Aptitude Test Battery (SATB)

for use in the local employment service

offices.

2. The GATB is composed of eight

pencil and paper tests and four appa-

ratus tests designed to measure the

nine aptitudes found to be important

for successful performance on various

jobs. The nine aptitudes and tests

are as follows:

G - Intelligence

- 119a -

Part 3--Three Dimensional Space

Part 4--Vocabulary

Part 6--Arithmetic Reason

Verbal Aptitude

Part 4--Vocabulary

Numerical Aptitude

Part 2--Computation

Part 6--Arthemetic [sic] Reasoning

Spatial Aptitude

Part 3--Three-Dimensional Space

Form Perception

Part 5--Tool Matching

Part 7--Form Matching

Clerical Perception

Part l--Name Comparison

Motor Coordination

Part 8--Marking [sic] Making

Finger Dexterity

Part ll-- Assemble

Part l12-- Disassemble

Manual Dexterity

Part 9--Place

Part 10--Turn

The GATB was developed on the

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basis of a statistical analysis of 59

different kinds of tests which had been

used in predicting performance in a wide

variety of occupations. The nine GATB

aptitudes were selected because they

provide adequate measures of all the

major abilities measured by the 59 tests.

(Stipulation Exhibit 80, FD Exhibit 50,

Testimony of John Hawk).

3. The GATB and Occupational Apti-

tude Patterns (OAP) are counselling

devices and their use is governed respec-

tively by § 9300 and § 4000 of Part II

of the Employment Service Manual. These

tools are not to override the indi-

vidual's employment desires or job

choices. The GATB or OAP are not at

issue. (Stipulation exhibits 80 and 54,

FD Exhibit 50).

4. The GATB was developed by the

United States Employment Service (USES)

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and has been used since 1947 by State

employment services. Since that time

the GATB has been involved in a continu-

ing program of research to validate the

tests in many different occupations and

to insure that the tests used meet pro-

fessional standards and legal require-

ments. The USES has consistently used

the best information available, at the

time, to develop high quality tools to

further the basic goals of the employ-

ment service. USES research is goal-

oriented so research efforts have been

almost entirely in the area of applied

as opposed to pure research. Wherever

possible the USES has applied tech-

niques and procedures which have been

developed by others and demonstrated to

have utility. (Testimony of John Hawk.)

5. The SATB is a test battery

consisting of 2 or more of the GATB

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aptitudes and is used as a measure of

potential for success in a specific occu-

pation.

6. Only the S-28, Table Work,

S-270R Liscensed [sic] Practical Nurse

and S-282 Nurse Aid tests are at issue

in this case.

7. Since 1967 the majority of USES

research efforts have been the investi-

gation of the impacts of its tests on

minority groups. USES research staff

was doubled in 1972 for this purpose.

An enormous amount of information has

been gathered on USES tests and, the

general finding is that USDOl tests are

fair for minority groups. This also

has been the finding of other investi-

gations that have studied USES tests.

(Testimony of John Hawk and Dr. John

Hunter).

8. The use of the USES tests is

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governed by the Employment Service Manu-

al, Part II §§ 9000-9999 and includes

the following sections:

(Stipulation exhibit 54 unless

otherwise noted.)

a. It is the policy of the USES

to use objective tests and related tech-

niques as needed in the operation of

employment service counseling testing

and placement programs. ESM Part II,

§ 9001.

b. USES tests are developed to aid

in the selection and referral of inex-

perienced, untrained and entry workers

and under certain conditions for future

promotion or transfer to more skilled

positions. Applicants for specific

occupations may be tested if the job

order calls for workers with no previ-

ous experience in the job, newly re-

cruited workers who will be provided on

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the job training or newly recruited

workers are to be considered to promo-

tions to other than entry level jobs.

c. Aptitudes tests should not be

used when the individual is experienced

and has demonstrated proficiency in the

occupation under consideration, the

employers job order calls for specific

work experience and aptitude test norms

have not been developed for a particular

occupation. There is no arbitrary or a

priori choosing of tests and test

scores. ESM Part II § 9157.

d. The application form of plain-

tiff Rebecca Gillespie indicates that

she was given the nurse aid SATB al-

though she was experienced as a nurse

aid. (Stipulation Exhibit 8).

e. The interpretation of test

scores is not a mechanical process.

Although aptitude tests are more

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accurate in determining an applicant's

qualifications than any subjective means,

test results are only one factor in

determining an applicant's fitness for

specific job opportunities. Other

factors to be considered are educational,

special skills, knowledge and physical

Capacity. ESM Part II § 9319.

f. In interpreting test results

the interviewer or counselor should as-

sume that the individual tested has at

least the amount of aptitude demonstrat-

ed in the test and possible [sic] more. An

applicant should not be excluded from

consideration for a job or training on

the basis of test results alone. If the

aT.

epplidant meets the other hiring speci-

fications or Beaining requirements, he

or she may be referred for considera-

tion together with test selected appli-

cants. ESM Part II § 9312.

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g. The USES has provided State

employment services complete instruc-

tions for the administration and scor-

ing of the SATB and are contained in

the Manual for the GATB and the ESM.

ESM Part II § 8395. (Stipulation ex-

hibit 80, and 54.)

9. The SATB is scored H, M, or L.

There are no absolute pass or fail scores.

The letter scores are interpreted as follows:

H - Meets or exceeds all of the norms

for a particular SATB. An appli-

cant receiving H is judged to be

satisfactory for the job, if also

qualified on the basis of factors

other than aptitude and may be

referred.

M - The obtained score plus one stand-

ard error of measure meets or

exceeds all the norms for a parti-

cular SATB. M scores are close to

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those workers judged to be satis-

factory and may be referred.

The obtained score plus one stand-

ard error of measure are below the

requirements for "M". The chances

of an applicant being satisfactory

on the job are low. The applicant

should be considered for other jobs

which utilize stronger aptitudes.

An applicance may be referred al-

though if warranted by (1) factors

other than aptitudes i.e., inter-

ests, training, experience, or

motivation (2) local labor condi-

tions requiring more than available

H & M applicants (3) the employer

has agreed to accept less competi-

tive applicants as a result of job

development. ESM Part II § 9312.

(Stipulation exhibit 54, Testimony

of John Hawk.)

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10. USES deliberately set its cutting

scores to "pass" at least 2/3 of those tested.

Thus, instead of rejecting the vast majority

of applicants, USES procedures insure that

these applicants are given further considera-

tion.

ll. The "cut off" score for USES tests

is set at a 2/3 - 1/3 level because USES

experience over the years has been that 1/3

of employed workers are unsatisfactory; hence

the 2/3 - 1/3 division was used in both the

test scor

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