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NAACP v. North Hudson Regional Fire & Rescue, No. 10-3965 (3d Cir. Dec. 12, 2011)

For the second time in three months, The Third Circuit confronts a New Jersey municipal residency requirement - challenged for disparate impact under Title VII - and once again rules in favor of the applicants. One twist in this case was that the residency requirement was, in part, arguably required by a consent decree. The panel rejects a Ricci defense.

NAACP v. North Hudson Regional Fire & Rescue, No. 10-3965 (3d Cir. Dec. 12, 2011): Just last autumn, in Meditz v. City of Newark (3d Cir. Sept. 28, 2011), the Third Circuit remanded a Title VII disparate impact claim by a white applicant seeking employment in Newark, New Jersey, finding that summary judgment was improperly granted to the city. In the present appeal, the panel affirms summary judgment for a group of African-American plaintiffs challenging a municipal residency requirement that discriminates in favor of resident Latinos.

The employer, a fire department covering five New Jersey towns, was subject to a consent decree entered by a federal court in 1980, which - among other things - mandated a residency requirement for firefighters. In 2001, a group of thirteen Latino candidates sued, once again claiming Title VII disparate impact (on the basis of their nationality - the Rodriguez litigation); the city settled that case in 2005 without any commitment to hire any other than four of the plaintiffs.

In the ordinary course, under NewJersey state law, hiring for the department takes place off of a ranked list based on an exam. Notably, the residency requirement covers only the date of hiring; once hired, the employee may live anywhere (and often do move out of the area). The resident population as of the year 2000 was 69.6% Latino, 22.9% white and 3.4% African-American.  At the commencement of the litigation, North Hudson sought to hire 35-40 new officers. Latino candidates, including six who intervened into this case, dominated the hiring list. Only two out of 323 (0.62%) of the officers were black.

Such was the status quo through 2007, when the NAACP commenced this case, challenging the underhiring of African-Americans.

On cross summary-judgment motions, the district court considered expert reports by both sides and held both that the plaintiffs established a prima facie case of disparate impact against African-Americans, and that the employer failed to established a business necessity for requiring firefighters to be hired from the five-village region, even though they could move after hiring. After determining that the correct labor pool was statewide and consisted of those employed in "protective services jobs" (e.g. police, firefighters, guards), the plaintiffs' expert determined that North Hudson - absent the residency requirement - ought to have retrained between 65 and 115 African-Americans instead of just two.

The Third Circuit affirms. The panel holds that the plaintiffs' expert properly identified both the relevant labor market and qualified population of applicants. The panel further holds that the defendants' expert, far from creating a genuine issue of material fact, actually corroborated the causal link between the residency requirement and the underemployment of blacks. The panel rejects the employer's proffered business-necessity justifications that the residency requirement "(1) increases the likelihood that its firefighters will be able to respond to emergencies more quickly because they will be more familiar with the buildings and streets in the served community; (2) comports with the terms of the Rodriguez Settlement; (3) increases the number of Spanish-speaking firefighters in a department that serves a 69% Hispanic population; and (4) fosters community pride." As to each, the panel holds there was no empirical support, there were lesser-discriminatory means to achieve the goals or that the justification was simply insufficient.

The panel also rejects a Ricci defense by the defendant and Latino intervenors, i.e., "a 'strong basis in evidence' to believe that failing to engage in the discriminatory action being challenged would lead to disparate impact liability." The panel notes that while in Ricci the city had already committed itself to the firefighter exam results (which led to an impact against minorities), here "North Hudson's only action is the use of its Residents-Only List, which has been demonstrated to cause a disparate impact in violation of Title VII. It has taken no steps to eliminate the residency requirement or otherwise adjust its policies to reduce the adverse effect."

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