How would you avoid disparate impact liability?

Disparate impact theory tells employers that they have broken the law when a concededly neutral hiring practice produces too many employees of one race and not enough of another.

Let’s say you’re an employer looking to hire 20 people from a pool of 100 applicants. You give the same standardized test to all 100 applicants and pick the top 20 scorers. Imagine that all agree the test is fair and you’ve acted with no intent to discriminate. Then the government tells you that your test had a disparate impact on a racial group. Federal regulations require you to record the race of each applicant, and the results show that the passage rate for one racial group was less than 80% of the rate of the highest scoring group. That’s enough for an initial showing of disparate impact.

You make the case for your innocence. You produce enough evidence for every person in the world to conclude that you’ve acted with no intent to discriminate. That’s not enough to absolve your “guilt”; there is no good-faith defense to disparate impact liability. Your only option is convincing a court that your hiring practices were essential to your business. But even if you manage to do that, you are still a lawbreaker if the government can conjure up a test that serves your business needs but results in what it deems to be a more desirable racial balance.

The only real way to avoid disparate impact liability is to ensure a particular racial balance. This could be done by changing the rules mid-game, which creates the sort of ugly racial hostility that no one wants to see. Or an employer could use some pretext to fill the final spots with members of an underrepresented race. In other words, disparate impact tells employers to engage in the sort of harder-to-detect forms of intentional discrimination that disparate impact is supposed to weed out.

The Supreme Court has yet to rule on the constitutionality of disparate impact, but may very well hold it unconstitutional when it does. At the very least, disparate impact theory is out-of-tune with constitutional values embodied in the Equal Protection Clause. Disparate impact theory focuses exclusively on racial groups; the Equal Protection Clause protects individuals. Disparate impact is concerned with the never-ending task of remedying some amorphous concept of societal discrimination; the Equal Protection Clause is concerned with getting to the point where race is irrelevant to personal opportunity. Disparate impact forces employers to engage in racial balancing; the Equal Protection Clause says that such balancing is patently unconstitutional. PLF continues to oppose disparate impact, and we hope the Supreme Court will soon consider the constitutionality of such an odd theory.