Today Pacific Legal Foundation filed this amicus brief in EEOC v. Kaplan, which was joined by the Cato Institute, the Center for Equal Opportunity, the Competitive Enterprise Institute, and Project 21. EEOC has been particularly aggressive in pursuing disparate impact cases lately, and its case against Kaplan is representative. Like many companies—and like EEOC itself—Kaplan conducts credit checks on some of its job applicants. Kaplan instituted this policy after some employees embezzled company funds, based on the very rational theory that those applicants who were under financial stress would be more likely to abuse their access to company funds. EEOC sued Kaplan alleging that its practice has a disparate impact on African American applicants.
What happened next was especially pernicious. In order to prove that Kaplan’s policy caused a disparate impact on minority applicants, EEOC needed to determine the race of the rejected employees. To do so, EEOC created a panel of “race raters” to look at the rejected applicants’ driver’s license photos and decide—according to the color of those applicants’ skin and the shape of their features—their race.
In our brief, we argue that EEOC’s actions offend basic principles of equal protection. Not only is EEOC’s use of “race raters” unscientific, it is offensive. Such judgments reduce the concept of race to nothing more than physical characteristics, when race is a much richer concept than “looks.” Such categorizations also discount multi-racialism; they unfairly fit individuals of mixed races into crude categories. Any race-based distinction will involve the government in the unsavory business of deciding who belongs to which race. Perhaps it’s for this reason that EEOC itself counsels employers to ask their employees to self-identify their race for record-keeping purposes, rather than use visual identification.
We also note in our brief the perverse consequences of disparate impact theory. Because, under disparate impact theory, employers can be held liable for race-neutral practices that result in hiring disparities among races, the theory encourages employers to engage in covert racial balancing. Thus, the theory encourages the very behavior equal protection was designed to prevent. We conclude that EEOC’s dubious use of the theory in this case cannot withstand equal protection scrutiny.