18th Annual Workplace Class Action Report - 2022 Edition

Annual Workplace Class Action Litigation Report: 2022 Edition 63 was open 24-hours a day and was located in a highly tourist-heavy town, such that weekend work was often very busy, particularly during the summer months. Hedican’s supervisor determined that if Defendant were to accommodate Hedican in the assistant manager position, it would require the other seven assistant managers to work the weekend shifts that he was unable to work, shifts that all assistant managers would rather have off than be scheduled to work. Alternatively, Defendant would be required to hire an additional assistant manager at an additional expense to Defendant. Defendant determined that this accommodation was not reasonable, and it offered to Hedican the option to apply for an hourly supervisory position in which he could more definitely choose his hours. Hedican declined the offer to apply for the supervisory position, and filed a charge of discrimination with the EEOC. The District Court granted Defendant’s motion for summary judgment on the grounds that Defendant’s offer for Hedican to apply for an hourly supervisor position that did not require mandatory weekend shifts would be reasonable under the guidelines of Title VII. On appeal, the Seventh Circuit affirmed the District Court’s ruling. The Seventh Circuit agreed that Title VII does not require an employer to force other managers to switch shifts with other salaried assistant managers, and requiring so would shift the duty to accommodate from Defendant onto other those other workers. The Seventh Circuit determined that if it were to rule that Defendant must revise its policy of a rotating-shift scheme for assistant managers, it would necessarily impose more than a slight burden on the company. For these reasons, the Seventh Circuit affirmed the District Court’s ruling that granted Defendant’s motion for summary judgment. (viii) Eighth Circuit EEOC v. Schuster Co., 2021 U.S. Dist. LEXIS 79815 (N.D. Iowa April 13, 2021). The EEOC filed an enforcement action alleging that Defendant’s use of an isokinetic strength test (the “CRT Test”) had a disparate impact on female job applicants in violation of Title VII of the Civil Rights Act. Id . at *3. Following discovery, the parties filed cross-motions for summary judgment, which the Court denied. In its motion, the EEOC asserted that from June 2014 to present, Defendant violated Title VII by refusing to hire women who failed a preemployment physical test that had a disparate impact on women. In support of its motion for summary judgment, the EEOC’s cited its expert’s opinion that Defendant’s use of the CRT test had a statistically significant adverse, disparate impact on women. The EEOC argued that Defendant could not raise an issue of fact as to whether the CRT test was job-related and consistent with business necessity when: (i) it could not explain how the test was scored or whether the passing score related to the physical demands of the job; (ii) the test did not accomplish Defendant’s stated goals of reducing workers’ compensation injuries or costs; and (iii) Defendant retained incumbent drivers who failed the test. Id . at *4. Finally, the EEOC asserted that Defendant hired many males who failed the CRT test, but refused to hire more than two dozen women who failed the test, yet scored higher than the males who passed. In Defendant’s motion for summary judgment, it argued it was entitled to summary judgment because: (i) the CRT test did not have a disparate impact on female applicants for the position of truck driver; (ii) it was entitled to use a physical abilities test that had been validated; (iii) its use of the CRT test was job-related and consistent with business necessity; and (iv) the EEOC failed to demonstrate the existence of reasonable alternatives that would effectively serve Defendant’s needs while resulting in hiring more female applicants. Id . at *5. The EEOC’s expert, a labor economist, opined that during the period of June 2, 2014 to February 10, 2020, 95% of CRT tests taken by male conditional hires to the driver position received a passing score, whereas only 76.6% of tests taken by female conditional hires to the driver position received a passing score. Id . at *6-7. Defendant relied on the “4/5 Rule,” which states that “a selection rate for any race, sex, or ethnic group which is less than four-fifths (4/5) (or 80%) of the rate for the group with the highest rate will generally be regarded by the Federal enforcement agencies as evidence of adverse impact, while a greater than four-fifths rate will generally not be regarded by Federal enforcement agencies as evidence of adverse impact.” Id . Defendant argued that the EEOC did not establish that its use of the CRT test had a disparate impact on female conditional hires. Analyzing Defendant’s application of the “4/5 Rule,” the Court held there was no dispute that the employer met the test, since even the EEOC’s expert noted that 95% of males passed, while only 76.6% of females passed. Id . at *8-9. However, the Court also held that Defendant overreached in applying the 4/5 Rule because: (i) it ignored the part of the rule indicating, “[s]maller differences in selection rate may nevertheless constitute adverse impact, where they are significant in both statistical and practical terms or where a user’s actions have discouraged applicants disproportionately on ground of race, sex, or ethnic group;” (ii) Defendant’s own calculations were just above 80% and barely met the 4/5 Rule; and (iii) although the “4/5 Rule” is generally a benchmark, both the U.S. Supreme Court and EEOC have emphasized that courts should