GREENAWAY, JR., Circuit Judge.
Gregory Meditz ("Meditz"), an attorney proceeding pro se, appeals from the District Court's grant of summary judgment in favor of the City of Newark ("Newark") on his claim of disparate impact
In April 2007, Meditz, a white male, applied for the position of Housing Development Analyst in Newark. He was rejected in July 2007 because, at the time, he lived in Rutherford, New Jersey.
In support of his prima facie case, Meditz provided detailed statistical information in opposition to Newark's motion for summary judgment. Meditz obtained the statistical information from publicly available reports. Newark does not dispute the validity of any of the statistics Meditz presented. These statistics compared the ethnic distribution of non-uniformed employees to the ethnic makeup of Newark.
Newark argues that the statistics presented by Meditz do not support his prima facie case, since "the statistical disparities are not sufficiently substantial as to show that the residency ordinance has caused whites of non-Hispanic origin to be excluded from jobs with [Newark] because of their race." (Br. of Def.-Appellee City of Newark 10.)
Alleging that the relevant labor market was the six county area surrounding Newark, Meditz also provided the ethnic breakdown of the general population in the surrounding counties, all of which included higher percentages of white, non-Hispanics than were employed as non-uniformed employees in Newark.
The District Court granted Newark's motion for summary judgment, concluding that Meditz failed to prove his prima facie case. That is, based on the statistical evidence Meditz presented, the District Court concluded that "these statistics, standing alone, do not constitute sufficient evidence of a significantly discriminatory hiring pattern." In re Meditz v. City of Newark, No. 08-2912, 2010 WL 1529612, at *3 (D.N.J. Apr. 15, 2010). The District Court further concluded that there was no need to look beyond Newark's borders to define the relevant labor market, since "Newark is New Jersey's largest city with over 270,-000 residents, 38,950 of whom are White. Given its diversity and large population, there is no need to redefine the relevant labor market past city limits for purposes of Title VII analysis." Id. at *4. We disagree with both conclusions of the District Court.
II. Jurisdiction and Standard of Review
The District Court had jurisdiction under 28 U.S.C. § 1331; we have jurisdiction under 28 U.S.C. § 1291.
We review the District Court's order granting summary judgment de novo. Azur v. Chase Bank, USA, Nat'l Ass'n, 601 F.3d 212, 216 (3d Cir.2010). "To that end, we are required to apply the same test the district court should have utilized initially." Chambers ex rel. Chambers v. Sch. Dist. of Phila. Bd. of Educ., 587 F.3d 176, 181 (3d Cir.2009) (internal quotation marks omitted).
Summary judgment is appropriate "where the pleadings, depositions, answers to interrogatories, admissions, and affidavits show there is no genuine issue of material fact and that the moving party is entitled to judgment as a matter of law." Nicini v. Morra, 212 F.3d 798, 805-06 (3d Cir.2000) (en banc) (citing Fed.R.Civ.P. 56(c)).
Meditz claims that Newark's residency requirement for non-uniformed employees has a disparate impact on white, non-Hispanics in violation of Title VII. In support of his claim, he cites evidence of the relatively low percentage of white, non-Hispanics in Newark's non-uniformed work force. The statistics he provides demonstrate that the percentage of white, non-Hispanics in Newark's non-uniformed work force is lower than the percentage that would be anticipated based on the percentage of white, non-Hispanics in the population of the relevant labor market.
Title VII makes it unlawful "to discriminate against any individual with respect to his compensation, terms, conditions, or privileges of employment, because of such individual's race, color, religion, sex, or national origin." 42 U.S.C. § 2000e-2(a)(1). The Supreme Court has long recognized that Title VII plaintiffs can make out a viable employment discrimination claim without alleging or proving discriminatory intent. See Griggs v. Duke Power, 401 U.S. 424, 91 S.Ct. 849, 28 L.Ed.2d 158 (1971). Under Title VII, "practices, procedures, or tests neutral on their face, and even neutral in terms of intent, cannot be maintained if they operate to `freeze' the status quo of prior discriminatory employment practices." Griggs, 401 U.S. at 430, 91 S.Ct. 849.
"The [Supreme] Court announced that these `disparate impact' cases should proceed in two steps: (1) the plaintiff must prove that the challenged policy discriminates against members of a protected class, and then (2) the defendant can overcome the showing of disparate impact by proving a `manifest relationship' between the policy and job performance. This second step came to be known as the `business necessity' defense, and it serves as an employer's only means of defeating a Title VII claim when its employment policy has a discriminatory effect." El v. SEPTA, 479 F.3d 232, 239-40 (3d Cir.2007) (footnotes omitted.) "[T]he successful assertion of the business necessity defense is not an ironclad shield; rather, the plaintiff can overcome it by showing that an alternative policy exists that would serve the employer's legitimate goals as well as the challenged policy with less of a discriminatory effect." Id. at 240 n. 9.
Thus, "[i]n order to establish a prima facie case of disparate impact discrimination, a plaintiff is required to demonstrate that application of a facially neutral standard has resulted in a significantly discriminatory hiring pattern." N.A.A.C.P. v. Harrison, 940 F.2d 792, 798 (3d Cir.1991) (citing Dothard v. Rawlinson, 433 U.S. 321, 329, 97 S.Ct. 2720, 53 L.Ed.2d 786 (1977)). "The evidence in these `disparate impact' cases usually focuses on statistical disparities." Watson v. Fort Worth Bank and Trust, 487 U.S. 977, 987, 108 S.Ct. 2777, 101 L.Ed.2d 827 (1988). "A comparison between the racial composition of those qualified persons in the relevant labor market and that of those in the jobs at issue typically `forms the proper basis for the initial inquiry in a disparate impact case.'" Harrison, 940 F.2d at 798 (quoting Wards Cove Packing Co., Inc. v. Atonio, 490 U.S. 642, 650-51, 109 S.Ct. 2115, 104 L.Ed.2d 733(1989) (superceded by statute on other grounds)).
However, a key factor in assessing the statistics is ensuring that the court is using the correct basis for comparison. That is, "[w]hat the hiring figures prove obviously depends upon the figures to which they are compared." Hazelwood, 433 U.S. at 310, 97 S.Ct. 2736.
Similarly, we have addressed the question of what constitutes the relevant labor market. In Harrison, the Third Circuit examined Harrison's employment related residency requirement, and that policy's impact on the city's ability to hire minorities. Given that the city of Harrison had a very small minority population, limiting
Here, in support of his prima facie case, Meditz offered statistical evidence showing that the percentage of white, non-Hispanics employed by Newark was lower than the percentage of white, non-Hispanics in the general population of Newark. Meditz also offered statistics showing the percentage of white, non-Hispanics in surrounding areas, both for the general population and for the private and government work forces. Finally, Meditz offered evidence of the percentage of white, non-Hispanics employed by the Essex County government in Newark. Out of all of these percentages, the lowest was the percentage of white, non-Hispanics employed by the city of Newark. This compilation of statistics supported Meditz's claim that white, non-Hispanics were under-represented in Newark's non-uniformed work force.
The Supreme Court has set forth standards to be used as a basis for evaluating statistical evidence in disparate impact claims. Relying on the statistical standards developed in jury analysis cases, the Supreme Court suggested that "fluctuation of more than two or three standard deviations would undercut the hypothesis that decisions were being made randomly with respect to race." Hazelwood, 433 U.S. at 311 n. 17, 97 S.Ct. 2736.
Before the District Court can reach the statistical analysis, it must make a determination as to the parameters of the relevant labor market. See Hazelwood, 433 U.S. at 313, 97 S.Ct. 2736. In conducting this analysis, the District Court should consider the factors set forth in Harrison, including geographical location, flow of transportation facilities, locations from which private employers draw their workforce, and commuting patterns.
In Harrison, this Court concluded that the factors considered by the district court in determining what geographical area constituted the relevant labor market were reasonable. 940 F.2d at 801. The District Court here focused on the fact that the population of Harrison, at the time of this Court's decision in that case, included few blacks, and Harrison employed no blacks. By comparison, according to the District Court here, the fact that Newark employed 180 white, non-Hispanics, far more than Harrison's employment of zero blacks, sufficed to demonstrate a lack of discrimination.
The District Court misinterpreted Harrison. Rather than reading Harrison as setting forth appropriate criteria to consider in determining the relevant labor market, the District Court read Harrison to stand for the proposition that the only
We will remand so that the District Court can determine the relevant labor market, relying on the criteria set forth in Harrison, and then conduct a complete and correct statistical analysis,
To the extent the District Court concluded that, even if Meditz established a prima facie claim of disparate impact, Newark is still entitled to summary judgment because the city has met the requirements of the business necessity defense, we further reverse the Court on this point. We agree with Meditz that the District Court applied the incorrect standard.
The District Court focused only on whether the business justifications offered by Newark had any connection to the residency policy even if unrelated to Meditz's ability to perform the job in question. The District Court mistakenly relied on this court's opinion in Harrison that in turn relied on the Supreme Court's definition of business justification in Wards Cove. The Civil Rights Act of 1991 abrogated the decision in Wards Cove, and returned the business necessity defense to the standard that existed prior to the date of the decision in Wards Cove, El, 479 F.3d at 241.
Since the enactment of the Civil Rights Act of 1991, we have not had the occasion to consider the business necessity defense in a case involving a challenge to an employment related residency requirement. However, in El, we carefully considered the evolution of the business necessity defense, and concluded "that hiring criteria must effectively measure the `minimum qualifications for successful performance of the job in question.' This holding reflects the Griggs/Albemarle/Dothard rejection of criteria that are overbroad or merely general, unsophisticated measures of a legitimate job-related quality. It is also consistent with the fact that Congress continues to call the test `business necessity,' not `business convenience' or some other weaker term." El, 479 F.3d at 242 (quoting Lanning v. SEPTA, 181 F.3d 478, 481 (3d Cir.1999)).
It is this standard, and not the standard set forth in Harrison, that the District Court must address on remand. We note that even under the "diluted"
Based upon our de novo review, we conclude that summary judgment was not appropriate on this record. Factual issues exist as to how to define the appropriate relevant labor market. Even if the city of Newark itself is the relevant labor market, the District Court erred in its statistical analysis. Further, the District Court applied the incorrect standard when analyzing the business necessity defense. On remand, the correct standard should be considered. We will remand this case for further proceedings consistent with this opinion.