Monday, June 3, 2013

Sixth Circuit Revives 2003 Failure to Hire Claim, but Affirms Dismissal of Similar 2004 Claim and Class Certification Motion

Last week, the Sixth Circuit affirmed the denial of a class certification motion in a sexual discrimination hiring case and the dismissal of one claim of disparate treatment.  Davis v. Cintas Corp., No. 10-1662 (6th Cir. May 30, 2013).   However, the Court reversed dismissal of one claim of failure to hire on account of sex where the plaintiff was at least as qualified (if not more so) than the three other male candidates who were hired in the same 2003 time period, the defendant company only hired two females in six years, but 78 men in the same time period, and where statistical evidence showed that female applicants constituted 26% of the applicant pool and 35% of the qualified individuals in the surrounding population.

The Court made some interesting observations about Cintas national corporate hiring practices:

Service sales representatives were historically male. From June 1999 to October 2006, more than ninety percent of the managers charged with hiring service sales representatives were male. This overwhelmingly male group overwhelmingly hired males. After Cintas implemented the Meticulous Hiring System in 2003, however, female hiring rose dramatically. Between 1999 and 2002, the percentage of women hired for the service-sales-representative position never rose above seven percent. In 2003, the year corporate-level management instructed other managers to “put the myth that females cannot be SSRs out of [their] mind and hire more women SSRs,” and implemented the Meticulous Hiring System, that number rose to 7.8 percent. In 2004, it rose to 10.9 percent, and in 2005 it rose to 20.8 percent.

According to the Court’s opinion, the class certification motion could not survive the different facts of each potential claim of the class.   The trial court found that there was a conflict between the interests of the named and unnamed class members and the individualized determinations required at the damage phase was inappropriate for class action treatment.  There were many steps in the defendant employer’s hiring practices; some were subjective and some were not.  The female class members dropped out at different stages and for different reasons.   Relying heavily on the Supreme  Court’s decision in Wal–Mart Stores, Inc. v. Dukes, 131 S. Ct. 2541, 2562 (2011), the Court affirmed denial of class certification:

“[S]ubjective or discretionary employment practices may be analyzed under the disparate impact approach in appropriate cases.” Watson v. Fort Worth Bank and Trust, 487 U.S. 977, 991 (1988); accord Dukes, 131 S. Ct. at 2554. When plaintiffs challenge employment practices in a large, national corporation, however, “demonstrating the invalidity of one manager’s use of discretion will do nothing to demonstrate the invalidity of another’s.” Dukes, 131 S. Ct. at 2554. Unless a plaintiff can somehow show that the corporation’s managers all used “a common mode of exercising discretion that pervades the entire company,” Dukes explains, “[a] party seeking to certify a nationwide class will be unable to show that all the employees’ Title VII claims will in fact depend on the answers to common questions.” Id. at 2554–55.

The court in Dukes explained that the plaintiffs’ sociological, statistical, and anecdotal evidence—all of which was similar to the evidence offered here—was not sufficient to show a uniform, companywide practice of exercising discretion in a way that favored men over women. Applying the abuse-of-discretion standard, we affirm the district court’s determination that Davis’s statistical evidence, sociological analysis, and anecdotal accounts did not satisfy Rule 23(a)(2). As to each type of evidence, the district court weighed the parties’ competing arguments and found that Davis’s proffered evidence did not support a finding of companywide gender discrimination. We may not overturn this determination unless the district court “relie[d] on erroneous findings of fact, applie[d] the wrong legal standard, misapplie[d] the correct legal standard when reaching a conclusion, or ma[de] a clear error of judgment.” Pipefitters Local 636 Ins.Fund v. Blue Cross Blue Shield of Mich., 654 F.3d 618, 629 (6th Cir. 2011).

After all but one of the class members dropped out when the interlocutory appeal was denied, the remaining plaintiff claimed that she had been discriminated against on account of her sex when her applications for employment were rejected in 2003 and 2004.  The Court found that her poor score on the driving portion of the hiring process was a legitimate reason to deny her application in 2004 and she failed to show that the explanation was pretextual.  However, the Court found that she identified factual disputes in why she was dropped earlier in the hiring process in 2003.

The defendant employer explained that it dropped her early in the process in 2003 because she had mentioned that she disliked up-selling and wanted to keep her current part-time job.  The plaintiff showed that these reasons could be pretext because the employer ultimately moved further into the hiring process three men who were less qualified than her.    

Location 447 hired three men soon after interviewing Davis. At least on paper, their credentials appear equal to, or slightly less impressive than, Davis’s.  . . . . None of the three men had real-world experience in management; none had extensive experience in sales. Davis, by contrast, had worked as a manager for three different companies. She had significantly more customer-service and sales experience than any of the three male candidates, even if she disliked up-selling products and planned to continue working for LensCrafters part-time. She was, in other words, “as qualified or better qualified than [any of] the successful applicant[s].”

Moreover, Plaintiff’s expert explained:

“Between 1999 and 2004, 78 men were hired into SSR positions [at Location 447], but only 2 women were hired into these positions. All of the hires in the period from 1999–2002 were men. During 2003 and 2004, 32 hires occurred; 30 of these hires were men and 2 were women.” This was so, even though women accounted for between 26% and 27% of service-sales-representative applicants and 30% to 38% of the external labor market during that time period. “No women at all were hired into SSR jobs in Cintas location 447 for the four years prior to 2003.” From July 1, 2003 to December 31, 2004, “there were 27 hires into SSR positions. Only one of these hires (3.7% of the hires) was a woman even though more than 25% of these applicants were women.”

Although the employer’s experts claimed that the assumptions of plaintiff’s expert were flawed concerning the labor market, the Court held that this was a matter for the jury to decide.

In short, the statistical evidence and a comparison of the plaintiff’s application with those of the successful male candidates were sufficient to create a factual dispute for a jury to decide whether the failure to hire the plaintiff in 2003 was on account of her gender.

NOTICE: This summary is designed merely to inform and alert you of recent legal developments. It does not constitute legal advice and does not apply to any particular situation because different facts could lead to different results. Information here can change or be amended without notice. Readers should not act upon this information without legal advice. If you have any questions about anything you have read, you should consult with or retain an employment attorney.