In a 5-4 decision split along party lines, the U.S. Supreme Court ruled in favor of white and Hispanic New Haven firefighters in Ricci v. DeStefano . In 2004, the city threw out the results of a promotions test because no blacks scored high enough to qualify for promotions. The city claimed that had it certified the test results, it could have been sued by black firefighters under the disparate impact provision of Title VII of the Civil Rights Act. The District Court granted summary judgment for New Haven, and an appeals court on which Supreme Court nominee Sonia Sotomayor sits affirmed.
Reversing Sotomayor, Justice Anthony Kennedy contended that New Haven rejected the test results "solely because the higher scoring candidates were white" and added that "[f]ear of litigation alone cannot justify an employer's reliance on race to the detriment of individuals who passed the examinations and qualified for promotions."
The decision was based on an analysis of Title VII's disparate treatment and disparate impact provisions. New Haven intentionally discriminated against white firefighters (disparate treatment) to avoid liability for unintentional discrimination against black firefighters (disparate impact). And therein lies the problem. Even if a test is race-neutral, employers may be sued for disparate treatment if they discard test results based on race and disparate impact if minorities perform poorly on tests.
The problem began 38 years ago in a Supreme Court case called Griggs v. Duke Power Co. Black applicants disproportionately lacked required diplomas and/or failed the employment tests. The court held that for purposes of hiring, both requirements violated the Civil Rights Act. If an employment practice is "facially neutral," it's suspect if it has a disparate impact on members of a protected class, even if there's no discriminatory intent. To avoid liability, businesses would have to demonstrate that such tests are job-related and a justified business necessity.
Disparate impact puts employers in a bind. Unless all races score equally on racially neutral tests, they'll likely face litigation. Generally speaking, blacks tend to score lower on standardized tests than whites (which doesn't mean blacks deserve special treatment as a result), so as long as such tests are used, employers must lower standards (which also would benefit non-black test-takers) and/or manipulate the results to avoid lawsuits.