This post is part of Challenging Precedent, a blog of the Stanford Center for Racial Justice examining race, law, and regulation in the Trump era.
During the first months of the Trump administration, the president issued an unprecedented number of executive orders. One of them, “Restoring Equality of Opportunity and Meritocracy,” rejected the legal theory of disparate impact that for more than half a century has been a part of anti-discrimination law in the United States.
Endorsed by the Supreme Court in its 1971 decision in Griggs v. Duke Power Company, the disparate impact theory allows for a finding of wrongdoing in violation of the law based on discriminatory outcomes, even in the absence of proof of discriminatory intent. The disparate impact approach was subsequently codified by Congress and became one basis for enforcing anti-discrimination law across a wide range of settings, including employment, housing, education, and with respect to federally-funded programs.
The Trump executive order describes disparate impact doctrine as a dangerous device that would “transform America’s promise of equal opportunity into a divisive pursuit of results preordained by irrelevant immutable characteristics.” The executive order portrays the disparate impact approach as necessarily contrary to meritocracy and its premise that people should advance based not on group membership but instead based on their own efforts and talents.
There is legitimate reason for the Trump administration’s concern about disparate impact, but its wholesale rejection of the approach is overwrought and misguided.
Critics of disparate impact liability justifiably worry that some proponents of the approach view it as a license to reject policies and practices solely because they lead to uneven outcomes among groups. For example, some commentators urge selective universities to abandon reliance on standardized test scores in their admissions process, because African Americans and Latinos tend to score lower on such tests than Asian American or White applicants. This approach resonates with the idea of anti-racism, which became enormously popular during the last several years. Ibram Kendi, its most visible proponent, has made clear his view that formally race neutral practices (like reliance on test scores) should be rejected simply because they yield racially uneven outcomes. But trying to equalize group outcomes at the expense of all other considerations is a bad idea. Disparate impact should not be viewed as a means of socially engineering society.
But the fact that some commentators might view disparate impact as a means of resetting group outcomes is not sufficient justification for the wholesale rejection of the approach. The disparate impact approach is protean and performs two other important functions, each of which the Trump administration has embraced. Disparate impact provides a means of ferreting out covert discrimination when there is insufficient evidence to satisfy the standard of proof for intentional discrimination.
Consider, for example, the facts in Griggs v. Duke Power Company, the case where the Supreme Court first endorsed the disparate impact approach. The defendant in the case, North Carolina’s Duke Power Company, had openly discriminated against African Americans until the passage of the 1964 Civil Rights Act flatly prohibited such discrimination. The company then decided to assign people to jobs based on their scores on an intelligence test. African Americans, who under Jim Crow had been denied access to quality schooling, unsurprisingly performed less well than Whites on the tests, and thus were unable to access the good jobs. Noting that scores on such tests had never been shown to predict job performance at the company and that many White employees performed well in the good jobs despite never satisfying either requirement, the Supreme Court struck down the intelligence test criterion. (The Court also invalidated a high school diploma requirement, which similarly disadvantaged African Americans.)
It’s easy to see the employer in Griggs as using the intelligence test (and the high school diploma requirement) to do indirectly what the Civil Rights Act prohibited the employer from doing directly: exclude Black employees from good jobs. Such indirect discrimination would have escaped prohibition were it not for the disparate impact approach, which allows courts to inquire into the justification for practices that disproportionately disadvantage entire groups.
More recently, the Trump administration has (perhaps unintentionally) invoked the disparate impact approach itself. The administration has done so in furtherance of its suspicion that America’s elite universities are discriminating against conservatives in the admission of students and the hiring of faculty. The administration has called on universities to make available their hiring and admissions records, so that it can investigate whether the hiring or admissions process disproportionately screens out members of certain groups. This is the disparate impact approach in action, plain and simple. The Trump administration is acting based on the belief that covert forms of discrimination are difficult to prove without looking at the sort of outcomes to which disparate impact directs attention. If that’s a justifiable use of the disparate impact approach, it is difficult indeed to see why the approach shouldn’t be used to ferret out discrimination against racial and ethnic minorities.
The third function that disparate impact serves is directly counter to the depiction of disparate impact in the Trump executive order. Far from necessarily furthering some vision of equal group outcomes, disparate impact can nudge institutions toward more meritocratic decision-making. Giving employers unfettered freedom to hire on whatever basis they want may result in nepotism and other undeniably non-meritocratic practices. Indeed, one important effect of the Civil Rights Act of 1964 was to undermine the “old boys’ network” that had long shaped access to economic opportunity, while excluding talented women and minorities from positions in which they could excel.
While critics of disparate impact often fixate on its attention to outcomes, it is important to note that unequal outcomes do not by themselves warrant invalidation of a challenged practice. In Griggs, for example, recall that the Supreme Court noted that the hiring criteria that disproportionately excluded Black applicants had not been shown to bear any relation to successful performance on the job. Standards that are demonstrably related to job performance are permissible, notwithstanding their disparate impact. To the extent the threat of disparate impact liability encourages employers and institutions to discard irrelevant criteria and instead adopt only standards that further legitimate institutional goals, disparate impact is a pro-meritocracy policy. It unsettles the status quo bias that might lead to institutional inertia, even when longstanding practices do not evaluate individuals based on their efforts and talents. Disparate impact prompts employers and other institutions to not unthinkingly exclude talented people from opportunities in the workplace and elsewhere. A proponent of meritocracy, as President Trump claims to be, should embrace such a use of disparate impact.
The Trump administration is correct that the threat of disparate impact liability encourages institutions to consider the effects of potential policies on identifiable groups, based not only on race, but also sex, age, disability, and pregnancy. Granting attention to the effects of a potential policy on such groups may be costly in terms of both time and money, and it may be in tension with the ideal that institutional decision-making should be blind to group identity. But the costs of the disparate impact approach have to be balanced against its benefits.
The federal government is especially well positioned to shape the use of disparate impact. In 2001, the Supreme Court took away the right of individuals to challenge certain government programs based on disparate impact. As a result, disparate impact doctrine in some circumstances can be enforced by the federal government, but not by individuals who feel aggrieved.
The Trump administration would have done well to recognize disparate impact as a useful tool rather than seeing it as a problem.
Ralph Richard Banks is the Jackson Eli Reynolds Professor of Law and Co-Founder and Faculty Director of the Stanford Center for Racial Justice.
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