USCA1 Opinion
July 14, 1995
[Not for Publication] [Not for Publication]
United States Court of Appeals United States Court of Appeals
For the First Circuit For the First Circuit
____________________
No. 95-1046
RONALD E. GRAFFAM, ET AL.,
Plaintiffs, Appellants,
v.
SCOTT PAPER COMPANY, ET AL.,
Defendants, Appellees.
____________________
APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MAINE
[Hon. Gene Carter, U.S. District Judge] ___________________
____________________
Before
Boudin, Circuit Judge, _____________
Coffin, Senior Circuit Judge, ____________________
and Stahl, Circuit Judge. _____________
____________________
Gerald F. Petruccelli, with whom James B. Haddow, Daniel W. _______________________ _________________ __________
Bates, Francis M. Jackson, and Petruccelli & Martin, were on brief for _____ __________________ ____________________
appellants.
William J. Kayatta, Jr., with whom Catherine R. Connors, B. __________________________ ______________________ __
Simeon Goldstein, and Pierce, Atwood, Scribner, Allen, Smith & _________________ _____________________________________________
Lancaster, were on brief for appellees. _________
____________________
____________________
STAHL, Circuit Judge. Following a nine-day bench STAHL, Circuit Judge. _____________
trial, the district court entered judgment for defendants
Scott Paper Company and S.D. Warren Company (collectively
"Warren") in this age discrimination suit brought by eleven
former employees ("plaintiffs"). The plaintiffs alleged that
the selection procedures ("selection procedures") used by
Warren to reduce by twenty percent the number of salaried
employees at its paper mill in Westbrook, Maine, effected an
illegal disparate impact on employees over age fifty. In
awarding judgment to Warren, the district court found that,
though the selection procedures did indeed have a disparate
impact on older-age employees, Warren had made a sufficient
showing that the procedures were job related and consistent
with business necessity. Graffam v. Scott Paper Co., 870 F. _______ _______________
Supp. 389, 399-404 (D. Me. 1994). After a careful review of
the record, we affirm.
I. I. __
Background Background __________
In late 1990, Warren concluded that it must reduce
by twenty percent its salaried work force of approximately
471 employees at its mill in Westbrook, Maine. The
conclusion was dictated, at least in part, by Warren's
decision to sell the mill and a corresponding requirement
that the mill be made more attractive to potential buyers.
Consequently, Warren set about creating selection procedures
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for identifying which employees it would need to discharge in
order to meet the desired force reduction goal.
In January 1991, a Mill Leadership Team ("MLT"),
consisting of the heads of several departments and the
manager of the Westbrook mill, met for a number of days to
develop a plan for achieving Warren's reduction goal. As a
result, each department identified job functions and job
positions that could be eliminated. Department heads divided
the jobs in each department -- including those to be
eliminated -- into specific job groups and placed salaried
employees subject to the downsizing into the newly-formed
groups. Positions with similar functions and
responsibilities were grouped together so that employees with
comparable skills ultimately would be rated against each
other.
At the same time, MLT members collectively defined
the selection procedures. As their starting point, the MLT
modified procedures previously developed by Warren's
corporate offices for use in an employee downsizing. MLT
members reviewed drafts of these selection procedures, sought
to understand and clarify the assessment criteria, and
discussed the applicability of the criteria to the Westbrook
mill. After the revisions were included, MLT members tested
the new procedures by conducting mock assessments of persons
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known to the MLT members but who were not subject to
discharge.
The final assessment plan allocated a total of 100
points to seven criteria: technical job skills (twenty
points); performance (ten points); length of service (ten
points); leading-change skills (fifteen points);
interpersonal skills (fifteen points); self management (ten
points); and versatility (twenty points). The skills
included in the technical job skill criterion varied for each
individual job group. An individual who received zero
technical skill points would not be retained in favor of
another employee with a higher technical skill rating
regardless of which employee had the higher respective total
assessment score. Every employee was awarded the maximum ten
performance points, provided that the employee had not
received counselling for unacceptable job performance. The
common criteria of length of service and leading-change,
interpersonal, self-management, and versatility skills
("common criteria") were applied identically to all employees
across all job groups.
Once the MLT finished ironing out the revised
assessment criteria, teams of at least three individuals were
formed to evaluate the salaried employees subject to
downsizing. Each team included an MLT member who had
participated in developing and discussing the written
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criteria, and at least one person who possessed substantial
first-hand knowledge regarding the skills and past
performance of each employee assessed. Every assessor was
provided a text explaining the assessment criteria and a list
of technical job skills applicable to the particular job
group he or she would assess. The teams reached a final
consensus rating for each employee through oral discussion
and group decision. Following the team assessments, MLT
members met to review the process. Additionally, each
department head was required to present, explain, and justify
the results of the selection process in his or her department
to a corporate review team that included management personnel
from the mill's corporate headquarters.
The downsizing process resulted in the termination
of thirty-nine percent of the salaried employees age fifty
years and older but only nine percent of those employees
under age fifty. All of the plaintiffs in this case were
over age fifty when Warren discharged them as a result of the
downsizing effort. Following their discharge, the plaintiffs
commenced this action in federal district court, alleging
that Warren had discriminated against them on account of
their age in violation of the Age Discrimination in
Employment Act of 1967 ("ADEA"), 29 U.S.C. 621-34, and
Maine state law. At trial, plaintiffs, pursuing their claim
under a theory of disparate impact liability, maintained that
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the selection procedures, though neutral on their face,
effected a substantial disparate impact on older-age
employees. Following a nine-day bench trial, the district
court entered judgment for Warren, from which the plaintiffs
now appeal.
II. II. ___
Discussion Discussion __________
A. Standard of Review ______________________
We review the district court's findings of fact
only for clear error. See Fed. R. Civ. P. 52(a); Cumpiano v. ___ ________
Banco Santander P.R., 902 F.2d 148, 152 (1st Cir. 1990). _____________________
Clear error exists when, after reviewing the entire record,
we have a "strong, unyielding belief that a mistake has been
made." Cumpiano, 902 F.2d at 152; see also Industrial Gen. ________ ___ ____ _______________
Corp. v. Sequoia Pac. Sys. Corp., 44 F.3d 40, 43 (1st Cir. _____ ________________________
1995). If, however, the district court premised its factual
findings on an incorrect view of the law, we are not bound by
the clearly erroneous standard. E.g., Brown Daltas & Assocs. ____ ______________________
v. General Accident Ins. Co., 48 F.3d 30, 36 (1st Cir. 1995). _________________________
"[T]o the extent that findings of fact can be shown to have
been predicated upon, or induced by, errors of law, they will
be accorded diminished respect on appeal." Dedham Water Co. _________________
v. Cumberland Farms Dairy, Inc., 972 F.2d 453, 457 (1st Cir. ____________________________
1992).
B. Age Discrimination Claim ____________________________
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The plaintiffs contend that Warren's selection
procedures, though neutral on their face, resulted in the
discharge of a disproportionate number of older-age
employees. The theory of disparate impact liability has its
roots in the Supreme Court's decision in Griggs v. Duke Power ______ __________
Co., 401 U.S. 424 (1971). In Griggs, the Court held that the ___ ______
use of a facially neutral objective test that tended
disproportionately to exclude African-Americans from the
employment pool but did not measure skills demonstrably
related to job performance violated Title VII's anti-
discrimination provisions. In the context of Title VII,
Congress codified the disparate impact theory in the Civil
Rights Act of 1991. See Pub. L. No. 102-166, 3, 105 Stat. ___
1071 (1991) (listing as one of its purposes "to confirm
statutory authority and provide statutory guidelines for the
adjudication of disparate impact suits under title VII").
Congress, however, has never explicitly addressed
the theory of disparate impact liability in the ADEA context.
Moreover, though the Supreme Court has acknowledged that
"[t]here are important similarities between [Title VII and
the ADEA], . . . both in their aims -- the elimination of
discrimination from the workplace -- and in their substantive
provisions[,]" Lorillard v. Pons, 434 U.S. 575, 584 (1978), _________ ____
it has nonetheless "never decided whether the disparate
impact theory of liability is available under the ADEA."
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Hazen Paper Co. v. Biggins, 113 S. Ct. 1701, 1706 (1993). _______________ _______
Similarly, though we assumed without analysis the
applicability of the theory in Holt v. Gamewell Corp., 797 ____ _______________
F.2d 36, 37 (1st Cir. 1986), we have never directly addressed
the issue. See also Caron v. Scott Paper Co., 834 F. Supp. ___ ____ _____ _______________
33, 35-38 (D. Me. 1993). Again, for purposes of this
opinion, we assume arguendo that the district court correctly ________
held that the ADEA supports a claim for age discrimination
based on a disparate impact theory of liability.1
As applied in Title VII cases, to prove a claim of
disparate impact discrimination, a plaintiff must identify a
facially neutral employment practice or policy that causes a
statistically discernible disparate impact on a protected
____________________
1. Though admittedly addressing only the issue of disparate
treatment, the Hazen Court arguably cast some doubt on the _____
viability of a disparate impact claim under the ADEA by
holding that "[w]hen the employer's decision is wholly
motivated by factors other than age, the problem of
inaccurate and stigmatizing stereotypes disappears. This is
true even if the motivating factor is correlated with age . .
. ." Hazen, 113 S. Ct. at 1706. Taking note of this _____
language, two of our sister circuits have recently questioned
whether the theory of disparate impact liability applies to
the ADEA. See DiBiase v. Smithkline Beecham Corp., 48 F.3d ___ _______ ________________________
719, 732 (3d Cir. 1995) (plurality) ("[I]n the wake of Hazen, _____
it is doubtful that traditional disparate impact theory is a
viable theory of liability under the ADEA."); EEOC v. Francis ____ _______
W. Parker School, 41 F.3d 1073, 1076-78 (7th Cir. 1994), _________________
cert. denied, 1995 U.S.L.W. 3887 (U.S. June 19, 1995) (No. _____ ______
94-1558); but see Houghton v. Sipco, Inc., 38 F.3d 953, 958- ___ ___ ________ ___________
59 (8th Cir. 1994) (assuming without analysis the
applicability of disparate impact theory of liability to the
ADEA). See also Michael C. Sloan, Comment, Disparate Impact ___ ____ ________________
in the Age Discrimination in Employment Act: Will the _____________________________________________________________
Supreme Court Permit It?, 1995 Wis. L. Rev. 507 (1995). ________________________
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employee group. See EEOC v. Steamship Clerks Union, Local ___ ____ ______________________________
1066, 48 F.3d 594, 601 (1st Cir. 1995). Once the plaintiff ____
has made this initial showing, the defendant must then
attempt to debunk the sufficiency of the plaintiff's evidence
or, in the alternative, show that the challenged practice is
either job related and consistent with business necessity or
that it fits within a specific statutory exception.2 Id. at ___
604. If the employer attempts to justify its actions, the
plaintiff may seek to cast doubt on the justification by
showing, inter alia, an alternate practice exists that _____ ____
equally protects the employer's putative interest but does
not disproportionately burden employees in the protected
class. Id. ___
The plaintiffs contend that the district court
found that the selection procedures merely identified
qualities important for employees to possess in general.
They argue that such a finding is equivalent to measuring
"the person in the abstract" and not the "person for the
job," Griggs, 401 U.S. at 436, and, therefore, is inadequate ______
to establish an affirmative defense to a claim of disparate
____________________
2. The ADEA provides that an employer may take an otherwise
prohibited employment action if the action is predicated on
"reasonable factors other than age." 29 U.S.C. 623(f)(1).
The plaintiffs contend that, in the context of a disparate
impact claim, this defense is equivalent to Title VII's "job-
related/business-necessity" defense. Cf. 29 C.F.R. ___
1625.7(d) (interpreting the "reasonable factor other than
age" defense as limited only to factors justifiable as a
"business necessity").
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impact discrimination. The plaintiffs argue further that the
district court erred by failing to inquire whether Warren had
established that the selection procedures identified specific
job behaviors that significantly correlated to successful
performance of the specific jobs in question. They maintain
that, if the correct standard were to be applied, the
evidence is insufficient to support a finding in favor of
Warren. We disagree.
Our review of the district court's careful and
extensive opinion satisfies us that it did supportably find
that Warren's selection procedures measured skills and job
behaviors necessary for, and significantly correlated with,
successful performance of the jobs in question. The court
found that the common criteria used in the selection
procedures identified necessary technical and managerial
skills "important to all the rated jobs at the mill." To
support this finding, the court pointed to Warren's expert,
Dr. Richard S. Barrett, a consultant in the field of
industrial psychology, who testified at some length that the
common criteria described job behaviors required in
managerial and technical jobs in a manufacturing facility
such as the Westbrook mill. In addition, the court noted
that three department heads at the mill, who had participated
in designing and implementing the selection procedures,
testified that the common criteria fairly represented
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important skills needed to perform the jobs in their
departments. The court also relied on the testimony of
Warren's Human Resource Director, Gary Parafinczuk, who
explained, inter alia, that, prior to the downsizing, Warren _____ ____
had devoted money and resources to teaching and encouraging
the very skills assessed by the common criteria.
The district court also noted that the testimony of
the various department heads established that the technical
skills portion of the selection procedures (which differed
for each job group) identified important skills needed to
perform the specific jobs in each job group. Finally, in
discrediting the testimony of the plaintiff's expert, Dr.
James Mahoney, in favor of Dr. Barrett, the district court
expressly rejected the plaintiff's contention that the
selection procedures were not consistently predictive of, or
significantly correlated with, the necessary skills for the
successful performance of the specific jobs in question.
Notwithstanding the district court's careful
analysis, the plaintiffs contend that, because Warren applied
the same common criteria in equal weights to every job group
assessed, the selection procedures could not possibly measure
job skills significantly correlated with successful
performance of any specific job. We are not convinced: The
fact that the skills identified by the common criteria were
important in many managerial and technical mill jobs simply
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does not compel a finding that the skills were unrelated to
the particular jobs at issue. Furthermore, the plaintiffs
totally disregard the fact that the technical skills and
performance criteria directly measured each employee's
specific job performance skills and that, although Warren
applied the common criteria to all employees, the employees
were rated and ranked only within their specific job group by
persons familiar with individual employees and group needs.
Moreover, we seriously doubt that Warren would have
previously committed money and resources to developing the
skills measured by the common criteria if they were not
directly related to successful job performance. In addition,
the employees' own expert admitted on cross-examination that
one way to assess the validity of the selection procedures as
a tool for measuring skills directly related to job
performance would be to examine whether a statistical
correlation existed between earlier promotions at the mill
and the assessment scores. Subsequently, Dr. James Medoff,
an expert in labor statistics retained by Warren, testified
that, when he reviewed the data supplied by Warren, he found
a strong correlation between those two factors.
In sum, we believe that, in determining whether
Warren had sufficiently justified its use of the selection
procedures, the district court supportably found that the
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procedures measured skills necessary for, and correlated
with, successful performance of the jobs in question.3
We also believe that the record adequately supports
the district court's finding that Warren's implementation of
the selection procedures assured that they would fairly
identify the employees who most fully possessed the skills
and abilities needed for successful job performance. In
making this finding the court relied in part on Dr. Barrett's
assessment of Warren's efforts. Barrett testified that the
____________________
3. Furthermore, we do not think, on the facts of this case,
that the law necessarily required Warren to offer empirical
studies to validate the selection procedures as job related.
Such a requirement would place a substantial burden on
employers, like Warren, already forced by economic necessity
to reduce the size of their work force. See generally 29 ___ _________
C.F.R. 1607 (EEOC guidelines outlining empirical methods
for validating selection procedures in Title VII context).
Employers, however, are not required, "even when defending
standardized or objective tests, to introduce formal
`validation studies' showing that particular criteria predict
actual on-the-job performance." Watson v. Fort Worth Bank & ______ _________________
Trust, 487 U.S. 977, 999 (1988) (plurality); cf. id. at 1006- _____ ___ ___
7 (Blackmun, Brennan, Marshall, JJ., concurring) ("While . .
. formal validation techniques . . . may sometimes not be
effective in measuring the job-relatedness of subjective-
selection processes, a variety of methods are available for
establishing the link between these selection processes and
job performance, just as they are for objective-selection
devices." (footnote omitted)); Albemarle Paper Co. v. Moody, ___________________ _____
422 U.S. 405, 449 (1975) (Blackmun, J., concurring). Here,
the selection procedures are not objective tests employed to
screen potential job applicants, but instead are more akin to
subjective evaluations directly measuring actual abilities of
known employees. Moreover, there is no evidence in this case
that the procedures were used to "freeze" the effects of
prior intentional age discrimination. See Albemarle, 422 ___ _________
U.S. at 427 ("The question of job relatedness must be viewed
in the context of the plant's operation and the history of
the testing program.").
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team format for rating each employee, calling for open
discussion and justification of each assessment and consensus
decision-making, enhanced the quality of the rating system.
The court also pointed out that all raters who testified
stated that they understood the criteria and how to apply
them. Furthermore, the court noted that the post-rating
review sessions, at which each department head was required
to justify his or her decisions, further assured the quality
and fairness of the assessments. We have reviewed the record
and find that it adequately and convincingly supports the
district court's conclusions. Accordingly, the district
court's findings are not clearly erroneous.4
III. III. ____
Conclusion Conclusion __________
For the foregoing reasons, the judgment of the
district court is affirmed.
____________________
4. Warren additionally contends that the plaintiffs' appeal
should fail because, inter alia, they improperly used a _____ ____
subgroup (employees age fifty years and older) of the
protected class (employees age forty years and older) as the
basis for their disparate impact claim. Because we find no
error in the district court's factual findings, we do not
reach this argument.
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