Guest blogger Lorrie Ray of Mountain States Employers Council discusses the legalities of residency requirements and why public employers need to be careful.
Public employers sometimes require employees to live within certain areas to be employed. Such was the case for the regional fire district comprised of five Hudson County communities in New Jersey. It required fire district employees to be recruited from these communities. This hiring restriction resulted in only two of the 323 employees being African-American.
The NAACP sued the fire district for disparate impact race discrimination arguing that the residency pool was too limiting and was not justified by business necessity. The NAACP said that the pool should be expanded to include southern Hudson County, and Essex and Union counties, so that Black applicants could work as North Hudson firefighters in greater numbers.
The court initially held that the NAACP proved that the residency requirement had a disparate impact on Black applicants that could not be justified by business necessity. The decision was reversed, however, when Hispanic firefighter candidates who intervened in the case and said that changing the residency requirement would cause them to experience reverse discrimination. They successfully argued that it would go against the U.S. Supreme Court’s holding in Ricci v. DeStefano for the fire district to expand the residency pool to solve one discrimination concern only to create another.
The court recently changed its mind once again reinstating its previous decision that the residency requirement caused a racial disparate impact for Black applicants and was not “job related and consistent with business necessity.” NAACP v. North Hudson Regional Fire & Rescue (D.N.J. 2010).
The court made this decision despite the Hispanic applicants’ argument that fire district also has a duty to stop reverse discrimination. The court reasoned that the fire district “would not be expanding the residency requirement because of race-based statistics alone; it would be expanding the list because the residency requirement causes a disparate impact that is not justified by business necessity.”
It will be interesting to see if this decision stands or is reversed again. In any case, public employers with residency requirements should beware of the potential for disparate impact discrimination claims and assume that any residing requirement is based on business necessity.
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