Lead Opinion
Former employees of Entergy Corporation, Inc. sued Entergy and its subsidiaries for age discrimination on theories of disparate impact and disparate treatment. The case was tried to a jury for eighteen days, and after six days of deliberation the jury returned verdicts for Entergy on all the disparate impact claims and on all but five of the disparate-treatment claims.
Responding to anticipated deregulation and competition in the electric utility industry, Entergy developed an evaluation system that ranked employees in comparison to one another. Entergy’s prior evaluation system did not rate employees in relation to other employees, and it had produced too many high evaluations, resulting in most employees’ evaluation scores being grouped in the same small range. Under .the new evaluation system, immediate supervisors ranked the performance (ie., current job performance) and the potential (ie., potential to advance or assume greater responsibility) of each employee within their supervision. Employees within a peer group then were listed from best to worst as to performance and from best to worst as to potential. From these lists, employees were placed on a matrix that reflected their relative performance and potential, producing a ranking number for each employee. These results were progressively “rolled-up” through the company to compare employees to their peers company-wide. Each of the appellants received a low ranking despite satisfactory to excellent evaluations for the previous three years under the old evaluation system. Entergy conducted a preliminary adverse-impact analysis that determined the ranking system had an adverse impact on the basis of age, but not further analysis was performed.
In a parallel process, Entergy implemented a plan to reorganize its Independence and White Bluff coal-fired generating plants. The appellants were discharged pursuant to the subsequent reduction in work force at these plants. The managers of the two plants placed employees into the positions created by the reorganization after considering various factors, including the ranking numbers created by the new evaluation system. The appellants’ disparate-impact claims were based on the use of the ranking system to select employees to fill the reorganized positions. The appellants argued that the ranking system adversely affected older employees and that their low individual rankings caused them not to be selected for positions.
The disparate-impact claims were submitted to the jury on interrogatories. The
The appellants argue that the District Court
The appellants argue that the District Court erroneously instructed the jury in accordance with Wards Cove Packing Co. v. Atonio,
Entergy contends that the appellants did not properly preserve this claim of instructional error. We agree. “[T]o preserve an argument concerning a jury instruction for appellate review, a party must state distinctly the matter objected to and the grounds for the objection on the record.” Cross v. Cleaver,
After the District Court asked the appellants for their objections to the instructions, the following discussion occurred.
[ATTORNEY FOR PLAINTIFFS]: Instruction No. 10, we would object to the placing of the burden of proof on the plaintiffs to what we believe are still affirmative defenses of the defendants. Under the Age Discrimination Act the defendants have the burden of proving reasonable factors other than age as an affirmative defense and we would — they also have — we also think that they have the burden of proving why they did not use the alternative. We would like to proffer an alternative instruction under Albemarle Paper Company v. Moody.
THE COURT: I think we are down to Proffered Instruction J.
All right, I’m going to refuse the Plaintiffs’ Proffered Instruction J and overrule the objection to the Court’s Instruction No. 10. From my reading of the Eighth Circuit case law, which has not made a definitive ruling on who has the burden of proof on the issue of the reasonable alternative, my analysis of the law is that it would be unfair to place that burden on the defendants until ease law or statutory law has made it clear that there is a burden on the defendants to establish a reasonable alternative. And, therefore, the burden should be on the plaintiffs on this issue and that’s the way the instruction reads to the jury.
Trial Tr. at 73-74 (Apr. 24, 1997). From the objection and the District Court’s response, it is clear that all the appellants conveyed to the District Court was their objection as to the burden of proof on reasonable alternatives. The appellants argue that they objected to the burden of proof both as to reasonable alternatives and as to business necessity. They may have intended such an objection, but if so they utterly failed to state it distinctly so as to bring the nature of their objection into focus for the court. To preserve the alleged error for appeal, the appellants were required, during the jury instruction conference, to make a specific objection that distinctly stated the matter objected to and the grounds for the objection. The appellants’ objection did not use the terms “business necessity” or “business justification.” Even assuming the appellants’ objection is sufficiently general to encompass both reasonable alternatives and business necessity, a “general objection [is] insufficient to preserve the specific objections to the instruction” that appellants now argue. Dupre,
Because the appellants failed to make a timely and adequate objection regarding the business necessity issue, this Court reviews only for plain error. See Westcott,
As a second basis for reversal, the appellants argue that they should have been granted judgment as a matter of law on two grounds. First, the appellants argue the District Court erred by failing to rule that Entergy had not proven that use of the ranking system was a business necessity. This argument merely restates the appellants’ instructional argument regarding business necessity, which we already have addressed. Second, the appellants argue the District Court erred by failing to rule that Entergy had other selection devices, without a similar adverse impact on older employees, which would have served Entergy’s legitimate interests. The jury specifically found against the appellants on this matter, see Special Verdict Form No. 27 at 4, and we find no basis for reversing the jury’s verdict, which is one that on this record a reasonable jury could reach.
The appellants also argue the District Court erred by excluding certain evidence. We will not reverse a district court’s rulings on admissibility of evidence “absent a clear and prejudicial abuse of discretion.” Pittman v. Frazer,
The judgment of the District Court is affirmed.
Notes
. Entergy is not appealing the five judgments entered against it.
. The Honorable James M. Moody, United States District Judge for the Eastern District of Arkansas.
. If the employer meets its burden, whether the standard is to prove business necessity or to show business justification, the burden then shifts to "the complaining party to show that other tests or selection devices, without a similarly undesirable [impact on older workers], would also serve the employer's legitimate [business] interest[s].” Albemarle,
. We note that the Supreme Court has "never decided whether a disparate impact theory of liability is available under the ADEA," Hazen Paper Co. v. Biggins,
Dissenting Opinion
dissenting.
A careful reading of the record convinces me that appellants properly preserved their claim of instructional error. They sufficiently objected to the district court’s ADEA disparate-impact instruction, which applied the “business justifica
I.
The majority incorrectly concludes that appellants’ instructional error claim is procedurally barred. To preserve a claim of instructional error, the appealing party must state distinctly: (1) the matter objected to, and (2) the grounds for the objection. See Cross v. Cleaver,
During the instructional conference, appellants objected to Instruction No. 10, the court’s ADEA disparate-impact jury instruction, which applied the Wards Cove “business justification” analysis. The court’s instruction read:
Plaintiffs must prove that the application of a specific employment practice or procedure, while neutral on its face, caused a disparate impact on employees over 40 years old.
If plaintiffs demonstrate that a specific employment practice or procedure caused such a disparate impact, defendants must articulate a business justification for the use of such procedure. However, defendants need not persuade you that the justification exists. Rather, plaintiffs have the ultimate burden of proving the absence of a business justification, such that the use of the challenged procedure violated the Age Discrimination in Employment Act.
In deciding whether defendants had a business justification, you should consider whether the challenged procedure served, in a significant way, defendants’ legitimate employment goals. An insubstantial justification in this regard is not sufficient; however, it is not necessary that the challenged procedure was “essential” or “indispensable” to the defendants’ business.
Plaintiffs may also seek to prove that defendants were using the challenged procedure merely as a “pretext” for discrimination. In order to prove such a pretext, plaintiffs must prove that other procedures, without a similarly undesirable age discriminatory effect, would equally have served the defendants’ legitimate business interests. In determining whether an alternative would have been suitable in equally serving the defendants’ legitimate business interests, you should consider such factors as the cost of using the proposed alternative or other burdens associated with using the proposed alternative.
(Appellants’ App. at 23-24 (emphasis added).)
In response to the court’s instruction, appellants objected stating:
Instruction No. 10, we would object to the placing of the burden or proof on the plaintiffs to what we believe are still affirmative defenses of the defendants. Under the Age Discrimination Act the defendants have the burden of proving reasonable factors other than age as an affirmative defense and we would — they also' have — we also think that they have the burden of proving why they did not use the alternative.
(Tr. of Apr. 24, 1997, at 73-74 (emphasis added).)
Your verdict will be for plaintiffs, if the plaintiffs proved the following facts are more likely true than not true:
First, defendant has an employment policy or procedure, the ranking system, which may appear to be neutral on its face, but which actually results in employees 40 years of age or older being terminated at a substantially higher rate than employees under 40; (the plaintiff need not show that the employer was motivated by a discriminatory intent); and
Second, that plaintiffs were among the group who were terminated as a result of the application of this employment policy or procedure.
If the plaintiffs have failed to prove either one of these facts, then you will find for the defendant.
If you find that plaintiffs have proved these facts, then you will find for plaintiffs, unless defendant has proved that the policy or procedure is justified by a business necessity unrelated to age. A policy or procedure is justified by a business necessity if it is of substantial importance to the legitimate needs of defendant’s business and is necessary to achieve those needs.
A policy or procedure is not necessary to achieve defendant’s legitimate business needs if an alternative policy would serve those same needs while having a lesser impact on employees 40 years of age or older.
(Appellants’ App. at 25 (emphasis added).)
The court overruled appellants’ objection and rejected their proffered instruction. The court then ruled that the burden of proving reasonable alternatives, should be on the plaintiffs. (Tr. of Apr. 24,1997, at 74.)
The majority first concludes that appellants’ instructional error claim is procedurally barred because appellants objected only to bearing the burden of proving the absence of reasonable alternatives. According to the majority, appellants failed to object to the instruction’s use of the Wards Cove “business justification” standard, as opposed to the pre-Wards Cove “business necessity” standard. The majority’s reading of the record is unduly technical.
Appellants made not one, but two separate objections to the use of the “business justification” standard. First, appellants objected to the burden of proof on what they believed were affirmative defenses of the defendant. Under both the pre-Wards Cove and Wards Cove standards, once the plaintiff establishes a prima facie case of disparate impact, the defendant may raise an affirmative defense. Under the pre-Wards Cove standard, that defense is “business necessity.” See Kirby v. Colony Furniture Co.,
However, the burdens for these two defenses are different. The pre-Wards Cove standard places both the burdens of production and persuasion on the defendant to prove that the challenged practice is justified by a “business necessity.” See Kirby,
Second, appellants objected to bearing the burden of proving reasonable alternatives. Like their “affirmative defenses” objection, appellants’ “reasonable alternatives” objection goes to the heart of their instructional error claim. Under the pre-
The majority next concludes that even assuming appellants’ objection encompassed the use of the Wards Cove “business justification” standard, their claim is still barred because they failed to make clear that they objected on the ground that the 1991 Civil Rights Act overturned Wards Cove as applied to ADEA disparate-impact claims. Again, the majority’s reading of the record is overly technical.
A common-sense reading of the record leads me to conclude that, at the time of appellant’s objection, it was clear to all involved, including the district court, that appellants objected on the ground that Wards Cove was overruled by the 1991 Civil Rights Act.
In their briefs on defendants’ motion for summary judgment, both appellants and appellees fully argued the issue of whether the 1991 Civil Rights Act overruled Wards Cove for ADEA disparate-impact claims. (See Def.Br. in Supp.Summ.J. at 26-29; Pl.Br. in Opp.Summ.J. at 44-47.) Furthermore, the district court considered the issue during trial and determined that the 1991 Civil Rights Act did no overrule Wards Cove for ADEA disparate-impact claims and that the Wards Cove “business justification” standard applied. (Tr. of Apr. 16, 1997, at 48-49.) The fact that the matter was briefed, argued, and decided by the court clearly indicates that at the time of the objection all parties understood that appellants objected on the ground that the 1991 Civil Rights Act overruled Wards Cove for ADEA disparate-impact claims, and no further statement of the ground for the objection was necessary.
Finally, in its construction of the record, the majority fails to consider the policy behind the specific objection requirement. The purpose of the requirement is to “compel litigants to afford the trial court an opportunity to cure [a] defective instruction and to prevent litigants from ensuring a new trial in the event of an adverse verdict by covertly relying on the error.” Dupre,
Again the matter was fully briefed by the parties, providing the court with the opportunity to weigh the arguments and decide upon the applicable standard. Further, at the instructional conference, appellants twice objected to the use of the Wards Cove “business justification” standard, giving the court another opportunity to determine the applicable standard and correctly instruct the jury. Because the district court was afforded adequate opportunity to cure its defective instruction, the policy behind the specific-objection requirement was served.
A common-sense reading of the record reveals that appellants sufficiently objected to the court’s jury instruction applying the Wards Cove “business justification” standard, and that they did so on the ground that the 1991 Civil Rights Act overruled Wards Cove with regard to ADEA disparate-impact claims. Thus, appellants’ instructional error claim was preserved.
II.
Because appellants’ instructional error claim was preserved, I reach the substantive issue presented: whether the Civil Rights Act of 1991 overruled Wards Cove as it applied to ADEA disparate-impact claims.
It shall be unlawful for an employer
(1) to fail or refuse to hire or to discharge any individual or otherwise discriminate against any individual with respect to his compensation, terms, conditions, or privileges of employment because of such individual’s age;
(2) to limit, segregate, or classify his employees in any way which would deprive or tend to deprive any individual of employment opportunities or otherwise adversely affect his status as an employee, because of such individual’s age; or
(3) to reduce the wage rate of any employees in order to comply with this chapter.
29 U.S.C. § 623(a) (1999).
Similarly, Title VII reads:
It shall be an unlawful employment practice for an employer'—
(1) to fail or refuse to hire or to discharge any individual, or otherwise to discriminate against any individual with respect to his compensation, terms, conditions, or privileges of employment, because of such individual’s race, color, religion, sex, or national origin; or
(2) to limit, segregate, or classify his employees or applicants for employment in any way which would deprive or tend to deprive any individual of employment opportunities or otherwise adversely affect his status as an employee, because of such individual’s race, color, religion, sex, or national origin.
42 U.S.C. § 2000e-2 (1999).
In Griggs v. Duke Power Co.,
Given that the language of the ADEA was taken almost verbatim from Title VII, it is not surprising that courts soon began to recognize disparate-impact claims under the ADEA. See, e.g., Leftwich v. Harris-Stowe State College,
In 1989, the Supreme Court altered the Title VII disparate-impact standard by significantly lessening the defendant’s burden. The Court held that if the plaintiff established a prima facie case of disparate impact, only the burden of production shifted to the defendant to prove a “business justification,” rather than “necessity,” for the challenged practice. See Wards Cove,
Discontent with the Court’s narrow construction of Title VII led Congress to pass the 1991 Civil Rights Act to overrule Wards Cove. See 137 Cong.Rec. S15,277 (1991) (statement of Sen. Danforth) (“[F]or nearly two years many of us have been attempting to put together a civil rights bill that would redress problems created by the Supreme Court of 1989, particularly a bill that would reinstate the Griggs decision and that would overrule the Wards Cove decision. This amendment would do that.”). In its section-by-section analysis of the 1991 Civil Rights Act, the Senate stated that “the burden-of-proof issue that Wards Cove resolved in favor of the defendants is resolved by this Act in favor of plaintiffs,” and that “Wards Cove is thereby overruled.” See 137 Cong.Rec. S15,473 (1991). The Act’s legislative history in the
The Act’s legislative history clearly demonstrates that Congress intended that the 1991 Civil Rights Act overrule Wards Cove for Title VII disparate-impact claims. It is not clear from the language of the 1991 Civil Rights Act, however, whether it overruled Wards Cove for ADEA disparate-impact claims.
The 1991 Civil Rights Act mentions the ADEA and amends its statute-of-limitations provision and provisions directing the EEOC to provide notice to a claimant once the agency’s internal investigation is concluded. See Civil Rights Act of 1991, Pub.L. No. 102-106, § 115, 105 Stat. 1071 (1991) (codified at 29 U.S.C. § 626(d) (1999)). The Act is silent on the standard for analysis of ADEA disparate-impact claims. Appellees argue that this silence demonstrates that Congress did not intend to overrule Wards Cove as it applied to the ADEA. (Appellee’s Br. at 14.) I disagree.
First, the legislative history of the 1991 Civil Rights Act indicates that Congress intended that the Act overrule Wards Cove for ADEA disparate-impact claims. Congress stated that “remedial statutes, such as civil rights law, are to be broadly construed.” H.R.Rep. No. 102-40, pt. 2, at 34 (1991), reprinted in 1991 U.S.C.C.A.N. (105 Stat.) 727. The ADEA is a remedial statute intended to remedy age discrimination in employment. See Lorillard,
Second, the language of the ADEA does not specifically provide for disparate-impact claims. Such claims arise by analogy to Title VII using the same disparate-impact analysis. See Borden’s Inc., 724 F.2d at 1394-95; see generally Smith v. City of Des Moines,
III.
Because the pre-Wards Cove “business necessity” standard applies to ADEA disparate-impact claims, the district court erred by instructing the jury on the Wards Cove “business justification” standard. The court incorrectly placed the burden of persuasion on the plaintiffs at all times, leaving the defendant with only the burden of producing evidence justifying its use of the challenged ranking system. Because of its instructional error, the district court should be reversed and the matter remanded for a new trial.
