The U.S. Supreme Court handed employees and job applicants a victory by recognizing that, in a disparate impact (i.e., unintentional discrimination) case, the Title VII statute of limitations is measured from the employer's adoption and each subsequent use of an unlawful employment practice. Each use of an unlawful employment practice – such as multiple rounds of hiring based on a written test that has a disparate impact on minority applicants – is now considered a new violation of Title VII, which will make it easier for employees to file timely claims. Lewis v. City of Chicago.

As a result of this ruling, an employee or job applicant may file an EEOC charge even if more than 300 days have passed from the initial violation. This is bad news for employers, who may face an increased number of agency charges and lawsuits because impacted employees have a new time period after each violation to file an EEOC charge.

Facts Of The Case

In 1995, the City of Chicago administered a written test to firefighter job applicants. After the test was scored, the City divided the applicants into three categories based on their scores: "well qualified," "qualified," and "not qualified." These rankings had a disproportionate impact upon African-American applicants: white test-takers were five times more likely than African-American test-takers to be ranked "well qualified," despite the fact that the applicant pool was 45% white and 36% black.

The City notified applicants of the test results at the end of January 1996, and informed applicants that it planned to advance only those applicants in the "well qualified" category to the next steps in the hiring process. The City used the results approximately ten times during a six-year period, each time selecting a new class at random from the "well qualified" group. As a result, between 1996 and 2001, the City's entry-level firefighter hires were 77% white and 9% black – significantly different than the makeup of the applicant pool.

Six African-American applicants who took the test and were rated "qualified" filed EEOC charges, claiming that the test had a "disparate impact" on African-American applicants. Such a claim can be brought when, even though an employer does not make a conscious discriminatory decision (for example, "I'm firing you because you are black"), its decisions tend to have a more adverse impact on one group of employees than another. The applicants subsequently filed a civil action, and the court certified a class of approximately 6,000 African-American applicants who scored in the "qualified" range.

In most states, charges of discrimination are subject to a 300-day statute of limitations (only 180 days in some states). Here the applicants' earliest EEOC charge was filed more than 400 days after the applicants were notified of the results, but within 300 days of the City's second round of hiring. The trial court ruled that the City's ongoing reliance on the test was a continuing violation of Title VII, so the applicants' suit was timely.

The U.S. Court of Appeals for the 7th Circuit reversed, holding that in a disparate-impact case, once the testing is completed and applicants are sorted into categories such as "qualified" and "well qualified," no further discrimination occurs when the employer uses those categories to make hiring decisions. The 7th Circuit held that subsequent hiring decisions do not trigger a new 300-day period to file an EEOC charge, which meant the applicants' EEOC charge was not filed on time.