487 U.S. 977 (1988)
In August 1973 Clara Watson, who is black, was hired by Fort Worth Bank and Trust as a proof operator.1 In January 1976 she was promoted to teller in the Bank's drive-in facility.2 Between February 1980 and February 1981 Watson applied without success for four supervisory positions, each time losing out to a white applicant.3 The Bank employed roughly eighty people and had developed no precise formal criteria for the positions. It instead left promotion decisions to the subjective judgment of white supervisors who knew the candidates and the jobs.4
Watson filed a charge with the Equal Employment Opportunity Commission.5 After exhausting administrative remedies she sued the Bank in the United States District Court for the Northern District of Texas, alleging racial discrimination in hiring, compensation, placement, promotions, terminations, and other terms of employment.6 On her Rule 23 motion, the District Court certified a broad class of black applicants and employees, but later decertified it after finding no common question of law or fact.7 The employee subclass failed the numerosity requirement while Watson was not an adequate representative for applicants.8
The District Court then addressed Watson's individual promotion claims under the McDonnell Douglas and Burdine framework.9 It found that she had made out a prima facie case, but the Bank had articulated legitimate nondiscriminatory reasons for each decision.10 Watson had not proved those reasons pretextual. The court therefore dismissed the action.11 A divided Fifth Circuit panel affirmed the dismissal of Watson's claims and the class rulings, though it vacated the judgment as to the applicant class and remanded with instructions to dismiss those claims without prejudice.12
Watson contended that the District Court should have applied disparate impact analysis to the Bank's discretionary promotion practices.13 The Fifth Circuit held that Title VII challenges to discretionary promotion systems must be analyzed under the disparate treatment model.14 The Supreme Court granted certiorari to resolve the conflict among the circuits on that question.15
Whether disparate impact analysis may be applied to an employer's subjective or discretionary promotion system under Title VII of the Civil Rights Act of 1964?16
Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e-2, prohibits employment practices that discriminate on the basis of race even when adopted without discriminatory intent if they have significant adverse effects on protected groups.17 In Griggs v. Duke Power Co., the Court held that facially neutral practices with markedly disproportionate adverse effects on blacks violate the statute absent a showing that the practices are demonstrably related to the jobs for which they are used.18 Subsequent decisions applied this principle to standardized tests and criteria such as written aptitude tests, height and weight requirements, and rules against employing drug addicts.19 The Court has consistently used disparate treatment analysis requiring proof of intent when reviewing hiring and promotion decisions based on personal judgment or inherently subjective criteria.20 The question whether disparate impact analysis extends to subjective selection practices had divided the circuits and was presented squarely in this case.21
The statutory text in section 703(a)(2) makes it unlawful to limit or classify employees in any way that would deprive any individual of employment opportunities because of race.22 Section 703(h) provides a defense for professionally developed ability tests that are not designed or used to discriminate.23 The Court reasoned that the functional equivalence between facially neutral practices and intentional discrimination supports extending disparate impact analysis beyond objective tests.24 An employer's policy of leaving promotion decisions to the unchecked discretion of supervisors does not by itself raise an inference of discriminatory conduct.25 Yet the effects of such a system can be indistinguishable from intentionally discriminatory practices when subconscious stereotypes persist.26 The Court therefore concluded that subjective or discretionary employment practices may be analyzed under the disparate impact approach in appropriate cases.27
Yes. The Bank's practice of committing promotion decisions to the subjective judgment of white supervisors who knew the candidates constitutes a facially neutral employment practice that can be challenged under disparate impact analysis.28 Watson, a black employee hired as a proof operator in August 1973 and later promoted to teller, applied unsuccessfully for four supervisory positions between February 1980 and February 1981, each time losing to a white applicant.29 The Bank had no precise formal criteria and relied instead on the subjective assessments of supervisors.30
This system produced the same functional effects as the standardized tests at issue in Griggs because it operated without formal validation yet excluded black applicants from opportunities.31 The Court rejected the argument that confining disparate impact analysis to objective tests would allow employers to evade Griggs by adding brief interviews, confirming that the reasons supporting the doctrine apply equally to subjective criteria.32
Disparate impact analysis may be applied to an employer's subjective or discretionary promotion system under Title VII.33 The judgment of the Court of Appeals is vacated and the case is remanded for further proceedings to determine whether Watson made out a prima facie case under the standards announced.34
Related opinions on this issue
Joined by Justice Brennan And Justice Marshall
Justice Blackmun joined Parts I, II-A, II-B, and III of the opinion and agreed that disparate impact analysis applies to subjective selection processes.35 He wrote separately to emphasize that once a plaintiff establishes a prima facie case through a significant statistical disparity, the burden shifts to the defendant to prove business necessity.36 This is rather than merely to produce evidence of legitimate business reasons.37 Blackmun stressed that the allocation of burdens in disparate impact cases differs fundamentally from the McDonnell Douglas framework used in disparate treatment cases.38 This is because the violation focuses on the effect of the practice, not the employer's intent.39
He cautioned that the plurality's approach risked weakening the employer's obligation to persuade the court that the selection process is necessary to fulfill legitimate business requirements.40 Vague subjective criteria should not be more easily justified simply because they lack objective measures.41
Justice Stevens concurred in the judgment and agreed that the question whether disparate impact analysis applies to an employer's practice of committing employment decisions to the unchecked discretion of supervisors must be answered in the affirmative.42 He declined to join the plurality's discussion of evidentiary standards.43 Cases involving subjective discretion include too many variables to be adequately addressed without focusing on a particular factual context.44
Stevens would postpone further elaboration of the standards set forth in prior cases until after the District Court has made findings concerning the plaintiff's prima facie evidence of disparate impact and the defendant's explanation for its practice of giving supervisors discretion in making promotions.45