Lawsuit Alleging Hispanic Preference by Staffing Agency Proceeds

By Jeffrey Rhodes Dec 14, 2016
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A class-action lawsuit alleging that an employment agency of unskilled laborers discriminated against black applicants in favor of Hispanic applicants may proceed despite timeliness questions, the U.S. District Court for the Northern District of Illinois recently ruled.

Sidney Shirley was a black applicant for employment with Staffing Network Holdings LLC, an employment agency. Shirley visited the Staffing Network branch office in Hanover Park, Ill., to apply. Staffing Network provides its client companies with low-skilled and moderately skilled laborers to fill jobs on a daily basis. The company permits individuals who are seeking employment to walk into one of its branch offices to request a referral to an employer.

When Shirley sought work at the Hanover branch, he would sign in on a form that indicated the order in which applicants had arrived and then wait at the office to receive work. Shirley claimed that during the two years he sought work through Staffing Network, job applicants who appeared to be Hispanic and spoke Spanish were assigned to jobs while the applicants who appeared to be black were not. He estimated that about one-quarter of the applicants during that time were black.

[SHRM members-only toolkit: Managing Equal Employment Opportunity]

Shirley believed that the Hispanic individuals who received job assignments were no more qualified than Shirley and had not arrived at the office before him. Furthermore, Shirley alleged that when he was not present at the office, he did not receive assignments even though Hispanic laborers were contacted about work assignments.

On March 12, 2015, Shirley filed a charge of discrimination with the Equal Employment Opportunity Commission (EEOC). On June 16, 2016, Shirley filed a class-action lawsuit in district court alleging race discrimination in violation of Title VII of the Civil Rights Act and 42 U.S.C. §1981 on behalf of himself and similarly situated black applicants of Staffing Network. Staffing Network filed a motion to dismiss the lawsuit and a motion to strike and dismiss Shirley's class-action allegations.

Staffing Network claimed that Shirley's lawsuit was untimely. In Shirley's charge of discrimination, he asserted that the discrimination was taking place from "2011-present." However, Shirley wrote on a rider attached to his EEOC charge that he sought work assignments from 2011 "up through approximately June of 2013." If June 2013 controlled as Shirley's alleged final date of discrimination, then Shirley would have missed the 300-day window required for filing his Title VII claim.

The court read the charge of discrimination in the way most favorable to Shirley, understanding it to claim that the discrimination continued until the charge was filed, rather than until June of 2013. Similarly, with regard to Shirley's §1981 allegations, the court reasoned that his claims could be subject to either a four-year or two-year limitations period depending on whether Shirley had a contract with Staffing Network when he signed in at the branch offices. If he did, the discrimination would be subject to a four-year window; if not, it would be subject to a two-year window. The court found that Shirley's complaint was unclear as to whether his signing up with the staffing agency constituted a contractual relationship, but it accepted the claim as timely for purposes of the motion to dismiss because the claim was filed within the longer four-year limitations period.

The court further found that Shirley stated a plausible claim of disparate treatment by alleging that he observed Staffing Network referring Hispanic job applicants before referring black applicants with similar qualifications. The court noted, however, that the complaint did not provide details that would ultimately be necessary at trial, such as the specific dates on which Shirley sought work and the specific client companies for which he was qualified to work. Shirley also stated a valid disparate impact claim by alleging that Staffing Network has a "policy and practice of hiring Hispanic laborers over African American laborers."

Staffing Network requested that the court dismiss the class allegations as vague, conclusory and not appropriate for classwide relief. The court found, however, that Shirley's allegations were sufficient in alleging that Staffing Network engaged in a pattern and practice of referring Hispanic workers to jobs when black applicants were equally qualified for referral.

Shirley v. Staffing Network Holdings LLC, N.D. Ill., No. 16 C 6279 (Nov. 8, 2016).

Professional Pointer: Staffing agencies are particularly vulnerable to discrimination claims based on apparent disparities in selecting applicants for assignments. To limit this danger, agencies need clear procedures regarding how applicants will be considered and placed with clients to make sure that similarly qualified applicants receive equal access to assignments.

Jeffrey Rhodes is an attorney with Doumar Martin in Arlington, Va.

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