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TEXAS COURT OF APPEALS, = THIRD=20 DISTRICT, AT AUSTIN
NO. 03-05-
Texas Parks & Wildlife=20 Department, Appellant v.
This is an = interlocutory=20 appeal from the re-certification of a class action following this = Court's=20 reversal and remand of the original certification order. = See Tex.=20 Civ. Prac. & Rem. Code Ann. =A7 51.014(a)(3) (West 1997 & = Supp.=20 2006). Appellees Milburn Dearing, Kenneth Head, and Mike Warren,=20 individually and on behalf of others similarly situated = (collectively,=20 Dearing), sued their employer, the Texas Parks & Wildlife = Department,=20 alleging a disparate-impact theory of age discrimination = under=20 chapter 21 of the Texas Labor Code in regard to the Department's=20 reclassification of their game-warden positions. See Texas = Parks &=20 Wildlife Dep't v. Dearing, 150 S.W.3d 452, 466 (Tex.=20 App.--Austin 2004, pet. denied) (Dearing I), cert.=20 denied, 544 U.S. 960 (2005); see also = Tex.=20 Lab. Code Ann. =A7 21.051 (West 2006). The plaintiffs sought = certification=20 of a class of approximately 130 fellow game wardens whom they = claim were=20 similarly situated. Eighty-eight of the putative class members = have since=20 intervened as plaintiffs. The district court denied a plea to the=20 jurisdiction and summary-judgment motions asserted by the = Department and=20 certified the class. In Dearing = I, this=20 Court affirmed the district court's ruling on the Department's = plea to the=20 jurisdiction but reversed its order certifying the class. The = Court=20 concluded that the district court lacked subject-matter = jurisdiction to=20 certify the class, and that Dearing's claim was not viable, = because the=20 labor code did not permit an age-discrimination claim based on a=20 disparate-impact theory of liability. The Court construed section=20 21.122(b) of the labor code to mean that age-discrimination claims = based=20 on a disparate-impact theory of liability were available under the = labor=20 code to the same extent that such claims were available under the = Age=20 Discrimination in Employment Act of 1967 (ADEA). Dearing = I, 150=20 S.W.3d at 465; see Tex. Lab. Code Ann. =A7 21.122(b) = (West 2006);=20 see also Age Discrimination in Employment Act, 29 = U.S.C.A. =A7=A7=20 621-634 (West 1998 & Supp. 2006). The Court thus looked to = federal=20 jurisprudence addressing that question and found persuasive the = analysis=20 by the Fifth Circuit in Smith v. City of Jackson, 351 = F.3d 183,=20 195 (5th Cir. 2003), holding that the ADEA did not permit such = claims.=20 Dearing I, 150 S.W.3d at 465. Dearing filed a petition = for review=20 with the Texas Supreme Court, which was denied. He then sought = writ of=20 certiorari from the United States Supreme Court. While Dearing's = certiorari=20 petition was pending, the Supreme Court affirmed the Fifth = Circuit's=20 judgment in Smith, but disagreed with its reasoning that = claims=20 based on a disparate-impact theory of liability are categorically=20 unavailable under the ADEA. See 544 U.S. 228, 232-43 = (2005)=20 (plurality opinion); id. at 243 (Scalia, J., concurring) = ("I=20 agree with all of the Court's reasoning, but would find it a = basis, not=20 for independent determination of the disparate-impact question, = but for=20 deferral to the reasonable views of the Equal Employment = Opportunity=20 Commission" that disparate-impact claims are permitted under the = ADEA).=20 The Supreme Court affirmed the Fifth Circuit's judgment on the = bases that=20 (1) the claimants had failed to identify sufficiently an = employment=20 practice within the city's pay plan that had an adverse impact on = older=20 workers; and (2) the city's plan was based on reasonable factors = other=20 than age. Id. at 242. Subsequently, the Supreme Court = denied=20 Dearing's certiorari petition. 544 U.S. 960 (2005). After the Supreme = Court=20 denied certiorari, this case was remanded to the district court = pursuant=20 to this Court's mandate "for further proceedings consistent with = [our]=20 opinion." On remand--without amending his pleadings or introducing = additional evidence--Dearing filed a motion to reinstate the = original=20 class certification order. The district court granted Dearing's = motion,=20 issuing an order incorporating its original certification order = without=20 change. The Department now = appeals=20 the district court's order. For the reasons explained below, we = reverse=20 the order and remand for further proceedings consistent with this=20 opinion.
The = underlying=20 dispute The factual = background of=20 these proceedings is detailed in Dearing I. 150 S.W.3d = 452. The=20 putative class members were at relevant times employed as game = wardens by=20 the Department. Originally, their job classifications ranged from = "Game=20 Warden I" through "Game Warden IV." Promotions within these = classification=20 levels were based on length of service and were made every four = years. In=20 1994, the Department reclassified the game wardens who had = accumulated=20 over 16 years of service from "Game Wardens IV" to "Field Sergeant = Game=20 Wardens" and assigned them additional duties. The following year, = the=20 legislature passed a pay-parity rider that prohibited the = Department from=20 compensating its state-commissioned peace officers "at a rate less = than=20 the rate paid by any other state agency to a = state-commissioned peace=20 officer performing similar duties." See Act of May 25, = 1995, 74th=20 Leg., R.S., ch. 1063, 1995 Tex. Gen. Laws 5242, 5857 (effective = Sept. 1,=20 1995). The Department's executive director appointed a committee = to study=20 the pay-parity issue. The committee determined that Field Sergeant = Game=20 Wardens performed duties similar to those of sergeants employed by = the=20 Department of Public Safety and recommended increasing these game = wardens'=20 compensation to level C-7, the pay level of the DPS sergeants = identified=20 as their counterparts. In 1996, Field Sergeant Game Wardens = received that=20 raise. The legislature = subsequently=20 added a new top tier to the game-warden job classification, "Game = Warden=20 V," adopted Salary Schedule C designating compensation for the = position at=20 the C-6 level, and specified that adoption of the salary schedule = could=20 not result in decreased pay for any classified employee. = See Act=20 of May 29, 1997, 75th Leg., R.S., ch. 1452, 1997 Tex. Gen. Laws = 5535,=20 6341, 6345 (effective Sept. 1, 1997) (the pay rider). Legislative=20 descriptions of the duties of Field Sergeant Game Wardens matched = those of=20 the new Game Wardens V and, when the bill took effect, the = Department=20 reclassified the Field Sergeant Game Wardens to Game Wardens V. = Because=20 the pay rider prohibited reduction of their salaries through the=20 reclassification, the former Field Sergeant Game Wardens = reclassified as=20 Game Wardens V were "grandfathered" and continued to be paid at = the C-7=20 rather than C-6 level. In 1999, the = legislature=20 increased salaries for all Texas peace-officer positions. = See Act=20 of Apr. 23, 1999, 76th Leg., R.S., ch. 1589, 1999 Tex. Gen. Laws = 5446,=20 6262-6263 (effective Sept. 1, 1999). The Department reclassified = the=20 grandfathered Game Wardens V (the former Field Sergeant Game = Wardens) to a=20 new C-6 pay level, which had the effect of giving them a pay raise = from=20 $42,084 (the former C-7 level) to $44,600 (the new C-6 level). = However,=20 the new C-6 level pay was less than the new C-7 level pay of = $50,600.=20 Thus, it is alleged, the Former Field Sergeant Game Wardens = received a=20 reduction in pay and other benefits relative to other positions = that=20 remained at the C-7 level. It is further alleged that "[a]ll of = the more=20 than 130 Field Sergeant Game Wardens, save one, were over the age = of 40 at=20 the time of the reclassification." Proceedings=20 below Dearing sued, = alleging that=20 because none of the other sergeant positions at the Department had = been=20 reclassified, the Department's reclassification of the former = Field=20 Sergeant Game Wardens from the C-7 to the C-6 level constituted = unlawful=20 age discrimination. See Tex. Lab. Code Ann. =A7=A7 21.051 = (prohibiting employers from discriminating against employees on = basis of=20 race, color, disability, religion, sex, national origin, or age), = .101=20 (West 2006) (defining classification of persons protected against = age=20 discrimination as those age forty or older). Dearing also alleged = breach=20 of contract, sought a declaratory judgment that the Department = violated=20 the 1997 and 1999 appropriations acts, and sought mandamus to = remedy the=20 Department's reclassification of the former Field Sergeant Game = Wardens=20 from C-7 to C-6. Dearing requested certification of a class = defined as=20 "all Field Sergeant Game Wardens employed by the Texas Parks and = Wildlife=20 Department on September 1, 1999, who were reclassified from pay = group C-7=20 to pay group C-6 and from Field Sergeant Game Warden to Game = Warden=20 V." The Department =
filed a plea=20
to the jurisdiction, asserting that the age-discrimination claim =
was=20
barred because (1) Dearing's individual complaint had not been =
timely=20
filed; (2) even assuming that Dearing's claim had been timely =
filed, none=20
of the other plaintiffs had individually exhausted their =
administrative=20
remedies before filing suit; and (3) the reclassification had been =
legislatively mandated, rationally related to a legitimate state =
interest,=20
and not subject to an attack based on age discrimination. After a hearing, = the=20 district court granted the Department's plea to the jurisdiction = as to=20 Dearing's breach-of-contract, declaratory-judgment, and mandamus = claims,=20 but denied it as to his age-discrimination claims. It also denied = both=20 parties' summary-judgment motions. The court granted Dearing's = motion for=20 class-certification "under Tex. R. Civ. P. 42(b)(4)." Its order=20 incorporated a trial plan identifying "the issues remaining to be = tried in=20 this case" after its rulings on the Department's plea to the = jurisdiction=20 and the parties' summary judgment motions: a. Plaintiffs' = disparate=20 impact claims for age discrimination in violation of Tex. Labor = Code Ann.=20 =A7 21.051, b. Defendants' = affirmative=20 defense that their actions were rationally related to a legitimate = state=20 interest, c. Defendants' = affirmative=20 defense that they were required by law to take the actions that = they did=20 in 1999, d. Defendants' = affirmative=20 defense that they would have taken the same actions that they did = with=20 regard to Plaintiffs . . . irrespective of the[ir] = ages. The plan did not = elaborate=20 on the elements of Dearing's disparate-impact claim or why it = would best=20 be tried as a class action other than to state: "The = reclassification=20 applied to all members of the class at the same time and affected = all of=20 them in the same manner. Thus, all of the proof and evidence = relevant to=20 this issue will be the same for all members of the class, so there = is no=20 need for separate procedures within the trial for individual = plaintiffs on=20 this issue." Nor did the plan explain how this claim would be = tried other=20 than to observe that, "Plaintiffs must first establish that the=20 reclassification made the basis of this suit has a = disproportionate effect=20 on persons who were 40 years of age or older." The plan went on to = provide, "If a directed verdict is not granted after the = Plaintiffs' case=20 in chief, then the affirmative defenses set out above will need to = be=20 tried," again observing that, "The reclassification applied to all = members=20 of the class at the same time and affected all of them in the same = manner.=20 Thus, all of the proof and evidence relevant to this issue will be = the=20 same for all members of the class, so there is no need for = separate=20 procedures within the trial for individual plaintiffs on this = issue." The=20 plan then stated that, "Damages for each individual member of the = class=20 will be a manner of mechanical calculation" and proceeded to = detail=20 different methodologies to determine damages for class members who = had=20 retired before the date of the judgment and those who had not. The = order=20 set a trial date of June 16, 2003 and various discovery = deadlines--all in=20 the first half of 2003. Dearing=20
I The Department =
appealed from=20
the district court's order denying its plea to the jurisdiction =
and=20
certifying the class. But the Court = reversed the=20 grant of class certification. It concluded that the sole claim for = which=20 the class was certified--a disparate-impact age-discrimination = claim--was=20 not available under the labor code, an issue that it regarded as = going to=20 both the viability of Dearing's claim and the subject-matter = jurisdiction=20 of the district court, as it controlled whether Dearing's claim = came=20 within the labor code's waiver of sovereign immunity for=20 age-discrimination claims. Id. at 465-66 & n.8; = see State=20 Farm Mut. Auto. Ins. Co. v. Lopez, 156 S.W.3d 550, 557 (Tex. = 2004).=20 This Court construed section 21.122(b) of the code to "state[] = that=20 disparate-impact claims are available for age discrimination in = this state=20 only if they are available under the ADEA." Dearing I, = 150 S.W.3d=20 at 465. Accordingly, it looked to federal jurisprudence on that = issue and=20 found persuasive the analysis of the Fifth Circuit in = Smith that=20 disparate-impact age-discrimination claims were unavailable under = the=20 ADEA. Because the Court "reverse[d] the order certifying the class = on=20 jurisdictional grounds," it did not address issues raised by the=20 Department challenging whether the plaintiffs had met the other=20 requirements for class certification under rule 42, such as = numerosity,=20 commonality, predominance, and superiority. Id. at 466=20 n.8. Dearing then filed = a=20 petition for review in the Texas Supreme Court, which was denied, = and then=20 filed a petition for writ of certiorari in the United States = Supreme=20 Court. While Dearing's certiorari petition was pending, the United = States=20 Supreme Court issued its Smith decision. Because = Smith=20 provides the backdrop for many of the issues the parties present = in this=20 proceeding, it is helpful to review it in some = detail. The ADEA =
and=20
Smith Smith = construed the=20 ADEA's general prohibition against employment discrimination, = which=20 provides: It shall be = unlawful for an=20 employer-- (1) to fail or = refuse to=20 hire or to discharge any individual or otherwise discriminate = against any=20 individual with respect to his compensation, terms, conditions, or = privileges of employment, because of such individual's = age; (2) to limit, = segregate, or=20 classify his employees in any way which would deprive or tend to = deprive=20 any individual of employment opportunities or otherwise adversely = affect=20 his status as an employee because of such individual's age . . .=20 . 29 U.S.C.A. =A7 = 623(a) (West=20 1998). Section 623(a) was modeled after section 703(a) of Title = VII=20 of the Civil Rights Act of 1964 and is substantively = identical=20 "[e]xcept for substitution of the word 'age' for the words 'race, = color,=20 religion, sex or national origin.'" Smith, 544 U.S. at = 233;=20 see 42 U.S.C.A. =A7 2000e-2 (West 2003). The United = States=20 Supreme Court has recognized two basic theories of liability under = section=20 703(a) of title VII: disparate treatment, which requires proof = that an=20 employer's actions were actually motivated by the employee's = protected=20 classification, and disparate impact, which does not require proof = of=20 motive. Disparate-impact claims of employment discrimination = challenge=20 "employment practices that are facially neutral in their treatment = of=20 different groups but that in fact fall more harshly on one group = than=20 another . . . ." Smith, 544 U.S. at 239 (quoting=20 International Bhd. of Teamsters v. United States, 431 = U.S. 324,=20 335-36 n.15 (1977)). The Supreme Court = first=20 recognized the disparate-impact theory of liability under title = VII in=20 Griggs v. Duke Power Co., 401 U.S. 424 (1971), which = involved a=20 challenge to facially race-neutral educational requirements and=20 intelligence tests. The Court assumed that the employer had not = adopted=20 the requirements with intent to discriminate, but nonetheless held = that=20 good faith "does not redeem employment procedures . . . that = operate as=20 'built-in headwinds' for minority groups and are unrelated to = measuring=20 job capability." Id. at 432. It relied principally on = what it=20 perceived to be Congress's intent in enacting title VII: "to = achieve=20 equality of employment opportunities and remove barriers that have = operated in the past to favor an identifiable group of white = employees=20 over other employees" and prohibit "practices, procedures, or = tests=20 neutral on their face, and even neutral in terms of intent . . . = if they=20 operate to 'freeze' the status quo of prior discriminatory = employment=20 practices." Id. at 429-30. The Court explained that, = "What is=20 required by Congress is the removal of artificial, arbitrary, and=20 unnecessary barriers to employment when the barriers operate = invidiously=20 to discriminate on the basis of racial or other impermissible=20 classification." Id. at 431. "The touchstone is business=20 necessity. If an employment practice which operates to exclude = Negroes=20 cannot be shown to be related to job performance, the practice is=20 prohibited." Id. Although = Griggs=20 relied primarily on the policy goals of title VII, the = Supreme Court=20 subsequently noted that "our holding represented the better = reading of the=20 statutory text as well." Smith, 544 U.S. at 235 (citing=20 Watson v. Fort Worth Bank & Trust, 487 U.S. 977, 991 = (1988)).=20 Specifically, the Court emphasized that section 703(a)(2) = prohibits not=20 only actions that "limit, segregate, or classify" persons, but = also any=20 actions that "deprive any individual of employment opportunities = or=20 otherwise adversely affect his status as an employee, = because of=20 such individual's race," color, religion, sex, or national = origin."=20 Id. (citing Watson, 487 U.S. at 991). This = statutory=20 text, the supreme court has concluded, "focuses on the = effects of=20 the action on the employee rather than the motivation for the = actions of=20 the employer." Id. at 236. Prior to =
Smith,=20
disparate-treatment claims were clearly actionable under the ADEA, =
see=20
Hazen Paper Co. v. Biggins, 507 U.S. 604, 609-10 (1993), but =
it was=20
uncertain whether disparate-impact claims were similarly =
actionable. In=20
the aftermath of Griggs, numerous federal appellate =
courts=20
had assumed that given the parallel language in the two =
statutes, the=20
disparate-impact theory under title VII would also be available =
under the=20
ADEA. These decisions =
had prompted=20
judicial and scholarly debate. See Markham v. Geller, 451 =
U.S.=20
945 (1981) (Rehnquist, J., dissenting from denial of certiorari)=20
(criticizing court of appeals decision that had applied the title =
VII=20
disparate-impact analysis to the ADEA); Metz v. Transit Mix,=20
Inc., 828 F.2d 1202, 1216-20 (7th Cir. 1987) (Easterbrook, =
J.,=20
dissenting); see generally Douglas C. Herbert & Lania =
Schweiker Shelton, A Pragmatic Argument Against Applying the =
Disparate=20
Impact Doctrine in Age Discrimination Cases, 37 S. Tex. L. =
Rev. 625,=20
627 nn.6-7 (collecting cases and articles). In its 1993 Hazen=20
Paper decision--an ADEA disparate-treatment =
age-discrimination=20
case--the Supreme Court emphasized that "we have never decided =
whether a=20
disparate impact theory of liability is available under the ADEA, =
and we=20
need not do so here." 507 U.S. at 610 (citation omitted). Three=20
justices--Rehnquist, Kennedy, and Thomas--concurred to point out =
that=20
"nothing in the Court's opinion should be read as incorporating in =
the=20
ADEA context the so-called 'disparate impact' theory of Title VII" =
and=20
further observed that "there are substantial arguments that it is =
improper=20
to carry over disparate impact analysis from Title VII to the =
ADEA."=20
Id. at 617-18 (Kennedy, J., concurring). Hazen =
Paper=20
influenced many federal courts to begin holding that =
disparate-impact=20
claims were not available under the ADEA. See Smith, 544 =
U.S. at=20
237; see also Dearing I, 150 S.W.3d at 462 =
("Hazen cast=20
some doubt on the future of disparate-impact claims."). In =
Smith,=20
the Fifth Circuit followed that trend, invoking many of the common =
arguments advanced by the judicial and scholarly opponents of =
extending=20
title VII's disparate-impact theory to the ADEA. Smith, =
351 F.3d=20
at 463-65; see generally Herbert & Shelton, =
supra,=20
at 636-50. We analyzed these arguments in Dearing I. =
See=20
150 S.W.3d at 463-65. Smith =
involved=20
facts similar to those in this case: a group of police and =
public-safety=20
officers who were over the age of forty and employed by the City =
of=20
Jackson, Mississippi sued the city under the ADEA, complaining =
that=20
across-the-board salary increases--which were designed to raise =
the=20
starting salaries of police officers up to the regional =
average--resulted=20
in salary increases that were proportionately greater for officers =
with=20
less than five years' service, most of whom were under the age of =
forty.=20
Smith, 544 U.S. at 231. Although all police officers =
received=20
raises, the claimants alleged that the city deliberately =
discriminated=20
against them because of their age (the disparate treatment claim), =
and the=20
pay plan adversely affected them because of their age (the=20
disparate-impact claim). Id. In holding that =
the=20
officers' disparate-impact claims were not available under the =
ADEA, the=20
Fifth Circuit acknowledged that the ADEA closely paralleled title =
VII, but=20
with an important difference: the ADEA, unlike title VII, =
explicitly=20
provided that an employer may "take any action otherwise =
prohibited . . .=20
where the differentiation is based on reasonable factors other =
than age."=20
Smith, 351 F.3d at 193-94; see 29 U.S.C.A. =A7 =
623(f)(1).=20
The court reasoned that this "RFOA" provision would render =
the ADEA's=20
general prohibition against age discrimination a nullity to the =
extent=20
that it prohibited disparate-impact discrimination and cause the =
general=20
prohibition to "become nothing more than a bromide to the effect =
that=20
'only age discrimination is age discrimination.'" Smith, =
351 F.3d=20
at 190 (quoting Mullin v. Raytheon Co., 164 F.3d 696, 702 =
(1st=20
Cir. 1999)). Thus, the Fifth Circuit concluded that the ADEA's =
general=20
age-discrimination prohibition must permit only the =
disparate-treatment=20
liability theory. Id. at 190. The Fifth Circuit =
also=20
pointed to broader differences between the congressional policy =
objectives=20
underlying the ADEA versus those of title VII. Id. at =
195. During=20
its deliberations preceding the enactment of title VII, Congress =
had=20
considered and rejected the inclusion of older workers among the =
classes=20
protected from employment discrimination, but had authorized the =
Secretary=20
of Labor to prepare a study "of the factors which might tend to =
result in=20
discrimination in employment because of age and the consequences =
of such=20
discrimination on the economy and individuals affected." =
Smith,=20
544 U.S. at 232. Thereafter, The ADEA was =
enacted after=20
the Secretary of Labor issued a report on age discrimination =
recommending=20
that Congress ban arbitrary discrimination, such as disparate =
treatment=20
based on stereotypical perceptions of the elderly, but that =
factors=20
affecting older workers, such as policies with disparate impact, =
be=20
addressed in alternative ways. Smith, [544 U.S.] at 195;=20
Mullin, 164 F.3d at 702-03; see U.S. Dep't of =
Labor, The=20
Older American Worker: Age Discrimination in Employment 2, 6, =
21-25 (1965)=20
(Congress should prohibit "arbitrary discrimination" based on age =
and age=20
stereotypes, but factors that "affect older workers more strongly, =
as a=20
group, than they do younger workers" should be addressed through=20
programmatic measures to improve opportunities for older =
workers.). Title=20
VII, on the other hand, had a broad remedial purpose: To "achieve =
equality=20
of employment opportunities and remove barriers that have operated =
in the=20
past to favor an identifiable group of white employees over other=20
employees." Griggs, 401 U.S. at 429-30, 91 S.Ct. 849, =
quoted in=20
Smith, at 194-195; Adams [v. Florida Power=20
Co.], 255 F.3d [1322,]1325-26 [11th Cir. 2001)] ("history of =
the ADEA=20
differs from the legislative history of Title VII, which the =
Supreme Court=20
in Griggs relied on to find a cause of action for =
disparate=20
impact"); Ellis [v. United Airlines, Inc.], 73 =
F.3d=20
[999,] 1008 [10th Cir. 1996)] ("legislative history of the ADEA =
suggests=20
it was not enacted to address disparate impact claims"). "The =
cornerstone=20
of Griggs's holding that disparate impact is cognizable =
under=20
Title VII is thus the link between the history of educational=20
discrimination on the basis of race and the use of that =
discrimination to=20
continue to disadvantage individuals on the basis of their race."=20
Smith, at 195 (citing Griggs, 401 U.S. at =
432, 91=20
S.Ct. 849). "[A]bsent from the scope of the ADEA are the =
historical and=20
remedial concerns that, in the Title VII context, led to the =
recognition=20
of disparate impact claims directed at overcoming the consequences =
of past=20
societal discrimination." Dearing =
I, 150=20
S.W.3d at 463-64. Also, as we =
observed in=20
Dearing I, federal courts had attributed some =
significance to=20
differences between subsequent amendments to the ADEA and title =
VII.=20
See id. at 464-65. Following Griggs, an =
elaborate body=20
of case law developed under title VII concerning the standards for =
proving=20
disparate-impact liability and any proffered "business necessity." =
In=20
Wards Cove Packing Co. v. Antonio, 490 U.S. 642 (1989), =
the=20
Supreme Court held that to establish a prima facie case of=20
disparate-impact race discrimination under title VII, a plaintiff =
was=20
required to (1) isolate and identify the specific employment =
practice=20
challenged; (2) demonstrate any observed statistical disparity =
that the=20
practice has on a protected class; and (3) demonstrate a causal =
link=20
between the identified practice and the demonstrated disparity.=20
Id. at 655-56. Assuming that a plaintiff could =
successfully=20
assert a prima facie case under this standard, Wards Cove =
held=20
that the burden of production shifted to the employer to produce =
evidence=20
of a business necessity for the use of the practice in question.=20
Id. at 658-59. That inquiry entailed consideration of =
whether the=20
challenged practice served, in a "significant" (but not =
necessarily=20
"essential" or "indispensable") way, the employer's "legitimate"=20
employment goals and whether there were available alternative =
practices to=20
achieve the same business ends. Id. Wards Cove =
further=20
held that while the employer had the burden of production in this =
phase,=20
the ultimate burden of persuasion remained with the plaintiff.=20
Id. at 659. The Supreme Court explained that "the =
ultimate burden=20
of proving that discrimination against a protected group has been =
caused=20
by a specific employment practice remains with the plaintiff =
at all=20
times . . . for it is he who must prove that it was because =
of such=20
individual's race, color, etc., that he was denied a desired =
employment=20
opportunity." Id. at 659-60 (citations omitted). =
Wards=20
Cove was controversial, see Smith, 544 U.S. at 240=20
(characterizing Wards Cove as "narrowly constru[ing] the=20
employer's exposure to liability on a disparate-impact theory"), =
and=20
Congress responded to it and other controversial Supreme Court=20
employment-discrimination decisions by enacting the Civil Rights =
Act of=20
1991. Civil Rights Act of 1991, Pub. L. No. 102-166, 105 Stat. =
1071. Among=20
other changes, Congress added a new subsection (k) to title VII's =
section=20
703 that codified the disparate-impact theory of liability for the =
first=20
time, clarified the requirements for establishing a prima facie =
case,=20
placed on the defendant the burden of both production and =
persuasion=20
regarding business necessity, and made plaintiffs' proof of =
alternative=20
employment practices easier. Civil Rights Act of 1991, Pub. L. No. =
102-166, sec. 105, =A7 703, 105 Stat. 1071, 1074-75 (current =
version at=20
42 U.S.C.A. =A7 2000e-2(k)). However, while amending other =
portions of=20
the ADEA, Congress did not make amendments to section 623(a) that=20
corresponded to its amendments to title VII, section 723(a). =
Congress's=20
insertion of a specific provision into title VII governing=20
disparate-impact claims while omitting it from the ADEA--even =
while the=20
ADEA was undergoing amendments at the same time, in the same=20
legislation--was viewed by some federal courts as consistent with=20
Congress's broader intent to preclude such a claim under the ADEA. =
See=20
Dearing, 150 S.W.3d at 464. The Supreme Court =
granted=20
certiorari in Smith to address "whether the =
'disparate-impact'=20
theory of recovery announced in Griggs . . . , for cases =
brought=20
under Title VII of the Civil Rights Act of 1964, is cognizable =
under the=20
ADEA." Smith, 544 U.S. at 230. The Court stated =
that the=20
textual parallels between section 703(a)(2) of title VII and =
section=20
623(a)(2) of the ADEA made Griggs a "precedent of =
compelling=20
importance" and "strongly suggests that a disparate-impact theory =
should=20
be cognizable under the ADEA." Id. at 233-37. In fact, =
the Court=20
observed, federal appellate courts had "uniformly" interpreted the =
ADEA=20
during the decades following Griggs as authorizing =
recovery on a=20
disparate-impact theory. Id. at 236-37 & n.8 =
(collecting=20
cases). Lower courts had ceased to do so, the Supreme Court=20
suggested, based on a misunderstanding of its Hazen Paper =
decision, and that "there is nothing in our opinion in Hazen=20
Paper that precludes an interpretation of the ADEA that =
parallels our=20
holding in Griggs." See id. at 237-38 (citing =
Hazen=20
Paper, 507 U.S. at 612). However, the =
Supreme Court=20
also recognized the important textual differences between the ADEA =
and=20
title VII. In particular, the Court observed that the ADEA's RFOA=20
provision "significantly narrows its coverage" by permitting =
"otherwise=20
prohibited" action "where the differentiation is based on =
reasonable=20
factors other than age." Smith, 544 U.S. at 233 (quoting =
29=20
U.S.C.A. =A7 623(f)(1) (West 1999)). The RFOA provision, as the=20
Smith Court observed, reflected legislative origins of =
the ADEA=20
that differed from those of title VII. Congress' decision =
to limit=20
the coverage of the ADEA by including the RFOA provision is =
consistent=20
with the fact that age, unlike race or other classifications =
protected by=20
Title VII, not uncommonly has relevance to an individual's =
capacity to=20
engage in certain types of employment. To be sure, Congress =
recognized=20
that this is not always the case, and that society may perceive =
those=20
differences to be larger or more consequential than they are in =
fact.=20
However, as Secretary [of Labor] Wirtz noted in his report, =
"certain=20
circumstances . . . unquestionably affect older workers more =
strongly as a=20
group than they do younger workers." Wirtz Report 28. Thus, it is =
not=20
surprising that certain employment criteria that are routinely =
used may be=20
reasonable despite their adverse impact on older workers as a =
group.=20
Moreover, institutional discrimination on the basis of age has not =
occurred at the same levels as discrimination against those =
protected by=20
Title VII. While the ADEA reflects Congress' intent to give older =
workers=20
employment opportunities whenever possible, the RFOA reflects this =
historical difference. Id. at =
240-41. But=20
the Supreme Court drew different inferences from these =
distinctions=20
regarding Congress's intent than had the courts of appeals. In the =
Supreme=20
Court's view, the RFOA confirmed, rather than negated, Congress's =
intent=20
to permit disparate-impact claims under the ADEA. Id. at =
238. The=20
Court reasoned that if the ADEA had permitted only =
disparate-treatment=20
claims and an employer in fact had acted based on a factor other =
than age,=20
the RFOA provision would have been redundant and unnecessary =
because the=20
employer's action would not have been "otherwise prohibited" in =
the first=20
place. Id. It suggested that "[i]t is . . . in cases =
involving=20
disparate-impact claims that the RFOA provision plays its =
principal role=20
by precluding liability if the adverse impact was attributable to =
a nonage=20
factor that was 'reasonable.' Rather than support an argument that =
disparate impact is unavailable under the ADEA, the RFOA provision =
actually supports the contrary conclusion." Id. at=20
239. The =
Supreme Court=20
held that "[t]he text of the statute, as interpreted in =
Griggs,=20
the RFOA provision, and the EEOC regulations [holding that a=20
disparate-impact claim was available under the ADEA] all support=20
petitioner's view," and that it "was error for the Court of =
Appeals to=20
hold that the disparate-impact theory of liability is =
categorically=20
unavailable under the ADEA." Id. at 240. Nonetheless, the =
Court=20
emphasized that "[t]wo textual differences between the ADEA and =
Title VII=20
make it clear that even though both statutes authorize recovery on =
a=20
disparate-impact theory, the scope of disparate-impact liability =
under=20
ADEA is narrower than under Title VII." Id. The first was =
the=20
RFOA provision. Id. The second was Congress's amendments =
to title=20
VII--but not to the ADEA--in the Civil Rights Act of 1991. =
Id.=20
Because of the latter distinction, the Smith Court =
reasoned,=20
"Wards Cove's pre-1991 interpretation of Title VII's =
identical=20
language remains applicable under the ADEA." =
Id. The Supreme Court =
concluded=20
that the plaintiffs had failed to meet Wards Cove's =
requirements=20
for establishing a prima facie case of disparate-impact age=20
discrimination: [P]etitioners have =
done=20
little more than point out that the pay plan at issue is =
relatively less=20
generous to older workers than to younger workers. They have not=20
identified any specific test, requirement, or practice within the =
pay plan=20
that has an adverse impact on older workers. As we held in =
Wards=20
Cove, it is not enough to simply allege that there is a =
disparate=20
impact on workers, or point to a generalized policy that leads to =
such an=20
impact. Rather, the employee is "'responsible for isolating and=20
identifying the specific employment practices that are allegedly=20
responsible for any observed statistical disparities.'" 490 U.S. =
at 656=20
(emphasis added) (quoting Watson, 487 U.S. at 994). =
Petitioners=20
have failed to do so. Their failure to identify the specific =
practice=20
being challenged is the sort of omission that could "result in =
employers=20
being potentially liable for 'the myriad of innocent causes that =
may lead=20
to statistical imbalances . . . .'" 490 U.S. at 657. Id. at =
241. The=20
Court then stated, "not only did petitioners thus err by failing =
to=20
identify the relevant practice, but it is also clear from the =
record that=20
the City's plan was based on reasonable factors other than age."=20
Id. The city had perceived a need to raise the salaries =
of junior=20
officers to make them competitive with comparable positions in the =
market.=20
Id. at 242. Older officers, who tended to occupy more =
senior=20
positions, on average received smaller increases when measured as =
a=20
percentage of their salary. Id. The Court concluded that =
the=20
disparate impact was attributable to the city's decision to give =
raises=20
based on seniority and position, and the city's reliance on these =
factors=20
was "unquestionably reasonable," given its goal of raising =
employees'=20
salaries to make them comparable with those in surrounding =
communities.=20
Id. The Court held that the city's decision to grant a =
larger=20
raise to lower-echelon employees to establish salaries that were=20
equivalent to those of police forces in surrounding communities =
was based=20
on a "reasonable factor other than age" and was responsive to the =
city's=20
legitimate goal of retaining police officers. Id. On this =
basis,=20
the Supreme Court affirmed the judgment of the Fifth Circuit. =
The Supreme Court=20
subsequently denied Dearing's petition for certiorari. Thereafter, =
our=20
mandate to the district court in Dearing I =
issued. Proceedings after=20
remand On remand, Dearing =
filed a=20
motion to reinstate the district court's original =
class-certification=20
order, relying on the same underlying petition and evidence, =
without=20
modification or amendment, on which the court had originally =
certified the=20
class. The district court granted the motion, stating simply that =
its=20
prior certification order, which was attached, "is hereby =
reinstated." The=20
court did not prepare findings of fact and conclusions of law, nor =
did the=20
Department request it to do so. The Department appeals this=20
order. In five issues, = the=20 Department contends that the district court abused its discretion = in=20 reinstating its prior order granting class certification. It = argues that:=20 (1) the district court's re-certification of the class based on = the same=20 pleadings, evidence, and trial plan conflicted with this Court's = mandate=20 in Dearing I; (2) if we revisit Dearing I in = light of=20 the Supreme Court's intervening Smith decision, we should = hold=20 that the labor code permits disparate-impact age-discrimination = claims=20 subject to the same standards of proof identified in = Smith; (3)=20 because the district court's trial plan did not address each = element=20 required by Smith and the ADEA, among other defects, the = district=20 court abused its discretion in certifying the class; and (4) = because=20 Dearing has not, and cannot, plead a proper disparate-impact claim = under=20 these standards, not only was certification an abuse of = discretion, but we=20 should proceed to hold that Dearing's claim is barred by sovereign = immunity and dismiss it. In its fifth issue, the Department urges = that if=20 the Court revisits Dearing I to address the effect of=20 Smith, it should also revisit Dearing I's = holdings=20 regarding exhaustion-of-remedies requirements and hold that = Dearing and=20 the putative class members failed to exhaust administrative=20 remedies. Class-certification=20 requirements and standard of review On remand, the =
decision by=20
the district court to re-certify the class was governed =
by rule of=20
civil procedure 42, as amended in October 2003. Tex. R. Civ. P. =
42;=20
see BMG Direct Mktg. v. Peake, 178 S.W.3d 763, 777 n.10 =
(Tex.=20
2005). The Texas Supreme = Court has=20 rejected a "certify now and worry later approach" and has instead = required=20 courts to "perform a rigorous analysis before ruling on class=20 certification to determine whether all prerequisites to = certification have=20 been met." Bernal, 22 S.W.3d at 435. A proper analysis = requires=20 courts to "go beyond the pleadings" and identify the substantive = issues=20 that will control the litigation in order to discern which issues = will=20 predominate. Peake, 178 S.W.3d at 777. Trial courts must = resolve=20 disputes affecting the underlying substantive law prior to = certification=20 "as courts can hardly evaluate the claims, defenses or applicable = law=20 without knowing what the law is." Compaq Computer Corp. v.=20 Lapray, 135 S.W.3d 657, 672 (Tex. 2004). The impact of recent = cases=20 affecting the controlling substantive law must be considered. = See=20 Union Pacific Res. Group, Inc. v. Hankins, 111 S.W.3d 69, 72 = (Tex.=20 2003). The supreme court has further instructed us that = dispositive issues=20 going to the viability of the class claims should be resolved by = the trial=20 court before certification is considered. Lopez, 156 = S.W.3d at=20 557. Trial plans are = required in=20 every order certifying a class "'to allow reviewing courts to = assure=20 that all requirements for certification under Rule 42 have been=20 satisfied.'" Peake, 178 S.W.3d at 778 (quoting = Lopez,=20 156 S.W.3d at 556). "The formulation of a trial plan assures that = a trial=20 court has fulfilled its obligation to rigorously analyze all = certification=20 prerequisites and understands the claims, defenses, relevant = facts, and=20 applicable substantive law in order to make a meaningful = determination of=20 the certification issues." Id. The trial-plan requirement = is now=20 codified in rule 42(c)(1)(D): An order granting = or denying=20 certification under Rule 42(b)(3) must state: (i) the elements = of each=20 claim or defense asserted in the pleadings;
(ii) any issues of = law or=20 fact common to the class members;
(iii) any issues = of law or=20 fact affecting only individual class members;
(iv) the issues = that will be=20 the object of most of the efforts of the litigants and the=20 court;
(v) other = available methods=20 of adjudication that exist for the controversy; (vi) why the = issues common=20 to the members of the class do or do not predominate over = individual=20 issues;
(vii) why a class = action is=20 or is not superior to other available methods for the fair and = efficient=20 adjudication of the controversy; and
(viii) if a class = is=20 certified, how the class claims and any issues affecting only = individual=20 members, raised by the claims or defenses asserted in the = pleadings, will=20 be tried in a manageable, time efficient manner. Tex. R. Civ. P.=20 42(c)(1)(D). We review a trial = court's=20 order certifying a class for abuse of discretion, but we do not = indulge=20 every presumption in favor of the trial court's ruling. Schein = v.=20 Stromboe, 102 S.W.3d 675, 691 (Tex. 2002). "A trial court has = discretion to rule on class certification issues, and some of its=20 determinations--like those based on its assessment of the = credibility of=20 witnesses, for example--must be given the benefit of the doubt. = But the=20 trial court's exercise of discretion cannot be supported by every=20 presumption that can be made in its favor." Id. Instead, = "actual,=20 not presumed, conformance with [rule 42] remains . . . = indispensable."=20 Bernal, 22 S.W.3d at 435. We must ensure that the = district court=20 performed the required "rigorous analysis" before ruling on class=20 certification, as manifested in a detailed, thorough trial plan.=20 Peake, 178 S.W.3d at 778. The effect =
of=20
Dearing I's mandate In its first = issue, the=20 Department argues that the district court abused its discretion in = re-certifying the class on the same pleadings, evidence, and trial = plan on=20 which it had relied in Dearing I, in derogation of our = mandate.=20 We agree with the Department. The mandate is the = formal=20 command from an appellate court commanding the lower court to = comply with=20 the appellate court's judgment. See Tex. R. App. P. = 51.1(b),=20 65.2; In re Grossnickle, 115 S.W.3d 238, 243 (Tex.=20 App.--Texarkana 2003, orig. proceeding); Lewelling=20 v. Bosworth, 840 S.W.2d 640, 642-43 (Tex. App.--Dallas = 1992,=20 orig. proceeding); Dixie Gas & Fuel Co. v. Jacobs, 66 = S.W.2d=20 446, 448 (Tex. Civ. App.--Beaumont 1933, writ dism'd w.o.j.) = (citing=20 Black v. Epperson, 40 Tex. 162, 172-73 (Tex. 1874)). Upon = receiving the appellate court's mandate, the lower court has a = mandatory,=20 ministerial duty to enforce the appellate court's judgment. = See=20 Tex. R. App. P. 51.1(b); Grossnickle, 115 = S.W.3d at=20 243. It has no discretion to review, interpret, or enforce the = mandate=20 but, instead, must carry out the mandate. Grossnickle, = 115 S.W.3d=20 at 243. This Court's = mandate in=20 Dearing I recited its judgment that "the portion of the=20 [district] court's order pertaining to class certification is = reversed,=20 and that part of the cause is remanded for further proceedings = consistent=20 with this opinion. The remainder of the order is affirmed." For = further=20 guidance, the district court was obligated to look to the Court's = opinion.=20 Hudson v. Wakefield, 711 S.W.2d 628, 630 (Tex. 1986) = ("[C]ourts=20 should look not only to the mandate itself, but also to the = opinion of the=20 court."). The mandate concluded with, "we command you to observe = the order=20 of our Court of Appeals in this behalf and in all things have the = order=20 duly recognized, obeyed, and executed." This Court has not =
withdrawn=20
its mandate, nor has the judgment underlying it been reversed or =
vacated=20
by a higher appellate court. The district court = may have=20 perceived that Smith nonetheless undermined a central = premise of=20 Dearing I and rendered this Court's judgment erroneous. = If so, it=20 is understandable that the district court, perceiving a choice = between the=20 rationale expressed in an opinion of our nation's highest court = versus one=20 of this state intermediate appellate court, may have seen fit to = apply the=20 higher court's analysis. Such a view, however, would overlook the=20 implications of both our mandate and the law-of-the-case=20 doctrine. Under the = law-of-the-case=20 doctrine, a court of appeals is ordinarily bound by its initial = decision=20 on a question of law if there is a subsequent appeal in the same = case.=20 Briscoe v. Goodmark Corp., 102 S.W.3d 714, 716 (Tex. = 2003);=20 see also Loram Maint. of Way, Inc. v. Ianni, 210 = S.W.3d=20 593, 596 (Tex. 2006) ("[T]he 'law of the case' doctrine is that = principle=20 under which questions of law decided on appeal to a court of last = resort=20 will govern the case throughout its subsequent stages." (citing=20 Hudson, 711 S.W.2d at 630)). "By narrowing the issues in=20 successive stages of the litigation, the law of the case doctrine = is=20 intended to achieve uniformity of decision as well as judicial = economy and=20 efficiency. The doctrine is based on public policy and is aimed at = putting=20 an end to litigation." Briscoe, 102 S.W.3d at = 716. The = law-of-the-case doctrine=20 does not extend to questions of fact, nor does it necessarily = apply when=20 either the issues or the facts presented in subsequent appeals are = not=20 substantially the same as those involved on the first trial.=20 Hudson, 711 S.W.2d at 630. Thus, as the Department = suggests,=20 Dearing "could have redrawn [his] petition and asked the trial = court to=20 certify a class based on a claim under the Smith = standard; in=20 that case, the court's mandate would not have been an obstacle = because the=20 certification would be different." That is not the case here, = however. The=20 district court re-certified the class relying on the same = underlying=20 pleadings, trial plan, and evidence on which it had originally = certified=20 the class. Nonetheless, "[a] = decision=20 rendered on an issue before the appellate court does not = absolutely bar=20 re-consideration of the same issue on a second appeal," but = "[a]pplication=20 of the doctrine lies within the discretion of the court, depending = on the=20 particular circumstances surrounding that case." Id. A=20 longstanding exception to the law-of-the-case doctrine (or = instance when=20 courts will exercise their discretion not to apply it) is where = the=20 appellate court concludes, on the second appeal, that its original = decision was "clearly erroneous." Id. (citing = Galveston,=20 Harrisburg & San Antonio Ry. Co. v. Faber, 8 S.W. 64, 65 = (Tex.=20 1888)). The rationale underlying this exception is = that: It would be = unthinkable [for=20 the court] after having . . . reconsidered the case, and arrived = at the=20 conclusion that the opinion on the former appeal was clearly = erroneous, to=20 hold that it is bound by considerations of consistency to = perpetuate that=20 error. Our duty to administer justice under the law, as we = conceive it,=20 outweighs our duty to be consistent. Id. = (citing=20 Connecticut Gen. Life Ins. Co. v. Bryson, 219 S.W.2d 799, = 800=20 (Tex. 1949)). Under this exception, our sister courts have = revisited, on=20 appeals after remand, prior decisions called into question by = intervening=20 higher-court decisions. See In re Estate of Chavana, 993 = S.W.2d=20 311, 315-17 (Tex. App.--San Antonio 1999, no pet.); McCrea v. = Cubilla=20 Condo. Corp., 769 S.W.2d 261, 262-63 (Tex. App.--Houston [1st = Dist.]=20 1988, writ denied). Thus, while the=20 law-of-the-case doctrine contemplates situations where prior = appellate=20 court decisions on legal questions should be reconsidered in = appeals after=20 remand, it is the appellate court--not the lower court--who = decides=20 whether it is appropriate to do so. We sustain the Department's = first=20 issue. Revisiting =
Dearing I Dearing urges us = to revisit=20 Dearing I in light of Smith and affirm the = district=20 court's order as consistent with the current state of the law. We = agree=20 that we would effectuate the policies underlying the = law-of-the-case=20 doctrine by revisiting certain aspects of Dearing I and = should=20 exercise our discretion to do so. Disparate-impact=20
age-discrimination claims under the labor =
code When previously = concluding=20 that Dearing's disparate-impact age-discrimination claim was not = viable=20 and that certification was therefore an abuse of discretion, this = Court=20 relied on two basic premises: (1) the Fifth Circuit's analysis in=20 Smith was "persuasive" regarding whether disparate-impact = claims=20 are available under the ADEA; and (2) section 21.122(b) of the = labor code=20 means that "disparate-impact claims are available for age = discrimination=20 in this state only if they are available under the ADEA." = Dearing=20 I, 150 S.W.3d at 465. Section 21.122(b) of the labor code=20 provides: To determine the=20 availability of and burden of proof applicable to a disparate = impact case=20 involving age discrimination, the court shall apply the judicial=20 interpretation of the Age Discrimination in Employment Act of 1967 = and its=20 subsequent amendments (29 U.S.C. Section 621 et seq.). = Tex. Lab. Code =
Ann. =A7=20
21.122(b). The Department had argued that section 21.122 required =
us to=20
apply to the labor code the then-prevailing view of the Fifth =
Circuit and=20
other federal courts that the ADEA did not permit disparate-impact =
claims.=20
Dearing had sought to distinguish these federal decisions, =
emphasizing=20
that many had rested on the view that the ADEA's RFOA provision =
manifested=20
Congress's intent to prohibit disparate-impact claims under that =
statute.=20
See Dearing I, 150 S.W.3d at 463-64. Dearing pointed out =
that the=20
legislature had patterned the labor code's general employment=20
discrimination prohibition after section 703(a) of title VII The Court added = that section=20 21.122 "specifically mirrored" the textual distinctions between = the ADEA=20 and title VII following the 1991 Civil Rights Act amendments. = Id.=20 Specifically, following the 1991 amendments, the legislature had = made=20 corresponding amendments to Texas law that tracked the new = subsection=20 (k)(1) of title VII, section 703, but made these provisions = applicable=20 solely to claims for disparate-impact discrimination involving = protected=20 categories other than age. Act of May 14, 1993, 73d Leg., R.S., = ch. 276, =A7=20 5, 1993 Tex. Gen. Laws 1285, 1287 (current version at Tex. Lab. = Code Ann.=20 =A7 21.122(a), (c)-(d) (West 2006)); cf. 42 U.S.C.A. =A7=20 2000e-2(k)(1). In the aftermath = of=20 Smith, the Department concedes that disparate-impact = claims may=20 be available under the ADEA, and that--consistent with its = position in=20 Dearing I--section 21.122(b) incorporates this principle = to=20 govern such claims under the labor code. But the Department urges = that our=20 ultimate holdings in Dearing I were correct because the = district=20 court still abused its discretion in certifying the class. Central = to this=20 contention is the argument that the Department advances in its = second=20 issue: that section 21.122(b) incorporates into the labor code not = only=20 Smith's holdings regarding the availability of = disparate-impact=20 claims under the ADEA, but also its analysis of the plaintiffs' = burden of=20 proof. Specifically, the Department urges that Wards Cove = governs=20 the standards Dearing must meet to establish a prima facie=20 disparate-impact age-discrimination case and imposes a=20 burden-shifting framework for addressing any justifications the = Department=20 proffers. Moreover, it asserts that section 21.122(b) incorporates = the=20 ADEA's RFOA limitation, as interpreted by Smith, into the = labor=20 code. See Smith, 544 U.S. at 243 ("Unlike the business = necessity=20 test, which asks whether there are other ways for the employer to = achieve=20 its goals that do not result in a disparate impact on a protected = class,=20 the reasonableness inquiry includes no such requirement."). = Relatedly, the=20 Department argues that its RFOA justification is addressed in the = same=20 manner under the ADEA as was the business-necessity justification = under=20 Wards Cove--the defendant has the burden of = production, but=20 the plaintiff retains the ultimate burden of proof to prove the=20 unreasonableness of any proffered RFOA. Based on these = contentions, the=20 Department complains in its third issue that the trial plan on = which=20 certification was based was defective because it failed to = properly=20 address the elements of Dearing's disparate-impact = age-discrimination=20 claim and the RFOA justification. See Tex. R. Civ. = P.=20 42(c)(1)(D); Peake, 178 S.W.3d at 777; Hankins,=20 111 S.W.3d at 72. Dearing's = arguments largely=20 parallel those that he advanced in Dearing I, emphasizing = the=20 textual similarities between section 21.051(a)(2) of the labor = code,=20 section 703(a)(2) of title VII, and section 623(a)(2) of the ADEA; = the=20 legislature's omission of an express RFOA provision in the labor = code=20 while including the Griggs "business necessity" = limitation; and=20 his assertion that the labor code's age-discrimination provisions, = unlike=20 the ADEA, share common legislative and policy origins with those=20 addressing other protected classes. Dearing does not seem to = dispute that=20 Wards Cove would govern proof of his claim. Instead, he = contends=20 that the labor code does not incorporate an RFOA limitation and = that, if=20 it does, the RFOA is an affirmative defense on which the = Department would=20 have the burdens of proof and persuasion. We agree that = Dearing I=20 was clearly erroneous in its reliance on pre-Smith=20 jurisprudence holding that disparate-impact claims were = categorically=20 unavailable under the ADEA. See Chavana, 993 S.W.2d at = 315-17;=20 McCrea, 769 S.W.2d at 262-63. However, we conclude that=20 Dearing I was correct in its construction of section = 21.122(b) of=20 the labor code and that this provision was also intended to = incorporate=20 the ADEA's proof standards as interpreted by Smith-- = including=20 the RFOA justification. Statutory = construction=20 presents a question of law that we review de novo. State=20 v. Shumake, 199 S.W.3d 279, 284 (Tex. 2006). We seek to = discern=20 the legislature's intent, as manifested first and foremost in the=20 statutory text. Id. We ascertain the legislature's intent = from=20 the plain meaning of the words chosen when possible. Id. = To that=20 end, we consider statutory language in context, not in isolation.=20 Jones v. Fowler, 969 S.W.2d 429, 432 (Tex. 1988); = see=20 Tex. Gov't Code Ann. =A7 311.011(a) (West 2005). We also presume = that the=20 legislature acted with knowledge of the background law. = Acker v.=20 Texas Water Comm'n, 790 S.W.2d 299, 301 (Tex. 1990). Words=20 and phrases that have acquired a technical or particular = meaning=20 shall be construed accordingly. Tex. Gov't Code Ann. =A7 = 311.011(b). When=20 ascertaining legislative intent, we may also consider the = objective of the=20 law, its history, and the consequences of a particular = construction.=20 Id.; see also id. =A7 311.023(1), (3), (5) (West = 2005). The Texas Supreme =
Court has=20
frequently observed that the Texas Commission on Human Rights Act =
(TCHRA)=20
and its current incarnation, chapter 21 of the labor code, were =
intended=20
to "correlat[e] . . . state law with federal law in the area of=20
discrimination in employment," Schroeder v. Texas Iron Works,=20
Inc., 813 S.W.2d 483, 485 (Tex. 1991), and "coordinate and =
conform=20
with federal law under Title VII . . . and the Age Discrimination =
in=20
Employment Act." Caballero v. Central Power & Light =
Co., 858=20
S.W.2d 359, 361 (Tex. 1993). The legislature, in fact, specified =
"general=20
purposes" of the statute that include "provid[ing] for the =
execution of=20
the policies of Title VII of the Civil Rights Act of 1964 and its=20
subsequent amendments (42 U.S.C. Section 2000e et. seq.)," As Dearing = emphasizes, much=20 of chapter 21 appears to track title VII. Section 21.051, its = general=20 employment-discrimination prohibition, states: An employer = commits an=20 unlawful employment practice if because of race, color, = disability,=20 religion, sex, national origin, or age the employer: (1) fails or = refuses to hire=20 an individual, discharges an individual, or discriminates in any = other=20 manner against an individual in connection with compensation or = the terms,=20 conditions, or privileges of employment; or (2) limits, = segregates, or=20 classifies an employee or applicant for employment in a manner = that would=20 deprive or tend to deprive an individual of any employment = opportunity or=20 adversely affect in any other manner the status of an=20 employee. Tex. Lab. Code = Ann. =A7=20 21.051. Section 21.051 "is substantively identical to its federal=20 equivalent in Title VII," but adds age and disability to the = protected=20 categories. Toennies, 47 S.W.3d at 475; cf. 42 = U.S.C.A.=20 =A7 703(a). Subsection (2) of section 21.051 tracks section = 703(a)(2) of=20 title VII, the provision that the United States Supreme Court has = long=20 identified as the textual basis for the disparate-impact liability = theory.=20 Smith, 544 U.S. at 235 (citing Watson, 487 U.S. = at 991).=20 Language parallel to section 703(a)(2) in the ADEA, the = Smith=20 court observed, "strongly suggests that a disparate-impact theory = should=20 be cognizable under the ADEA." Id. at 236. Furthermore, = in=20 codifying the Griggs "business necessity" concept, the=20 legislature implicitly recognized the disparate-impact liability = theory.=20 See Tex. Lab. Code Ann. =A7 21.115 ("An employer does not = commit an=20 unlawful employment practice by engaging in a practice that = has a=20 discriminatory effect and that would otherwise be = prohibited . .=20 . .") (emphasis added); see also Helena Chem Co. v. = Wilkins, 47=20 S.W.3d 486, 497 (Tex. 2001) ("[W]hen the Legislature looks to = another=20 jurisdiction's statute, but modifies rather than adopts some of = its=20 provisions, it does so purposefully."). However, the only =
provision=20
in chapter 21 that explicitly addresses the availability of or =
burden of=20
proof for disparate-impact employment-discrimination claims is =
section=20
21.122--and the only provision that specifically addresses such =
issues for=20
disparate-impact age-discrimination claims is section 21.122(b). =
The=20
provision that is now section 21.122 was added to the TCHRA in =
1993 as=20
part of a package of amendments intended to conform the act to the =
1991=20
Civil Rights Act and the 1990 Americans With Disabilities Act. Act =
of May=20
14, 1993, 73d Leg., R.S., ch. 276, =A7 5, 1993 Tex. Gen. Laws =
1285, (current=20
version at Tex. Lab. Code Ann. =A7 21.122 (West 2006)). The =
legislature's=20
desire to make Texas employment discrimination law consistent with =
its=20
federal counterparts is repeatedly demonstrated in the text and =
structure=20
of the amendments. The provision that = is now=20 section 21.122, with the exception of subsection (b), is = substantively=20 identical to the new section 703(k)(1) that Congress added to = title VII in=20 response to Wards Cove: Sec. 5.11. BURDEN = OF PROOF=20 IN DISPARATE IMPACT CASES. (a) An unlawful employment practice = based on=20 disparate impact is established under this Act only if: = (1) a complainant=20 demonstrates that a respondent uses a particular employment = practice that=20 causes a disparate impact on the basis of race, color, sex, = national=20 origin, religion, or disability and the respondent fails to = demonstrate=20 that the challenged practice is job-related for the position in = question=20 and consistent with business necessity; or (2) the = complainant makes=20 the demonstration in accordance with federal law as that law = existed on=20 June 4, 1989, with respect to the concept of alternative = employment=20 practices, and the respondent refuses to adopt such an alternative = employment practice. * * = * (c) To demonstrate = that a=20 particular employment practice causes a disparate impact, the = complainant=20 must demonstrate that each particular challenged employment = practice=20 causes a disparate impact, except that if the complainant = demonstrates to=20 the satisfaction of the court that the elements of a respondent's=20 decision-making process are not capable of separation for = analysis, that=20 decision-making process may be analyzed as one employment=20 practice. (d) If the = respondent=20 demonstrates that a specific practice does not cause a disparate = impact,=20 the respondent may not be required to demonstrate that the = practice is=20 consistent with business necessity. Act of May 14, = 1993, 73d=20 Leg., R.S., ch. 276, =A7 5, 1993 Tex. Gen. Laws 1285, 1287-88 = (current=20 version at Tex. Lab. Code Ann. =A7 21.122 (West 2006)); = cf. 42=20 U.S.C.A =A7 2000e-2(k)(1). Other portions of new subsection (k) = were also=20 replicated in the TCHRA, including a provision clarifying that = "[a]=20 demonstration that an employment practice is consistent with = business=20 necessity may not be used as a defense under this Act against a = complaint=20 of intentional discrimination." Act of May 14, 1993, 73d Leg., = R.S., ch.=20 276, =A7 5, 1993 Tex. Gen. Laws 1285, 1288 (current version at = Tex. Lab.=20 Code Ann. =A7 21.123 (West 2006)); cf. 42 U.S.C.A. =A7 = 2000e-2(k)(2)=20 (West 2003). But the amendments did not track only federal changes = that=20 tended to expand liability exposure. To the contrary, the = legislature also=20 incorporated portions of subsection (k) and the 1991 act that = limited=20 employers' liability. These included a new liability protection = regarding=20 employers' anti-drug policies, Act of May 14, 1993, 73d Leg., = R.S., ch.=20 276, =A7 4, 1993 Tex. Gen. Laws 1285, 1887 (current version at = Tex.=20 Lab. Code Ann. =A7 21.120 (West 2006)); cf. 42 U.S.C.A. = =A7=20 2000e-2(k)(3) (West 2003), and a prohibition on damage awards, = back pay,=20 and reinstatement in certain mixed-motive cases. Act of May 14, = 1993, 73d=20 Leg., R.S., ch. 276, =A7 5, 1993 Tex. Gen. Laws 1285, 1288 = (current version=20 at Tex. Lab. Code Ann. =A7 21.125 (West 2006)); = cf. 42=20 U.S.C.A. =A7=A7 2000e-2(m), 2000e-5(g)(2)(B) (West = 2003). As noted in = Smith,=20 Congress did not make changes to the ADEA corresponding to the new = section=20 703(k) it added to Title VII. In keeping with its intent to retain = consistency with federal law, the legislature, as this Court = observed in=20 Dearing I, "specifically mirrored" this "textual = distinction=20 between the ADEA and Title VII" by adopting "the language added to = Title=20 VII in 1991 [but] treat[ing] disparate impact on the basis of age=20 distinctly by removing it from the list of other forms of = discrimination=20 that give rise to disparate-impact liability." 150 S.W.3d at 465. = The=20 legislature provided in subsection (b) of section 21.122 that, "To = determine the availability of and burden of proof applicable to a=20 disparate impact case involving age discrimination, the court = shall apply=20 the judicial interpretation of the Age Discrimination in = Employment Act of=20 1967 and its subsequent amendments (29 U.S.C. Section 621 et = seq.)." Tex.=20 Lab. Code Ann. =A7 21.122(b). Ultimately, the = parties'=20 dispute over the construction of section 21.122(b) turns on the = meaning of=20 the "judicial interpretation of the Age Discrimination in = Employment Act of 1967 and its subsequent amendments" that we = "shall=20 apply" to "determine the availability of and burden of proof = applicable to=20 a disparate impact case involving age discrimination." Dearing = maintains=20 that the relevant ADEA "judicial interpretation" in = Smith=20 that we must apply "is simply the analysis of a provision = of the=20 federal statute that exists nowhere in the Texas Labor Code," and = that is=20 therefore distinguishable. The Department contends that section = 21.122(b)=20 requires us to follow Smith's holdings regarding = the=20 availability and burden of proof for ADEA disparate-impact=20 claims--including the portions of the court's analysis that = reference the=20 RFOA provision. As in Dearing I, we agree with the = Department's=20 construction of section 21.122(b). The legislature = manifested=20 its intent throughout the 1993 amendments to the TCHRA that Texas=20 employment-discrimination law conform to federal law in the = aftermath of=20 the 1991 Civil Rights Act. The conforming changes that the = legislature=20 made included not only those expanding liability exposure, but = also those=20 restricting it. The legislature added a new provision specifically = to=20 address the availability and burden of proof in disparate-impact = claims=20 and, like Congress, chose to treat age-discrimination claims = differently=20 from those involving other protected classes. The federal analogue = that=20 the legislature identified for age-discrimination claims, = moreover, was=20 not title VII, but the "judicial interpretation of the = Age=20 Discrimination in Employment Act of 1967 and its subsequent=20 amendments." If, as Dearing = contends, the=20 legislature had intended that Texas courts "apply" the ADEA = "judicial=20 interpretation" only to the extent that the ADEA is textually = parallel to=20 the TCHRA, it would have undermined its own manifest goal to = restore=20 consistency between Texas and federal employment-discrimination = law. By=20 the time of the 1993 amendments, as noted, there was already = considerable=20 jurisprudential controversy regarding the availability of = disparate-impact=20 claims under the ADEA, with the RFOA provision and other = distinguishing=20 features of the ADEA being focal points of the debate. See=20 Markham, 451 U.S. 945 (Rehnquist, J., dissenting from denial = of=20 certiorari); Metz, 828 F.2d at 1216-20; see generally = Herbert & Shelton, supra, at 636-50. While the = 1993=20 TCHRA amendments were pending before the legislature, furthermore, = the=20 Supreme Court handed down its Hazen Paper decision, which = was=20 viewed by many as validating the arguments being made against=20 disparate-impact claims under the ADEA. We presume that the = legislature is=20 aware of the background law when it enacts a statute. = Acker, 790=20 S.W.2d at 301. Especially given the jurisprudential environment = that=20 existed at the time of the 1993 amendments, it is doubtful that a=20 legislature intending to keep Texas employment-discrimination law=20 consistent with its federal counterpart would require Texas courts = to=20 apply ADEA "judicial interpretation" while contemplating that = these cases=20 could be deemed distinguishable and inapplicable. Such = inconsistency would=20 have been further compounded by the legislature's unequivocal = mandate=20 that courts apply the "judicial interpretation of the Age = Discrimination in Employment Act of 1967 and its subsequent=20 amendments," without regard to whether those future = amendments might=20 be consistent with the TCHRA. Considering, as we = must, the=20 role of section 21.122(b) in context with the 1993 TCHRA = amendments as a=20 whole, see Jones, 969 S.W.2d at 432, the more plausible=20 construction of "judicial interpretation of the Age=20 Discrimination in Employment Act of 1967 and its subsequent = amendments" is=20 that we apply the authoritative holdings governing availability = and burden=20 of proof for ADEA disparate-impact claims as the standards = governing the=20 same issues for such claims under the labor code, without regard = to what=20 might otherwise be distinguishing differences in the underlying = statutory=20 texts. What the legislature intended in section 21.122(b), in = other words,=20 was for Texas law to track federal law regarding the availability = of and=20 burden of proof in disparate-impact age-discrimination cases, in = effect=20 incorporating not only the ADEA's textual features presently = governing=20 those issues, but even their "subsequent amendments." This = conclusion is=20 consistent with Dearing I's construction of section = 21.122(b).=20 Similarly, while Dearing's arguments emphasize textual parallels = between=20 the THCRA and title VII that might have been significant if = considered in=20 isolation, we agree with the Dearing I Court that Dearing = "would=20 have us ignore section 21.122" and its impact. Dearing I, = 150=20 S.W.3d at 465. Consequently, = Dearing must=20 establish a prima facie case under the standards of Wards = Cove,=20 and the Department may invoke the RFOA limitation, as interpreted = in=20 Smith, as a justification. We are also persuaded by the=20 prevailing post-Smith case law that the RFOA provision = must=20 operate in the same way as the business-necessity justification = under=20 Wards Cove; that is, the Department has the initial = burden of=20 production regarding this justification, but Dearing retains the = ultimate=20 burden of proof to demonstrate that any proffered RFOA was = unreasonable.=20 See Meacham v. Knolls Atomic Power Lab., 461 = F.3d 134,=20 141-43 & n.7 (2d Cir. 2006) (noting that in Smith, = Supreme=20 Court stated that bona fide occupational qualification was = affirmative=20 defense but did not similarly identify RFOA as affirmative defense = and=20 further, it is "hard to see how an ADEA plaintiff can expect to = prevail on=20 a showing of disparate impact based on a factor that correlates = with age=20 without also demonstrating that the factor is unreasonable."); = Pippin=20 v. Burlington Res. Oil & Gas Co., 440 F.3d 1186, 1200 = (10th Cir.=20 2006) (holding that "to prevail on an ADEA disparate impact claim, = an=20 employee must ultimately persuade the factfinder that the = employer's=20 asserted basis for the neutral policy is unreasonable."); = Durante v.=20 Qualcomm, Inc., 144 Fed. Appx. 603, 607 (9th Cir. 2005) = (ruling in=20 favor of employer that produced "unrebutted evidence" that its = termination=20 decisions were made to satisfy differing business needs of its = divisions=20 and departments); see also Marshall v. Westinghouse Elec. = Corp.,=20 576 F.2d 588, 590 (5th Cir. 1978) ("This circuit has consistently = held=20 that once the plaintiff makes out such a prima facie case the = defendant=20 bears the burden of 'going forward' to demonstrate reasonable = factors=20 other than age for the plaintiff's discharge. Just as consistently = we have=20 said that the burden of persuasion, often called the risk of=20 non-persuasion, never shifts; it remains upon the ADEA = plaintiff.").=20 Dearing relies on three cases, none of which address Wards = Cove,=20 to argue that the RFOA is an affirmative defense on which the = Department=20 has the burden of persuasion. See Johnson v. Perkins Rests.,=20 Inc., 815 F.2d 1220, 1221 (8th Cir. 1987); Criswell v. = Western=20 Airlines, Inc., 709 F.2d 544, 552 (9th Cir. 1983); see = also Kimel=20 v. Florida Bd. of Regents, 528 U.S. 62, 87 (2000) (discussing = bona=20 fide occupational qualification as affirmative defense). All of = these=20 cases, moreover, preceded the Supreme Court's opinion in=20 Smith. Because the = district court's=20 trial plan does not sufficiently address these elements, it abused = its=20 discretion in certifying the class. We sustain the Department's = second and=20 third issues. The =
Department's=20
jurisdictional arguments In its fourth = issue, the=20 Department adds that under Smith's requirements, as = incorporated=20 into the labor code through section 21.122(b), Dearing has not = pleaded,=20 and cannot plead, a valid claim for disparate-impact = age-discrimination,=20 rendering his claim not viable, see Lopez, 156 = S.W.3d at=20 557, and barred by sovereign immunity. See Texas Dep't of = Parks &=20 Wildlife v. Miranda, 133 S.W.3d 217, 226 (Tex. 2004) (citing=20 Texas Ass'n of Bus. v. Texas Air Control Bd., 852 S.W.2d = 440, 446=20 (Tex. 1993)); see also Tex. Lab. Code Ann. =A7 = 21.002(8)(D)=20 (West 2006). The Department relies on challenges to both the=20 sufficiency of Dearing's pleading allegations and underlying=20 jurisdictional facts. See Miranda, 133 S.W.3d at 227 = (citing=20 Bland Indep. Sch. Dist. v. Blue, 34 S.W.3d 547, 555 = (Tex.=20 2000)). To that end, it asks us to consider the evidence it = attached to=20 its pre-Smith, pre-certification plea to the = jurisdiction,=20 summary-judgment motions, and special exceptions. While = styling these=20 arguments as challenges to class certification, the Department=20 also asks us to dismiss Dearing's claim for want of = subject-matter=20 jurisdiction, or at least remand to afford him the = opportunity to=20 replead in accordance with Smith. See Miranda,=20 133 S.W.3d at 226-27. The Department = acknowledges=20 that "the parties [have] not address[ed] the jurisdictional = issues" in the=20 district court after Smith "or the propriety of = Plaintiffs'=20 attempts to certify a class based [on] pleadings that do not = mention=20 Smith's requirements." It attributes the context in which = it has=20 raised these jurisdictional issues to the limited scope of our = Dearing=20 I mandate, observing that the "remand proceedings only = involved the=20 propriety of re-certifying the class." Nonetheless, the Department = urges=20 that because these issues implicate sovereign immunity and, = therefore,=20 subject-matter jurisdiction, we may address them for the first = time on=20 appeal. See Texas Ass'n of Bus. v. Texas Air Control Bd., = 852=20 S.W.2d 440, 446 (Tex. 1993). In effect, the = Department is=20 seeking to re-urge, in light of Smith, its = pre-Smith=20 plea to the jurisdiction augmented by new challenges to = jurisdictional=20 facts that it seeks to raise for the first time on appeal. This = Court=20 recently held that where a defendant's challenge to jurisdictional = facts=20 also implicates the merits of a plaintiff's claim, = Miranda=20 requires that the challenge be raised first in the trial court = rather than=20 on appeal. Hendee v. Dewhurst, ___ S.W.3d. ___, ___, No.=20 03-06-00501-CV, 2007 Tex. App. LEXIS 4149, at*53-54 (Tex. = App.--Austin May=20 25, 2007, pet denied) (op. on reh'g). That is the case here--the=20 Department seeks to conclusively establish that it relied on an = RFOA,=20 which, if successful, would bar liability for any disparate = effects of the=20 reclassifications that Dearing challenges. Nor can we reach = these=20 dispositive issues in the guise of determining the "viability" of=20 Dearing's class claims. The supreme court has instructed us that=20 "dispositive issues should be resolved by the trial court = before=20 certification is considered." Lopez, 156 S.W.3d at 557 = (emphasis=20 added). Contrary to the Department's suggestions, Lopez = does not=20 create a new procedural means by which appellate courts can = adjudicate the=20 merits of dispositive issues not otherwise within their = jurisdiction to=20 consider. Instead, it envisions that such issues should be = adjudicated in=20 the trial court in the first instance, through the established = procedural=20 mechanisms under our rules--such as pleas to the jurisdiction,=20 summary-judgment motions, and special exceptions--rather than by = what are=20 substantively the same proceedings initiated at the appellate = level.=20 Cf. Lopez, 156 S.W.3d at 157 (declining to reach = viability issues=20 and remanding so trial court could address pending plea to the=20 jurisdiction and special exceptions). Furthermore, the =
concept of=20
viability addressed in Lopez emanates from the core =
requirement=20
that, before certification, trial courts perform a "rigorous =
analysis" to=20
determine whether rule 42's requirements are met. Bernal, =
22=20
S.W.3d at 435. To "make a meaningful determination of the =
certification=20
issues," Peake, 178 S.W.3d at 778, trial courts must =
resolve=20
disputes affecting the underlying substantive law prior to =
certification=20
because "courts can hardly evaluate the claims, defenses or =
applicable law=20
without knowing what the law is." Lapray, 135 S.W.3d at =
672. The=20
impact of recent cases affecting the controlling law must be =
considered.=20
Hankins, 111 S.W.3d at 72. The district court's trial =
plan does=20
not reflect any consideration of Smith's implications for =
Dearing's claim, beyond allowing the claim (in derogation of our =
mandate)=20
to proceed on a class basis. In fact, the court's re-certification =
order=20
merely attached and incorporated a trial plan that predated=20
Smith. Even under the view of Smith's effects =
accepted=20
by Dearing, the trial plan falls short. For example, the elements =
for=20
establishing a prima facie case under Wards Cove are not=20
addressed, nor is the burden-shifting framework it requires. The Department = will have the=20 opportunity on remand to re-urge its dispositive motions in light = of=20 Smith. Conversely, Dearing will have the opportunity to = amend his=20 pleadings and otherwise respond to the Department's potentially=20 dispositive issues under the normal procedural framework that our = rules=20 provide to protect and balance the interests of both plaintiffs = and=20 defendants. Cf. Hendee, ___S.W.3d at ___, 2007 Tex. App. = LEXIS=20 4149, at *53-54. The district court's disposition of those issues, = in=20 turn, will inform its "rigorous analysis" of whether the class = should be=20 certified. We overrule the Department's fourth = issue. Single-filing=20
rule In its fifth =
issue, the=20
Department argues that we should revisit, as "clearly erroneous,"=20
Dearing I's holding that the claims of putative class =
members=20
other than Dearing were not barred by their failure to exhaust=20
administrative remedies. The supreme court has held that the =
provisions=20
now codified in chapter 21 of the labor code, like title VII, =
impose a=20
comprehensive and exclusive administrative scheme under which=20
employment-discrimination claimants must first exhaust their =
remedies=20
before filing a civil action. Schroeder, 813 S.W.2d at =
486-88.=20
Failure to exhaust these remedies is a jurisdictional bar to suit. =
Id. at 488. In the district court, the Department, in =
support of=20
its plea to the jurisdiction, presented undisputed evidence that =
no class=20
member other than Milburn Dearing had filed a complaint with the =
human=20
rights commission. In affirming the district court's denial of the =
plea in=20
Dearing I, this Court purported to "adopt the =
single-filing rule=20
fashioned by federal courts" whereby similarly-situated persons =
can, under=20
certain circumstances, "piggyback" onto a single plaintiff's =
filing of an=20
EEOC complaint under title VII or the ADEA. Dearing I,=20
150 S.W.3d at 460; see Mooney v. Aramco Servs. =
Co.,=20
54 F.3d 1207, 1223 (5th Cir. 1995). Dearing = I's=20 "adoption" of the single-filing rule was predicated principally on = (1) a=20 view that "a person's 'agent' could reasonably include a class=20 representative" under section 21.201 of the labor code; and (2) = what the=20 Court regarded as the beneficial policies served by the rule in = federal=20 courts. 150 S.W.3d at 460. We agree with the concurrence that = Texas courts=20 are not in a position to incorporate extra-statutory requirements = into the=20 labor code. ___ S.W.3d ___ (Waldrop, J., concurring). Our proper = inquiry=20 is, instead, to ascertain the policies that the legislature = intended to=20 advance in the labor code, as manifested first and foremost by the = statutory text, and as further discerned through our application = of the=20 established statutory construction principles we have reviewed=20 above. Section 21.201 = provides that=20 "a person claiming to be aggrieved by an unlawful employment = practice=20 or the person's agent may file a complaint with the = commission."=20 Tex. Lab. Code Ann. =A7 21.201 (West 2006) (emphasis added). As = the=20 Department observes, "agent" under Texas law ordinarily denotes a=20 relationship based upon a principal's manifested consent that the = agent=20 act on his behalf. See Bhalli v. Methodist = Hosp., 896=20 S.W.2d 207, 210 (Tex. App.--Houston [1st Dist.] 1995, writ. = denied). Under=20 traditional agency principles, as the Department suggests, a class = representative "filing the complaint is not necessarily in an = agency=20 relationship with the other members of the purported class." = Indeed,=20 especially in the early stages of litigation, members of the = putative=20 class will frequently have no knowledge of their purported=20 representative's actions. See Tex. R. Civ. P. = 42(c)(2)(B),=20 (e)(3)-(4). Thus, the Department suggests, section 21.201 could = not have=20 been intended to allow class-wide exhaustion of administrative = remedies=20 through a single filing, absent pleadings and proof establishing = that the=20 filer was acting as an agent of each class member. This intent, the = Department=20 argues, is further demonstrated by comparing section 21.201 to the = administrative-exhaustion requirements of the ADEA. As originally = enacted,=20 the ADEA provided that "[n]o civil action may be commenced by any=20 individual under this section until the individual has = given the=20 Secretary [of Labor] not less than sixty days' notice of an intent = to file=20 such action." Age Discrimination in Employment Act of 1967, Pub. = L. No.=20 202, =A7 7(d), 81 Stat. 602, 605 (current version at 29 U.S.C.A. = =A7 626(d)=20 (West 1998)) (emphasis added). In 1978, Congress amended this = provision=20 into its current form: "No civil action may be commenced by an = individual=20 under this section until 60 days after a charge alleging = unlawful=20 discrimination has been filed [with the EEOC]." Age = Discrimination in=20 Employment Act Amendements of 1978, Pub. L. No. 95-256, =A7 4(b) = 92 Stat.=20 189, 190 (current version at U.S.C.A. =A7 626(d)) (West 1998) = (emphasis=20 added). The Department suggests that Congress amended the ADEA=20 specifically to permit class actions under the single-filing rule, = and=20 there is some support for this view. See Tolliver v. Xerox = Corp.,=20 918 F.2d 1052, 1056 (2d Cir. 1990). Although not disputing = that=20 "[t]he federal courts now universally hold that an individual who = has not=20 filed an administrative charge can opt-in to a suit filed by a = similarly=20 situated plaintiff" under the single-filing rule, see=20 Mooney, 54 F.3d at 1223, the Department attributes these=20 developments to the 1978 ADEA amendments, and distinguishes = section 21.201=20 on that basis. We conclude, = however, that=20 section 21.201's closer federal analogue is section 706(b) of = title VII.=20 See 42 U.S.C.A. =A7 2000e-5(b). As the Texas Supreme = Court observed=20 in Schroeder, the employment-discrimination provisions of = the=20 labor code, like title VII, do not contain an explicit=20 exhaustion-of-remedies requirement similar to the ADEA's. 813 = S.W.2d at=20 487 & n.9. Instead, the court determined that the overall = structure of=20 the Texas administrative procedures resembled those of title VII, = observed=20 that the United States Supreme Court had held that title VII's = provision=20 required exhaustion of remedies, emphasized the legislature's = explicit=20 intent to provide for the execution of title VII's policies and = concluded=20 that the Texas law imposes an administrative-exhaustion = requirement akin=20 to title VII. Id. at 487. Section 706(d) of = title VII=20 resembles section 21.201 of the labor code. It provides that a = "charge"=20 satisfying title VII's administrative-exhaustion requirements can = be=20 "filed by or on behalf of a person claiming to be aggrieved." 42 = U.S.C.A.=A7=20 2000e-5(b). The phrase "or on behalf of" was added in the = Equal=20 Employment Opportunity Act of 1972. See Pub. L. No. = 92-261, sec.=20 4(a), =A7 706(a)-(g), 86 Stat. 103, 104. As originally enacted in = 1964,=20 section 706 had stated that a "charge" is filed only "by a person = claiming=20 to be aggrieved." Civil Rights Act of 1964, Pub. L. 88-352, = =A7 706(a),=20 78 Stat. 241, 259. Even before the 1972 amendment, federal courts = had=20 recognized the single-filing rule under section 706. See Oatis = v.=20 Crown Zellerbach Corp., 398 F.2d 496, 497-99 (5th Cir. 1968); = see=20 also Albermarle Paper Co. v. Moody, 422 U.S. 405, 414 n.8 = (1975)=20 (noting that "[t]he Courts of Appeals . . . are unanimous in = recognizing=20 that backpay may be awarded on a class basis under Title VII = without=20 exhaustion of administrative procedures by the unnamed class = members" and=20 suggesting that "Congress plainly ratified this construction of = the Act in=20 the course of enacting the Equal Employment Opportunity Act of=20 1972"). The similarities =
between the=20
labor code's administrative provisions and those of title VII, =
like others=20
throughout each statute, cf. Toennies, 47 S.W.3d =
at 475,=20
reflect the legislature's intent to "provide for the execution of =
the=20
policies of Title VII of the Civil Rights Act of 1964 and its =
subsequent amendments (42 U.S.C. Section 2000e et. seq.)" in =
regard to=20
exhaustion of administrative remedies. Schroeder, 813 =
S.W.2d at=20
486-88. Both before and after the 1983 enactment of the TCHRA, the =
single-filing rule was well-established in title VII cases. We conclude that = the labor=20 code manifests the legislature's intent to incorporate=20 the single-filing rule from title VII jurisprudence. As we = explained=20 in Dearing I, the single-filing rule allows a person who = has not=20 filed an administrative charge to piggyback on another party's=20 timely-filed administrative charge, if the person attempting to = piggyback=20 is similarly situated to the person who actually filed the = administrative=20 charge, and the charge provides notice of the collective or = class-wide=20 nature of the charge. 150 S.W.3d at 460. Here the plaintiffs are = similarly=20 situated to Dearing for the purposes of the single-filing rule = because=20 they all share the same grievance: that the Department's = reclassification=20 of the former Field Sergeant Game Wardens from the C-7 to the C-6 = level=20 constituted unlawful age discrimination that had a = disparate-impact on=20 employees over the age of forty. See = Crawford, 660=20 F.2d at 665 (holding that plaintiffs were "similarly situated"=20 for purposes of single-filing rule because "the gravamen of = their=20 complaints"--that they were given improper seniority dates and = passed over=20 for promotion because of their race--was "the same"); = Oatis, 398=20 F.2d at 498 (noting that where employees all had same grievance = "it would=20 be wasteful, if not vain" to require each employee to process = identical=20 complaints with EEOC). Furthermore, Dearing's charge gave notice = of the=20 class-wide nature of the charge. We thus agree with Dearing=20 I's ultimate holding that the single-filing rule = applies to=20 Milburn Dearing's complaint and that his complaint adequately = stated=20 its class-action intent. 150 S.W.3d at 460. We overrule the = Department's=20 fifth issue. Other = certification=20 issues Because = Smith's=20 impact on Dearing's claim and the Department's defenses will be = integral=20 to the district court's consideration of class certification on = remand, we=20 will defer further analysis of the propriety of certification = until that=20 issue is again before us. Nonetheless, we observe that the = district court=20 order reinstated, without modification, a certification order that = predated the October 2003 amendments to rule 42, and that does not = comply=20 with the amended rule. See Tex. R. Civ. P. 42(c)(1)(D). = Among=20 other defects, the plan fails to state the other available methods = of=20 adjudication or adequately explain why a class action is "superior = to=20 other available methods for the fair and efficient adjudication of = the=20 controversy." See Tex. R. Civ. P. 42(b)(3), (c)(1)(D). In = particular, we observe that of the approximately 130 members of = the=20 putative class, eighty-eight have already joined as plaintiffs. = Finally,=20 we note that the trial plan purports to set discovery deadlines = and a=20 trial date in 2003. We trust that if the district court reaches = the issue=20 of certification again on remand, it will comply with amended rule = 42.
We reverse the = district=20 court's order reinstating its prior class-certification order. On = remand,=20 the parties will have the opportunity to address the impact of=20 Smith and this decision on the adequacy of their = pleadings, the=20 district court's subject-matter jurisdiction, and any other = dispositive=20 matters. The parties will then have the opportunity to address the = impact=20 of these rulings and Smith on certification. We remand = these=20 issues to the district court for further proceedings consistent = with this=20 opinion. Before Chief = Justice Law,=20 Justices Pemberton and Waldrop; Concurring Opinion = by=20 Justice Waldrop Reversed and=20 Remanded Filed: August 3,=20 2007 1. See Kimel v. Florida Bd. of = Regents, 528=20 U.S. 62, 83-84 (2000).=20 2. Dearing filed a notice of appeal of the = district=20 court's ruling granting the Department's plea to the jurisdiction=20 regarding his declaratory-judgment and mandamus claims, but not = his=20 breach-of-contract claim. He later withdrew this notice.=20 3. We also held that the rule of = Kimel did=20 not extend to suits under state anti-discrimination laws and that = "the=20 Department has not pointed us to any legislative or statutory = references=20 from which we can conclude that its reclassification actions were = required=20 by law." Dearing I, 150 S.W.3d at 460-61.=20 4. See Maresco v. Evans = Chemetics,=20 964 F.2d 106, 115 (2d Cir. 1992); MacPherson = v. University of=20 Montevallo, 922 F.2d 766, 771 (11th Cir. 1991); Wooden v. = Board=20 of Ed. of Jefferson County, 931 F.2d 376, 379 (6th Cir.1991); = Arnold v. United States Postal Service, 863 F.2d 994, 998 = (D.C.=20 Cir. 1988) (assuming disparate-impact theory); Blum v. Witco = Chemical=20 Corp., 829 F.2d 367, 372 (3d Cir. 1987); Holt v. Gamewell = Corp., 797 F.2d 36, 37 (1st Cir. 1986); Palmer v. United=20 States, 794 F.2d 534, 536 (9th Cir. 1986); Monroe v. = United=20 Airlines, 736 F.2d 394, 404 n.3 (7th Cir. 1984); Dace v. = ACF=20 Industries, 722 F.2d 374, 378 (8th Cir. 1983), = modified, 728=20 F.2d 976 (1984) (per curiam). 5. But see Tex. R. Civ. P. 42(i), = (j).=20 6. In fact, after issuing its Smith = opinion,=20 the Supreme Court did not vacate or otherwise disturb our = Dearing=20 I judgment in light of Smith, but denied certiorari. = Dearing, 540 U.S. 960 (2005).=20 7. The Texas Labor Code's general = prohibition against=20 employment discrimination states: An employer = commits an=20 unlawful employment practice if because of race, color, = disability,=20 religion, sex, national origin, or age the employer: (1) fails or = refuses to hire=20 an individual, discharges an individual, or discriminates in any = other=20 manner against an individual in connection with compensation or = the terms,=20 conditions, or privileges of employment; or (2) limits, = segregates, or=20 classifies an employee or applicant for employment in a manner = that would=20 deprive or tend to deprive an individual of any employment = opportunity or=20 adversely affect in any other manner the status of an=20 employee. Tex. Lab. Code =
Ann. =A7 21.051=20
(West 2006). Section 21.051 "is substantively identical to its =
federal=20
equivalent in Title VII," but adds age and disability to the =
protected=20
categories. Quantum Chem. Co. v. Toennies, 47 S.W.3d 473, =
475=20
(Tex. 2001); cf. 42 U.S.C.A. =A7 2000e-2 (West 2003).=20
8. When enacting the statutory predecessor =
to chapter=20
21 of the labor code, the 1983 Texas Commission on Human Rights =
Act=20
(TCHRA), the legislature included the following =
provision: Notwithstanding = any other=20 provision of this article, it is not an unlawful employment = practice . . .=20 . (7) for an = employer to=20 engage in any practice that has a discriminatory effect and that = would=20 otherwise be prohibited by this Act if the employer establishes = that the=20 practice is not intentionally devised or operated to contravene = the=20 prohibitions of this Act and is justified by business=20 necessity. Commission on =
Human Rights=20
Act, 68th Leg., 1st C.S., ch. 7, =A7 5.07(7), 1983 Tex. Gen. Laws =
37, 49=20
(current version at Tex. Lab. Code Ann. =A7 21.115 (West 2006)).=20
9. A similar "general purpose" concerning =
disability=20
discrimination was added in 1993: to "provide for the execution of =
the=20
policies embodied in Title I of the Americans With Disabilities =
Act of=20
1990 and its subsequent amendments (42 U.S.C. Section 12101 et. =
seq)."=20
Tex. Lab. Code Ann. =A7 21.001(3) (West 2006).=20
10. To that end, the legislature went as =
far as to=20
provide: If a provision of = this=20 chapter is held by the Equal Employment Opportunity Commission to=20 disqualify the commission as a deferral agency or for the receipt = of=20 federal funds, the commission shall administer this chapter to = qualify for=20 deferral status or the receipt of those funds until the = legislature meets=20 in its next session and has an opportunity to amend this=20 chapter. Tex. Lab. Code =
Ann.=20
=A7 21.006 (West 2006); see also Fiscal Note, Tex. H.B. =
14, 68th=20
Leg., 1st C.S. (1983) (explaining that "EEOC provides grant monies =
to=20
state and local governments with acceptable laws and regulations. =
. . .=20
During the first year of operation, the State commission would =
receive=20
$375 per charge resolution. If it meets the quality standards =
established=20
by the U.S. Equal Employment Opportunity Commission in its =
performance, it=20
would receive $412.50 per charge resolution beginning in its =
second year,=20
and increases are anticipated in succeeding years.").=20
11. We also note that the legislative =
record reflects=20
an understanding by bill proponents that "[w]ith the passage of =
the Civil=20
Rights Act of 1991 and the Americans With Disabilities Act, it is=20
necessary to amend the Commission on Human Rights Act to be =
equivalent to=20
these two federal laws in order to maintain the current =
relationship=20
between the Commission on Human Rights and the U.S. Equal =
Employment=20
Opportunity Commission." House Comm. On State Affairs, Bill =
Analysis, Tex.=20
H.B. 860, 73d Leg. R.S. (1993).=20
12. E.g., how Dearing's statistical proof =
of=20
disparate impact will be proved and evaluated--specifically, =
against what=20
other group Dearing's claims will be measured to test for =
disparate=20
impact. Dearing observes =
that the=20
district court did not enter findings of fact and conclusions of =
law and=20
that ordinarily we would presume that the district court made any =
fact=20
findings supported by the evidence that were necessary for any =
legal=20
theory that could support its order. However, "actual, not =
presumed,=20
conformance" with rule 42 is required. Bernal, 22 S.W.3d =
at 435.=20
13. As the Fifth Circuit explained this =
concept, in=20
the context of the ADEA: The federal courts = now=20 universally hold that an individual who has not filed an = administrative=20 charge can opt-in to a suit filed by any similarly situated = plaintiff=20 under certain conditions. This so-called "single filing rule" = generally=20 allows a plaintiff, who did not file an EEOC charge, to piggyback = on the=20 EEOC complaint filed by another person who is similarly situated. = . . .=20 The policy behind the single filing rule is that it would be = wasteful, if=20 not vain, for numerous employees, all with the same grievance, to = have to=20 process many identical complaints with the EEOC. As long as the = EEOC and=20 the company are aware of the nature and scope of the allegations, = the=20 purposes behind the filing requirement are satisfied and no = injustice or=20 contravention of congressional intent occurs by allowing=20 piggybacking. Mooney, =
54 F.3d at=20
1223.=20
14. We decline to revisit the Court's prior =
holding=20
regarding the timeliness of Milburn Dearing's administrative =
complaint,=20
however.=20
15. See Price v. Choctaw Glove =
&=20
Safety Co., 459 F.3d 595, 598-99 (5th Cir. 2006); =
Crawford v.=20
U.S. Steel Corp., 660 F.2d 663, 665 (5th Cir. 1981); =
Wheeler v.=20
American Home Products Corp., 582 F.2d 891, 897-98 (5th Cir.=20
1977); Oatis, 398 F.2d at 499.=20
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