The opinion of the court was delivered by: JOSEPH E. IRENAS
In March of 1992 Bally's Park Place, Inc. ("Bally's") discharged sixteen floorpeople, including the plaintiffs, as part of a larger reduction in force. The plaintiffs, Martin Maidenbaum and Joseph A. Fiore, both of whom were then age fifty-three, claim age discrimination under both the Age Discrimination in Employment Act ("ADEA"), 29 U.S.C. § 621 et. seq., and the New Jersey Law Against Discrimination ("LAD"), N.J.S.A. § 10:5-1 et. seq. (Supp. 1994).
The complaint also alleges wrongful discharge in breach of an implied contract of employment under New Jersey law. The Court has subject matter jurisdiction pursuant to 28 U.S.C. §§ 1331 and 1343. Plaintiffs' state law breach of contract action is cognizable under the Court's supplemental jurisdiction. 28 U.S.C. § 1367 (a).
Casino games are organized in areas known as pits. Pit employees include pit bosses, floorpeople, dual-rate dealers and dealers. Pit bosses oversee several floorpeople. Floorpeople supervise several tables at which the same game is being played. Dual-rate dealers may either deal or serve as floorpeople.
All casino employees are required to be licensed by the Casino Control Commission ("CCC"). N.J.S.A. 5:12-90(a); N.J.A.C. 19:41-1.3. An employee's license must also be endorsed by the CCC to show the particular positions which the employee is qualified to hold. N.J.S.A. 5:12-90(d); N.J.A.C. 19:41-1.3(a), (b). Although the CCC had always established and applied specific qualifications for a license endorsement authorizing employment in different positions such as dealer, boxperson, croupier, floorperson, etc., these qualifications were not made part of the New Jersey Administrative Code until September 6, 1994. N.J.A.C. 19:41-1.6 et seq. The requirements for a floorperson endorsement are now set forth in N.J.A.C. 19:41-1.9(c). An already licensed floorperson who desires to supervise more than one game must meet additional requirements.
Joseph Fiore was forty years old when he was hired by Bally's as a craps dealer on December 17, 1979. On June 30, 1980, Bally's hired forty-one year old Martin Maidenbaum for the same position. Both were promoted to floorperson in the year following their respective dates of hire, and both were among sixteen floorpeople, ten of whom were over forty, terminated by Bally's on March 10, 1992. Neither plaintiff was ever licensed to supervise a game other than craps.
Sometime prior to March of 1992, Bally's decided to reduce its management staff by about forty employees.
In determining which floorpeople to terminate, Bally's excluded those who were already qualified to supervise two games or who had a minimum of twenty-five
hours experience in dealing a second game. Bally's then laid off sixteen
of the remaining employees with the least seniority. Neither plaintiff had acquired any hours dealing a second game.
Until four days prior to the layoffs Bally's had a written termination policy based solely on seniority. However, in a November, 1990, meeting Vice President of Casino Operations, James Carr, stated that seniority would not be the only factor considered in any future layoff and that such determinations would be based on whether floorpeople were qualified to supervise a second game. Richard Knight, Vice President of Casino Operations, advised game supervisors in January, 1992, that it would be "strongly recommended" for floorpeople to "get a second game." (Knight Dep. at 91.)
III. SUMMARY JUDGMENT STANDARD
Defendant moved for summary judgment on October 7, 1994. Under Fed. R. Civ. P. Rule 56(c), a court may grant summary judgment "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." The nonmoving party may not simply rest on its pleadings to oppose a summary judgment motion but must affirmatively come forward with admissible evidence establishing a genuine issue of fact. See Celotex Corp. v. Catrett, 477 U.S. 317, 324, 91 L. Ed. 2d 265, 106 S. Ct. 2548 (1986).
In deciding a motion for summary judgment, the Court must construe the facts and inferences in a light most favorable to the nonmoving party. Pollock v. American Telephone & Telegraph Long Lines, 794 F.2d 860, 864 (3d Cir. 1986). The role of the court is not "to weigh the evidence and determine the truth of the matter, but to determine whether there is a genuine issue for trial." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249, 91 L. Ed. 2d 202, 106 S. Ct. 2505 (1986).
The substantive law governing the dispute will determine which facts are material, and only disputes over those facts "that might affect the outcome of the suit under the governing law will properly preclude the entry of summary judgment." Anderson, 477 U.S. at 248. A genuine issue for trial does not exist "unless the party opposing the motion can adduce evidence which, when considered in light of that party's burden of proof at trial, could be the basis for a jury finding in that party's favor." J.E. Mamiye & Sons, Inc. v. Fidelity Bank, 813 F.2d 610, 618 (3d Cir. 1987) (Becker, J., concurring).
IV. AGE DISCRIMINATION CLAIMS
The ADEA makes it unlawful for an employer "to discharge any individual or otherwise discriminate against any individual with respect to his compensation, terms, conditions, or privileges of employment, because of such individual's age." 29 U.S.C. § 623(a)(1). Similar provisions are contained in the New Jersey LAD. N.J.S.A. 10:5-12(a). Age discrimination claims under the LAD are governed by the same standards and burden of proof structures applicable under the ADEA. E.g., McKenna v. Pacific Rail Service, 32 F.3d 820 (3d Cir. 1994); Giammario v. Trenton Bd. of Educ., 203 N.J. Super. 356, 497 A.2d 199 (App. Div.), certif. denied, 102 N.J. 336, 508 A.2d 212 (1985), cert. denied, 475 U.S. 1141, 106 S. Ct. 1791, 90 L. Ed. 2d 337 (1986).
Plaintiffs' age discrimination claims are based on the theories of disparate impact and disparate treatment. In attempting to prove disparate treatment plaintiffs argue, alternatively, that the case is one based on mixed motives, direct evidence, or pretext.
In Griggs v. Duke Power Co., the Supreme Court held that a showing of disparate impact, as opposed to discriminatory motive, was sufficient to establish unlawful discrimination in cases involving charges of racial discrimination. 401 U.S. 424, 91 S. Ct. 849, 28 L. Ed. 2d 158 (1971). However, neither the Supreme Court nor the Third Circuit has directly held that the disparate impact theory applies to age discrimination suits.
While a concurring opinion of the Supreme Court in Hazen Paper Co. v. Biggins, 123 L. Ed. 2d 338, 113 S. Ct. 1701, 1710 (1993),
has cast doubt on the applicability of disparate impact analysis to ADEA claims, circuit courts of appeal, district courts in the Third Circuit and the New Jersey Appellate Division have held that such analysis is appropriate in age discrimination cases. See Cherchi v. Mobil Oil Corp., 693 F. Supp. 156, 165 (D.N.J. 1988), aff'd without op., 865 F.2d 249 (3d Cir. 1988) (citing circuit court and district court cases applying disparate impact analysis to age discrimination cases) ; Giammario, supra (New Jersey Appellate Division affirmed trial court's decision to apply impact analysis to age discrimination case). Therefore, we shall examine plaintiffs' disparate impact claims.
"To establish a prima facie case under the disparate impact model, plaintiff[s] must show 'that the facially neutral employment practice had a significantly discriminatory impact.'" Massarsky v. General Motors Corp., 706 F.2d 111, 120 (3d Cir. 1983) (quoting Connecticut v. Teal, 457 U.S. 440, 446, 73 L. Ed. 2d 130, 102 S. Ct. 2525 (1982)), cert. denied, 464 U.S. 937, 104 S. Ct. 348, 78 L. Ed. 2d 314 (1983); see also 42 U.S.C. § 2000e-2 (k)(1)(A)(i) (Civil Rights Act of 1991). Once this showing is made, the employer may defend by demonstrating that the employment practice is required by business necessity. 42 U.S.C. § 2000e-2(k)(1)(A)(i); Massarsky, 706 F.2d at 120; Newark Branch, N.A.A.C.P. v. Town of Harrison, New Jersey, 940 F.2d 792, 798 (3d Cir. 1991).
Under the Civil Rights Act of 1991 the burden of persuading the trier of fact that employment practices are justified by business necessity falls on the employer. 42 U.S.C. § 2000e-2(k)(1)(A)(i); Frazier v. Garrison I.S.D., 980 F.2d 1514, 1525 n.34 (5th Cir. 1993). However, the employer's burden does not arise unless the plaintiff is able to establish her prima facie case. 42 U.S.C. § 2000e-2(k)(1)(B)(ii); Massarsky, 706 F.2d at 120.
To establish a prima facie case, plaintiffs must show that the questioned employment practice had a disparate impact on the protected class of employees age forty or older. Massarsky, 706 F.2d at 120. Plaintiffs claim that defendant's termination criteria -- selecting one-game supervisors without twenty-five hours towards a second game -- had the requisite discriminatory impact. To prove discriminatory impact, plaintiffs frequently use "statistics from which it may be inferred that the employer's employment practice significantly disadvantaged employees [in the protected class]." Cherchi, 693 F. Supp. at 166. Plaintiffs' statistics show that if Bally's had followed its former layoff policy based solely on seniority, only 25% of those terminated (four out of sixteen employees) would have been in the protected class, rather than 63% (ten out of sixteen employees).
The Court finds this evidence unconvincing. First, the sample size of sixteen terminated employees is insufficient to find disparate impact. Courts have consistently found similar sample sizes as too small to be meaningful. See, e.g., Teamsters v. United States, 431 U.S. 324, 339 n.20, 52 L. Ed. 2d 396, 97 S. Ct. 1843 (1977) ("Considerations of such a small sample size may, of course, detract from the value of [statistical] evidence"); Mayor of Philadelphia v. Educational Equality League, 415 U.S. 605, 621, 39 L. Ed. 2d 630, 94 S. Ct. 1323 (1974) (approving of district court's concern for smallness of sample size of thirteen); Simpson v. Midland-Ross Corp., 823 F.2d 937, 943 n.7 (6th Cir. 1987) ("small statistical samples provide little or no probative force to show discrimination"); Krystof v. Hyatt Corp., 827 F. Supp. 490, 493 (N.D.Ill. 1993) (citing numerous cases rejecting statistical conclusions based on small samples). The Third Circuit has held that "an adverse impact on a single employee, or even a few employees, is not sufficient to establish disparate impact." Massarsky, 706 F.2d at 121.
The reduction in force barely affected the age distribution among the remaining floorpeople. Employees in the thirty-five to thirty-nine age group increased by 2%, while those in the fifty to fifty-four age group decreased by 1%. In all other age groups the percentage of the total number of floorpeople remained the same before and after layoffs. Bally's retained ...