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. e du/thir dc ir c uit_1998/8Filed January 13, 1998

UNITED STATES COURT OF APPEALS

FOR THE THIRD CIRCUIT

No. 96-5848

NEWARK BRANCH, NATIONAL ASSOCIATION FOR THE ADVANCEMENT OF COLORED PEOPLE; JERSEY CITY BRANCH, NATIONAL ASSOCIATION FOR THE ADVANCEMENT OF COLORED PEOPLE; NEW JERSEY STATE CONFERENCE, NATIONAL ASSOCIATION FOR THE ADVANCEMENT OF COLORED PEOPLE; THE

NATIONAL ASSOCIATION FOR THE ADVANCEMENT OF COLORED PEOPLE, Appellants

v.

CITY OF BAYONNE, NEW JERSEY

On Appeal from the United States District Court for the District of New Jersey (D.C. Civil Action No. 90-cv-00684)

Argued July 22, 1997

Before: SCIRICA, ROTH and WEIS, Circuit Judges

(Filed January 13, 1998)JOSHUA N. ROSE, ESQUIRE

(ARGUED)
DAVID L. ROSE, ESQUIRE
Rose & Rose, P.C. 1835 K Street, N.W., Suite 900 Washington, D.C. 20006-1203

JONATHAN M. HYMAN, ESQUIRE Rutgers University School of Law Constitutional Litigation Clinic 15 Washington Street, Room 338 Newark, New Jersey 07102

Attorneys for Appellants

TARQUIN J. BROMLEY, ESQUIRE (ARGUED) Apruzzese, McDermott, Mastro & Murphy 25 Independence Boulevard

P.O. Box 112 Liberty Corner, New Jersey 07938

Attorney for Appellee

OPINION OF THE COURT

SCIRICA, Circuit Judge.

This Title VII case involves an interpretation of a consent order that removed a residency requirement for muni cipal employees.

In 1989, the National Association for the Advanceme nt of Colored People, its New Jersey State Conference, an d its Newark and Jersey City Branches, filed suit in dist rict court against the City of Bayonne, New Jersey. The NAACP alleged, inter alia, that Bayonne unlawfully discri minated in hiring municipal employees, principally police offi cers and firefighters, in violation of Title VII of the Civi l Rights Act of 1964, 42 U.S.C. SS 2000e-2000e-17 (West 1994 & Supp

. 1997) by requiring its employees to reside in Bayon ne.

Bayonne is a "civil service" municipality 1 and hir es

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1. Pursuant to N.J. Stat. Ann. SS 11A:9-1 and 11A:9 -2, a New Jersey municipality can choose whether or not it wants to be subject to the

2employees for competitive positions (police andfire fighters)

on the basis of their performance on a state-wide c ivil service examination administered by the New Jersey Department of Personnel.2 Applicants for non-compet itive positions are not hired on the basis of their perfo rmance on an examination.

On January 31, 1991, the parties entered into a stipulation and order settling the lawsuit. Bayonne agreed to suspend its residency requirement and to affirma tively recruit African American applicants. The stipulatio n expired in four years, but Bayonne remained under a continu ing obligation to ensure that its recruitment and hirin g practices were lawful and nondiscriminatory.

Four years later, in May 1995, because the removal of the residency requirement failed to increase--and i n the case of police officers decreased--the representati on of African Americans among its workforce, Bayonne rein stated the residency requirement. The NAACP sought injunct ive relief. In a bench trial, the district judge denied the request for injunctive relief, finding the NAACP failed to establish a causal nexus between the residency requirement and its allegedly disparate impact on African Americans. Th e NAACP now appeals.3

We hold the district court was not clearly erroneou s in concluding the NAACP failed to prove the residency requirement unlawfully discriminated against Africa n American applicants for police and firefighter posi tions. But the district court made no finding with respect to Bayonne's hiring for non-competitive jobs, which do not requi re a civil service examination. We will affirm in part and rev erse in
part.

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state's Civil Service Act.

2. The NAACP has not made the New Jersey Department of Personnel a party to this lawsuit and is not challenging the le gality of the

examination.

3. The Honorable H. Lee Sarokin presided over this matter in 1991. After Judge Sarokin was appointed to this court, the matt er was assigned to the Honorable William H. Walls, United States Distr ict Judge for the District of New Jersey.

3I.

Bayonne4 hires its municipal employees in accordanc e with New Jersey's Civil Service Act, N.J. Stat. Ann . S 11A:1- 1 et seq. (West 1993 & Supp. 1996). New Jersey has two divisions of civil service jobs: competitive and no ncompetitive. N.J. Stat. Ann. S 11A:3-2 (West 1993). Civil service regulations require that candidates for com petitive positions, including police and fire-department job s, apply through the New Jersey Department of Personnel. For these jobs, the New Jersey Department of Personnel admini sters examinations and promulgates a list of eligible can didates

based on the results of the examination. N.J.A.C.S 4A:4-1.1 (1995); S 4A:4-4.2 (1995). The New Jersey Departmen t of Personnel ranks the candidates on the list, called a certification, in order of their test scores. N.J. Stat. Ann. S 11A:4-1 (West 1993); N.J.A.C. S 4A:4-3.2 (1997). When Bayonne wants to hire workers for competitive posit ions, it requests a list of a number of candidates sufficien t to satisfy its hiring needs. N.J.A.C. S 4A:4-4.1 (1996 ). The New Jersey Department of Personnel then selects an appr opriate

number of candidates from the master list in accord ance with the residence requirements of Bayonne and forw ards the certification to Bayonne. N.J.A.C. S 4A:4-3.2. After receiving the certification, the municipality-- for the first time in the process -- learns the names, addresses and rank of eligible candidates. At the same time, the New Jersey Department of Personnel notifies eligible ca ndidates they have been certified and instructs them to info rm Bayonne if they are interested in the job. N.J.A.C. S 4A:4- 4.2(b). If a candidate indicates his or her interes t, Bayonne commences its own screening process to ensure that the candidate meets the age, citizenship, health and ch aracter standards established by state law and is otherwise suited to serve.5 Otherwise, with limited exceptions not a pplicable

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4. Bayonne is located in the southern end of Hudson County, New Jersey, bordered on the north by Jersey City. Newar k lies ten miles away. African Americans make up 4.7% of Bayonne's p opulation. African Americans make up 14.4% of the population of Hudson County and 40.6% of neighboring Essex County.

5. Candidates for the police and fire departments m ust also submit to a drug test, a thorough background check, a physical examination, and an interview with the chief of the police or fire depa rtment.

4here, Bayonne must hire the candidates in the exact rank

order presented by the New Jersey Department of Personnel. N.J.A.C. S 4A:4-4.8 (1996).

Candidates for non-competitive entry level position s, such as laborer and clerk typist, are hired directl y by Bayonne. Most electrical and blue collar positions are promoted from the laborer and clerk typist level. C ertain non-promotional, non-uniform positions are classifi ed as open competitive and are filled from certified list s created by the New Jersey Department of Personnel. Many of these jobs traditionally have been filled on a provisiona l basis while the New Jersey Department of Personnel posts the vacancies and certifies a list of eligible candidat es based on examinations. Frequently, although not always, the provisional appointee is appointed on a permanent b asis.

See J.A. at 1.27.

Before 1991, Bayonne limited its municipal hiring t o Bayonne residents only, an option permitted by the Civil Service Act. See N.J. Stat. Ann. S 40A:9-1.3 (1993) (Municipalities may "require [that] . . . all offic ers and employees employed by the local unit . . . be bonaf ide residents therein.").

As we have noted, on February 20, 1990, the NAACPfi led

suit in the United States District Court for the Di strict of New Jersey against Bayonne, asserting its residency requirement unlawfully discriminated against Africa n Americans in violation of Title VII. Before trial, the parties settled the case by entering into the stipulation. The stipulation provided that Bayonne "shall not engage in any employment practice which unlawfully discriminates against individuals on the basis of their race in r ecruitment or hiring or in other terms and conditions of emplo yment." J.A. at 2.5. The stipulation articulated its purpos e: "to ensure that the recruitment and hiring practices of Bayonne are lawful and non-discriminatory, and to e nsure that no one is unlawfully disadvantaged by its recr uitment and hiring practices." Id.

Under the stipulation, Bayonne, without admittingwrongdoing, promised to: (1) replace its "Bayonneresidency" requirement with a "New Jersey-residency "

5requirement for police officers and fire-fighters;6 (2)

affirmatively recruit African American applicants; and (3) refrain from discriminatory employment practices in the future. Recruitment efforts included "paid radio an d newspaper advertising and outreach in Newark, East Orange, and Jersey City, with the goal of attractin g black applicants in numbers reflecting their availability in the job category being filled." J.A. at 2.5-2.16.

Bayonne remained under a continuing obligation to refrain from discriminatory recruiting and hiring p ractices. The stipulation provided that "[a]t the conclusion of four (4) years from the date this Stipulation is executed . .. the requirements of this Stipulation shall cease to bin d [Bayonne] . . . except that [Bayonne] . . . shall c ontinue to ensure that the recruitment and hiring practices of Bayonne are lawful and non-discriminatory." J.A. at 2.16. In the event of Bayonne's non-compliance, the NAACP could enforce the stipulation upon "a clear and con vincing showing that defendant's failures or omissions to m eet the terms of this stipulation were not minimal or isola ted but were substantial." J.A. at 2.14. During the four-ye ar term, the NAACP never availed itself of this provision.

On March 8, 1991, Bayonne amended its residency ordinance in accordance with the terms of the stipu lation. Bayonne also increased recruitment efforts aimed at African Americans. The record demonstrates that the Bayonne Police Department engaged in an extensive program t o recruit Bayonne residents for the civil service exa mination which included outreach to African Americans living in Bayonne. In addition, the Deputy Chief of the fire department led an intensive effort to recruit and t rain Bayonne residents, particularly African Americans, for firefighter jobs. J.A. at 1.11-1.12, 1.35.

It is uncontested, however, that after four years, minority representation did not increase. Significantly, as the NAACP stated both in the district court and in oral argum ent before this court, minority representation among po lice

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6. For other positions, the stipulation provided th at Bayonne merely had to relax its residency requirement. Non-residents w ho took municipal jobs had to move into Bayonne within six months of their employment.

6officers actually decreased. The record demonstrate s that

the number of African American candidates referred by the Department of Personnel to Bayonne for police posit ions decreased from 3.4% to 1% during the moratorium.7

On May 3, 1995, "having concluded that the stipulat ed settlement with appellants did not increase the num ber of the City's black employees," Bayonne reenacted its residency requirement.8 Brief of Appellee at 13. As noted, on May 9, 1996, the NAACP asked for temporary and permanent injunctive relief, claiming Bayonne's reinstatement of the residency requirement violated the stipulation's prohibition against future employment

discrimination.

The district court reopened the case and on July 8, 1996, denied the NAACP's application for a preliminary injunction. Subsequently, in November 1996, the dis trict court conducted a bench trial. The parties submitte d extensive stipulations of fact, and the NAACP prese nted witness testimony. Much of the NAACP's evidence was statistical, including the following:9

- Bayonne is approximately 4.7% African Amer ican. Hudson County is approximately 14.4% African American, and neighboring Essex County is approximately 40.6% African American.

- Of the employees hired during the four-yea r moratorium, 2.6% of the non-residents were A frican

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7. We cannot make a similar comparison for firefigh ters because the parties have not provided us with statistics on Bay onne's hiring before the residency requirement was lifted. The parties' joint appendix does tell us from 1992-1995, 97 persons were certified t o Bayonne as eligible for employment as firefighters. Bayonne rejected on e, 3 declined appointment, 10 failed to respond to the notice of certification, and 9

asked to be deferred for later consideration. Of th e 81 hired, 2 (2.5%)

were African American. J.A. at 1.22-1.23.

8. The residency requirement became effective May 2 4, 1995.

9. These statistics were compiled in various years. We specify the years only when relevant.

7American, and 5.5% of the Bayonne residents were

African American.10

- During the four-year moratorium, the perce ntage of newly-hired police officers who were African American decreased. In February 1990, 3.4% ( 5 of 145) of those listed as eligible for police employment were African American, and 20% (2 of 10) of those hired were African American. In comparison, in January 1992, 8.2% (77 of 933) of those list ed as eligible for police employment were African American, and 1.1% (4 of 362) of those certi fied for hiring were African American. After the mora torium expired, in September 1996, 6.6% of newly-hi red police officers were African American.

- In Bayonne, 14.3% of employees of large, p rivate- sector employers are African American. In Hu dson County, 17.2% of employees of large, private -sector employers are African American.11

- 11.1% of New Jersey's civilian labor force is African American. 21.2% of New Jersey's government employees are African American.

The NAACP also offered expert witness David Griffin , who analyzed statistics, compared the racial compositio n of Bayonne with both the surrounding counties and the entire State of New Jersey, and opined that the residency requirement was discriminatory.

After hearing the NAACP's evidence, the district co urt granted Bayonne's Motion for Judgment under Fed. R. Civ. P. 52(c).12 The court found the NAACP failed to pro ve a

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10. African American representation in Bayonne's mu nicipal workforce was 3.5% before the four-year moratorium. The NAACP contends during the four-year moratorium, 5% of the municipal emplo yees hired were

African American. J.A. at 1.13-1.14. But the NAACP does not use this statistic in its briefs in support of its prima fac ie case. And at trial,

the NAACP's expert stated that he "would be surprised i f that [difference] was statistically significant." J.A. at 1.207.

11. The parties obtained these numbers from reports of the Equal Employment Opportunity Commission on the racial com position of private employer establishments with over 100 emplo yees.

12. Fed. R. Civ. P. 52(c) provides, in relevant par t: "If during a trial without a jury a party has been fully heard on an i ssue and the court8causal nexus between Bayonne's residency requiremen t

and the low percentage of African American municipa l employees. The district judge ruled orally:

I am constrained to dismiss this case becaus e there is no factual basis for what we have had by way of opinions given by the plaintiff's expert, Da vid Griffin, an expert in labor market analysis.

As I discussed with [plaintiff's counsel] Mr . Rose and I incorporate by reference, we have an order entered January 31, 1991 by the then District Judge Sarokin approving and incorporating therein a stipul ation by the parties. Originally the Newark Branch of the NAACP, together with other branches of the organization had brought suit against the Ci ty of Bayonne alleging and claiming that under Tit le VII, that the members of the plaintiff and member s of the black race in general had been discriminated against in employment by the municipality of Bayonne.

The stipulation sought to resolve the differ ences by the parties and between the parties by providing that a residency requirement, which had been the ma in thrust of the complaint by the plaintiffs ag ainst the defendant, would be removed, and it was so d one in, I believe, March 1991.

Thereafter, for the life of the stipulation, which was four years from the date of execution by Jud ge Sarokin, there was no such residency require ment. During that period, the hope for an increase in black municipal government employment, it is agree d, did not improve.

It should be also noted that during this per iod there has been no history, through the plaintiffs anyway in their case, of there being any complaint by the plaintiffs of any failure of the defendant m unicipality to

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finds against the party on that issue, the court ma y enter judgment as a matter of law against that party with respect to a claim or defense that cannot under the controlling law be maintained or d efeated without a favorable finding on that issue...."

9abide by the terms of the stipulation, altho ugh there

was a mechanism for such overview and review with the Court having jurisdiction retained to it to entertain any criticisms of what was being done or not being done by Bayonne.

In any event, we have had for the last day a nd a half evidence produced by David Griffin primarily which consists, with all due respect, of statistic al possibilities relying upon data wherein he assumes that Hu dson County is the employment market by which comparisons shall be made as to whether blac ks are being disparately impacted by the residency ordinance that was recently reinstated by the municipa lity of Bayonne in the spring of this year, 1996.

With due respect to the doctor, his opinions , as he admits in one circumstance, are nothing more than his expression of common sense. They are specula tive. They involve speculative contingencies and p ossibilities without any evidential basis. I can't be mor e specific because he was not more specific.

He speaks about the failure of blacks to be hired, but there is no evidence as to why they were not hired. He speaks of the non-seeking of employment with Bayonne by blacks and being much lower than that in surrounding Hudson County towns, but we have no evidence as to why that is. And regardless o f how important and how vital the purpose of Title VII is, it, too, just like any other law is dependent up on factual evidence from which judges and lawyers and p arties can make meaningful decisions. That is the p roblem with this case, we have no factual evidence.

We have well intentioned statistical platitu des. For example, much is made of a 1996 police emplo yment examination, which has a small number of per sons of, as I said, the black race, as being qualifie d, but that list was not prepared nor administered, nor reviewed by the defendant in the municipality. It was prepared by the New Jersey State Department of Person nel, so to try to speak of visiting discrimination, whether intentionally or inadvertently or institutio nally, at the

10doorstep of the municipality is not warrante d factually,

and that is why I dismiss this case, because there is nothing to support it factually.

J.A. at 1.251-1.255. The NAACP now appeals.

II.

The district court had jurisdiction under 28 U.S.C. SS 1331 and 1343 (1993) because this case arises un der Title VII, and we have jurisdiction under 28 U.S.C. S 1291 (1993).

The district court found the NAACP failed to meet t he burden imposed by the stipulation of demonstrating noncompliance because it did not prove the residency requirement caused a disparate impact in hiring. Ca usation presents a question of fact. Kachmar v. Sungard Dat a Sys. Inc., 109 F.3d 173, 179 (3d Cir. 1997); Thomas v. C ity of Omaha, 63 F.3d 763, 765 (8th Cir. 1995) (reviewing Title VII causation determination as a finding of fact).

Federal Rule of Civil Procedure 52(a) dictates the appropriate standard of review. In a bench trial, t he court "shall find the facts and state separately its conc lusions of law thereon" and those "[f]indings of fact... shall not be set aside unless clearly erroneous." Id. The NAACP requ ests application of a plenary standard of review. But th e applicable authority holds that the district court' s findings of intentional discrimination or disparate impact s hall be reviewed under the clearly erroneous standard. See Anderson v. City of Bessemer City, 470 U.S. 564, 56 6 (1985) ("In Pullman Standard v. Swint, 456 U.S. 273 (1982), we held that a district court's finding of discrimi natory intent in an action brought under Title VII . . . i s a factual finding that may be overturned on appeal only if it is clearly erroneous."); Villanueva v. Carere, 85 F.3d 481, 48 5-86 (10th Cir. 1996) ("[W]e may reverse the trial court 's finding of no discriminatory intent only if it is clearly e rroneous . . . . [T]his standard of review [is] well establi shed."); Bernard v. Gulf Oil Corp., 890 F.2d 735, 739 (5th C ir. 1989) ("The standard of review for such a decision is whe ther, looking at the record as a whole, the district cour t was clearly erroneous in its determination that there w as no

11purposeful discrimination and that the action resul ting in

disparate impact was justified by legitimate busine ss reasons.") (citation omitted); Keyes v. Secretary o f the Navy, 853 F.2d 1016, 1019 (1st Cir. 1988) ("A district co urt's finding concerning intent in an employment discrimi nation action is a factual finding within the `clearly err oneous' rubric.") (citation omitted); Chambers v. Omaha Gir ls Club, Inc., 834 F.2d 697, 702 (8th Cir. 1987) (citation o mitted).

Of course, this case lies one step removed from a traditional Title VII analysis. The district court evaluated whether Bayonne fulfilled its obligations under the stipulation to refrain from employment practices th at violated Title VII. Focusing on Bayonne's performan ce under the stipulation, the district court assessed whether Bayonne complied and made factual findings. We revi ew factual findings for clear error.

Harrison v. Metro. Gov't of Nashville and Davidson County, 80 F.3d 1107 (6th Cir. 1996), cert. denied, 117 S. Ct. 169 (1996) supports this standard of review. In Harrison, a discharged public employee filed a cont empt citation against his former government employer, al leging it failed to comply with a stipulation resulting from race discrimination litigation. The United States Court of Appeals for the Sixth Circuit applied the following standard of review when examining the district court's findi ng of contempt:

In order to hold the defendants in civil con tempt, a district court must find that the plaintiff established by clear and convincing evidence that the defen dants violated the court's prior order. In fact, e achfinding of a violation of the order must be supported b y clear and convincing evidence. . . . We review the dis trict court's finding of civil contempt for an abuse of di scretion. A district court may abuse its discretion when it relies on clearly erroneous findings of fact.

Id. at 1112-13 (citations omitted).

Accordingly, we review for clear error.

Under this standard, a finding is `clearly e rroneous when the reviewing court on the entire evide nce is left

12with the definite and firm conviction that a mistake

has been committed.' This standard does not permit the reviewing court to conduct a de novo rev iew of the evidence, but it does allow the court to con sider whether there is enough evidence in the reco rd to support the factual findings of the district court. This review is more deferential with respect to determinations about the credibility of witn esses, and

when the district court's decision is based on testimony that is coherent and plausible, not internal ly inconsistent and not contradicted by externa l evidence, there can almost never be a finding of clear error.

United States v. Igbonwa, 120 F.3d 437, 440-41 (3d Cir. 1997) (citations omitted), petition for cert. filed (Oct. 23, 1997) (No. 97-6518).13

III.

We must "examine the language of the [stipulation] to determine the obligations and duties undertaken by the various parties." Vulcan Pioneers, Inc. v. New Jers ey Dep't of Civil Serv., 832 F.2d 811, 814 (3d Cir. 1987). T he language of the stipulation is clear: Bayonne "shal l continue to ensure that the recruitment and hiring practices of Bayonne are lawful and non-discriminat ory." The parties agree this clause requires Bayonne to c omply with Title VII, 42 U.S.C. S 2000e-2(a), which makes it unlawful to "limit . . . applicants for employment in any way which would deprive or tend to deprive any indi vidual of employment opportunities . . . because of such individual's race . . . ." Title VII prohibits not only intentional discrimination, but also "disparate imp act" discrimination, i.e., "employment practices, adopte d without a deliberately discriminatory motive, [which] may i n operation be functionally equivalent to intentional

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13. The NAACP maintains the district court failed t o make the requisite findings of fact. Under Robinson v. Lehman, 771 F.2 d 772 (3d Cir. 1985), the district court must set forth findings of fact sufficient to allow

"the appellate court, on review, [to] ascertain the basi s for [its] decision."

Id. at 780. Except with respect to Bayonne's hiring of non-competitive employees, the district court satisfied this requir ement.

13discrimination." Watson v. Fort Worth Bank & Trust, 487

U.S. 977, 987 (1988).

In order to establish a prima facie case of dispara te impact discrimination, the plaintiff must demonstra te that application of a facially neutral standard has caus ed a "significantly discriminatory hiring pattern." Newa rk Branch, NAACP v. Town of Harrison, 940 F.2d 792, 79 8 (3d Cir. 1991). See also Wards Cove Packing Co., Inc. v

. Antonio, 490 U.S. 642, 657 (1989) (holding plaintif fs must "demonstrate that the disparity they complain of is the result of one or more of the employment practices t hat they are attacking here, specifically showing that each challenged practice has a significantly disparate i mpact on employment opportunities for whites and nonwhites." ). The evidence in these cases usually focuses on statisti cal disparities. Harrison, 940 F.2d at 798. 14

To prove causation through statistical evidence alo ne, the statistics must be "of a kind and degree sufficient to show that the practice in question has caused the exclus ion of applicants for jobs or promotions because of their membership in a protected group. . . . [S]tatistica l disparities must be sufficiently substantial that t hey raise such an inference of causation." Watson, 487 U.S. a t 994- 95. See also McNeil v. McDonoush, 648 F.2d 178, 182 (3d Cir. 1981) (causation will be proven only if the st atistics do not require speculation by the court). The Supreme Court has emphasized that the statistics must be relevant to the discrimination alleged. See Hazelwood School Dist. v. United States, 433 U.S. 299, 313 n.20 (1977). "The`proper comparison [is] between the racial composition of [ the atissue jobs] and the racial composition of the quali fied . . . population in the relevant labor market.' " Wards C ove, 490 U.S. at 650-51 (citations omitted).

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14. Once the plaintiff proves its prima facie case , the burden shifts to

the defendant to prove a business justification for the challenged practice.

It is then up to the plaintiff to discredit any busine ss justification

asserted (or to suggest a viable alternative to the challeng ed practice which would reduce the disparate impact). Harrison, 940 F.2d at 798. Burden shifting never occurred in this case, because the court held plaintiff failed to prove its prima facie case.

14The district court found the statistical evidence o ffered by

the NAACP was insufficient to prove causation. 15 Specifically, it held the NAACP did not prove the r esidency requirement discriminated against African Americans . At oral argument the NAACP conceded the New Jersey civ il service examination was a likely cause of the dispa rity.16 As the Court of Appeals for the Fifth Circuit held in considering a challenge to an employment test:

The plaintiffs contend that th[e] disparity results both from testing and the use of subjective crite ria, yet they

offer no method from which this Court can as certain whether a significant part of this disparity results from testing. The plaintiffs simply have not show n that testing, independent of other factors that m ay affect the racial balance of the workforce, is caus ally related

to discrimination in the number of blacks hi red or promoted. The causal requirement recognizes that under representation of blacks might result from any number of factors, and it places an initial burden on the plaintiff to show that the specific fact or challenged under the disparate impact model results in the discriminatory impact. The plaintiffs, by fa iling to isolate the discriminatory effect of the pra ctice they challenged, did not meet this burden.

Carroll v. Sears, Roebuck & Co., 708 F.2d 183, 189- 90 (5th Cir. 1983).

The NAACP contends it has proven causation. Althoug h its position is not entirely clear, it seems to mak e two separate arguments. First, the NAACP argues the res idency requirement reduces the percentage of African Ameri cans on the list of eligible candidates. Responding to t he district court's request to produce its best evidence, couns el for the NAACP said: "If [Bayonne has] the residency require ment

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15. The NAACP contends the district court improperl y held statistics are an improper form of evidence. We disagree. The dist rict court held that the statistics in this case were insufficient, and expressed no opinion whether they constituted "proper" evidence.

16. Counsel for the NAACP acknowledged, "Clearly th e test has a disparate impact, no question about it." The NAACP argues that although the test is one cause, the residency requi rement is another.

15they hire from the 6 percent black list. If they do n't have

the residency requirement, they might hire from an 11 percent black list or 15 percent black list." 17 J. A. at 1.238. By referring to the "list," the NAACP apparently me ans the list of applicants who took and received a passing grade on the law enforcement examination administered by the New Jersey Department of Personnel in January 1996. 18

But this argument ignores the process by which Bayo nne selects police officers. That 15% or 30% of those t aking and passing the test are African American bears little relationship to the racial composition of the list of candidates ultimately certified to Bayonne. Except for the residency requirement, Bayonne does not have contro l over the list. The New Jersey Department of Personnel ce rtifies the list to Bayonne, ranking the applicants in orde r of their test scores. N.J. Stat. Ann. 11A:4-1; N.J.A.C. 4A:4 -3.2. With limited exceptions not applicable here, Bayonn e cannot choose from a "pool" of qualified candidates but

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17. In its brief, the NAACP argues that Bayonne wou ld have hired police officers in 1996 from a list of eligibles that was over 30% African American if it had no residence requirement.

18. As we have noted, statistics often form the bas is of the prima facie case in disparate impact cases. See Harrison, 940 F .2d at 798 (citations omitted). In Wards Cove, the Supreme Court emphasiz ed that "the `proper comparison [is] between the racial composit ion of the [at-issue] jobs and the racial composition of the qualified .. . population in the relevant labor market.' " 490 U.S. at 651 (citation s omitted). The Court noted the possibility of using other statistics. Se e Id. at 651 ("Alternatively, in cases where such labor market s tatistics will be difficult if not impossible to ascertain, we have r ecognized that certain other statistics--such as measures indicating the r acial composition of `otherwise qualified applicants' for at-issue jobs- -are equally probative for this purpose."). And this court has looked to o ther statistics in disparate impact cases, see Green v. USX Corp., 896 F.2d 801, 805, but not when more probative statistics were available. The NAACP cites no authority, and we can find none, that supports the use of these particular statistics to set out a prima facie case of disparate impact discrimination under Title VII, particularly where the NAACP had

available to it and made use of the labor market st atistics that form the proper basis of a disparate impact case under Wards Cove. We express no opinion on whether under the appropriate circums tances such statistics can form the proper basis of a prima fac ie case under Title

VII.

16must hire the candidates presented by the New Jerse y

Department of Personnel according to rank. N.J.A.C. 4A:4- 4.8. Bayonne cannot waive civil-service requirement s for any applicant for a job governed by the civil servi ce system. N.J.A.C. 4A:10-2.1. Significantly, when Bayonne rem oved the residency requirement, the number of African Am erican

candidates referred to it did not increase and even decreased. The NAACP acknowledges that African Amer ican representation on the certified list decreased. As noted, the

record demonstrates that the number of African Amer ican candidates referred by the Department of Personnel to Bayonne for police positions decreased from 3.4% to 1% during the moratorium.19

The NAACP's second argument involves a comparison between the racial composition of what it asserts t o be the labor market and the racial composition of Bayonne' s workforce. While defining the relevant labor market precisely is usually necessary, we can also look to the general population of the Bayonne area if it is an adequate proxy.20 See Wards Cove, 490 U.S. at 651 n.6 (citat ions omitted) ("[W]here `figures for the general populat ion might . . . accurately reflect the pool of qualified job applicants,' we have even permitted plaintiffs to rest their pri ma facie cases on such statistics. . . .").21 We found stat istics on the general population sufficient to prove causation in Harrison,

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19. As we have noted, the parties have not provided us with similar comparative statistics for firefighters. According to the parties' joint appendix, however, from 1992-1995, of the 81 firefi ghters hired, 2 (2.5%)

were African American. J.A. at 1.22-1.23.

20. The district court characterized the NAACP's de finition of Bayonne's labor market as "speculative." As our analysis will show, we do not need to decide whether the NAACP properly defined the la bor market.

21. We assume arguendo that the general population of the greater Bayonne area is the relevant labor market. But we n ote that looking to the general population is not necessarily sufficien t in situations like

this one where the claim involves jobs with "special qua lifications". See Hazelwood School Dist. v. United States, 433 U.S. 2 99, 307-308 (1977) ("When special qualifications are required tofill p articular jobs, comparisons to the general population (rather than to the smaller group of individuals who possess the necessary qualificat ions) may have little probative value.").

17940 F.2d at 792, where the NAACP sued the Town of

Harrison claiming its residency requirement exclude d African Americans from municipal employment. The To wn of Harrison is similar to Bayonne -- it contains a low percentage of African American residents, and it si ts in Hudson County. Following a bench trial, we upheld judgment for the NAACP, citing with approval the di strict court's reasoning:

[t]he geographical areas from which Harrison draws employees includes its own County of Hudson as well as Bergen, Essex and Union counties. . . . I t would be hard to conclude that among the very substan tial number of black workers in the four county l abor market there are not large numbers of person s qualified to serve as police officers, firef ighters, clerk typists and laborers . . . . [W]here Harriso n across the board has no black employees and where the t otal work force in [the four-county area] has at least 214,747 black persons, disparity is at least suggested.

Id. at 799.22

But there are important differences between Harriso n and this case. First, the statistical evidence in Harri son was extremely probative. Before suit commenced, no Afri canAmerican person had ever held a uniformed or nonuniformed municipal position even though African American representation among Harrison's private employers was 22.1%. Harrison, 940 F.2d at 796.

Furthermore, the only evidence presented in Harriso n were projections based on statistics; here there is direct evidence consisting of hiring percentages of Africa n American applicants during the four years in which Bayonne removed its residency requirement. Statisti cs "are not irrefutable; they come in infinite variety and, like any

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22. In Harrison, the court apparently did not consi der the impact of the civil service examination because the parties did n ot raise it. On appeal, Harrison argued: (1) that the relevant labor market should be defined as the entire State of New Jersey; and (2) that it had legitimate business justifications sufficient to satisfy its burden und er Title VII. Harrison

did not dispute the accuracy of the plaintiffs' statist ical analysis. See Harrison, 940 F.2d at 799-800.

18other kind of evidence, they may be rebutted. In sh ort, their

usefulness depends on all of the surrounding facts and

circumstances." International Bhd. of Teamsters v. United States, 431 U.S. 324, 340 (1977). In Title VII case s, we often rely on statistical evidence because direct e vidence of the effect of a particular employment practice is n ot available. In Harrison, we concluded that the data presented indicated that among "the `vast black lab or force in Harrison's labor market, there would be a large number of black persons qualified to serve and wishing to serve' in each category of municipal employment in Harrison." 940 F.2d at 889. In this case, no projection is necessa ry because there is direct evidence of the impact of t he challenged employment practice. Under the 1991 stipulation, Bayonne removed the residency requirem ent for four years, and minority representation did not inc rease and even decreased for police officers. Faced with that record, we believe that the district court did not commit clear error in finding that the NAACP had failed to prove causation.

The NAACP contends we should not consider the resul ts of the four-year moratorium and the evidence that t he "bottom line" racial statistics did not improve, ci ting Connecticut v. Teal, 457 U.S. 440 (1982). But Teal did not hold that the "bottom line" is irrelevant; it held that an employer cannot avoid Title VII liability by manipu lating the "bottom line" to compensate for racial discriminati on in hiring or promotions. In Teal, employees of the Dep artment

of Income Maintenance of the State of Connecticut s ued their employer, alleging that a promotion-eligibili ty examination was racially biased. The employer, in o rder to compensate for the low percentage of minority emplo yees who passed the examination, selected a disproportio nately high number of those minorities for promotion. The Court held the high minority promotion rate did not negat e the discriminatory impact of the examination. "The sugg estion that disparate impact should be measured only at th e bottom line ignores the fact that Title VII guarant ees these individual respondents the opportunity to compete e qually with white workers on the basis of job-related crit eria." Id.

at 451.

19Teal suggests that a subsequent affirmative action

program cannot "redeem" discriminatory conduct that produces disparate results. See Id. at 452 ("respon dents' claim of disparate impact from the examination, a p ass-fail barrier to employment opportunity, states a prima f acie case of employment discrimination under S 703(a)(2) despite their employer's nondiscriminatory `bottom line,' a nd that `bottom line' is no defense to this prima facie cas e under S 703(h)"). Here, the district court found no evide nce of either disparate impact or racial discrimination. Furthermore, the NAACP presented no evidence that Bayonne manipulated the "bottom line" results of th e fouryear moratorium.

The NAACP's reading of Teal -- that we must ignore the

bottom line -- is also inconsistent with Hazelwood and its progeny. Those cases appear to point to the "bottom line" to establish a prima facie case. Specifically, they st ate the "proper comparison [is] between the racial composit ion of [the at-issue jobs] and the racial composition of t he qualified persons in the labor market." Wards Cove, 490 U.S. at 650 (citations omitted).

The plaintiff must, of course, do more than point t o the "bottom line" to establish a prima facie case. The Supreme Court has held that a plaintiff must also prove cau sation. This was made clear when, seven years after Teal, t he Supreme Court held:

a Title VII plaintiff does not make out a ca se of disparate impact simply by showing that, `at the bottom line,' there is racial imbalance in t he work force. As a general matter, a plaintiff must demonstrate that it is the application of a specific or particular employment practice that has created the dis parate impact under attack. Such a showing is an in tegral part of the plaintiff 's prima facie case in a disparate- impact suit under Title VII.

Wards Cove, 490 U.S. at 657. The district court her e concluded the NAACP's statistical evidence failed t o prove how reinstituting the residency requirement would c ause a decrease in minority representation.

20In finding that the NAACP failed to show causation, the

district court speculated that the civil service ex amination may be the cause of Bayonne's low hiring rate of Af rican

Americans. The court noted: "much is made of a 1996 police employment examination, which has a small nu mber of persons of . . . the black race, as being qualif ied, but that list was not prepared or administered, nor reviewed by the defendant." The NAACP itself acknowledged to the di strict court: "When the residency requirement was lifted, [black applicants] were knocked out by the [police] exam. We

believe this also occurred in the fire exam. . . . The test is administered by the Department of Personnel. We are not asking the Court to do anything about the test." J. A. at

1.66.

The district court found the NAACP failed to furnis h evidence of a causal relationship between the resid ency requirement and the disparity in hiring. As we have discussed, the evidence presented -- that the perce ntage of African American municipal employees did not increa se during the four-year moratorium and even decreased for police officers -- indicates that the district cour t did not

commit clear error when it found insufficient evide nce of causation. See Vulcan, 832 F.2d at 816 (finding dis trict

court did not commit clear error when it found stat istical evidence flawed and unconvincing).

IV.

As we have noted, Bayonne hires employees for both competitive and non-competitive jobs. The district court focused its analysis almost entirely on hiring for competitive jobs. In granting Bayonne's Rule 52 mot ion, the court pointed to the civil service examination as t he probable cause of the alleged disparity and noted t hat the examination is administered by the New Jersey Depar tment of Personnel, not Bayonne.23

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23. The court noted the test "was prepared by the N ew Jersey Department of Personnel, so to try to speak of visi ting discrimination, whether intentionally or inadvertently or instituti onally, at the doorstep of the municipality is not warranted factually, and that is why I dismiss this case, because there is nothing to support it f actually."

21But Bayonne hires candidates for the non-competitiv e

jobs, like laborer and clerk typist, directly and a ppears to have complete control over the process. Candidates for these jobs do not have to take and pass the New Jer sey civil service examination. Furthermore, the residen cy requirement for these positions was merely relaxed so that non-residents who were hired had to move into Bayon ne within six months of their hiring. The district cou rt made no separate finding as to what impact, if any, this had on Bayonne's hiring of African Americans and what impa ct the reinstitution of that requirement has had on opport unitiesfor African Americans to work for Bayonne in noncompetitive jobs.

Under Rule 52(a), the district court shall makefind ings of fact. Although there is some evidence on the rec ord whether Bayonne discriminates in hiring non-competi tive employees, the district court made no findings. On this record, we are unable to determine whether the NAAC P has established a prima facie case of discrimination un der Title VII in the City's hiring of non-competitive employe es. We

will remand this matter to the district court.

V.

For the foregoing reasons, we will affirm in part, reverse in part, and remand for proceedings consistent with this opinion.

A True Copy:

Teste:

Clerk of the United States Court of Appeals

for the Third Circuit

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