Credentialism and Disparate Impact Discrimination – No Degree, No Problem!?

February 15, 2024 | By Brian Matthew Rhodes

The job search process was frustrating for my firstborn, Mateo.  He had his coder certificate and ten years’ experience as a security and IT specialist but when he applied for certain roles, even at his current employer, he would automatically get turned down in the application process just because he didn’t have a college degree.  Unfortunately, my son isn’t alone in his experience. More than 70 million workers in the United States, over half of the country’s workforce, do not have a bachelor’s degree but between 2008 and 2017, over 70 percent of new U.S. job postings required a college degree.  Many non-degreed workers – like my son- have acquired abundant skills and know-how through a wide variety of pathways, including the military, trade professions, certificate programs, apprenticeships, community college, as caregivers, and by learning on the job. However, credentialism, which can also be called the paper ceiling, analogous to the glass ceiling, creates barriers for these skilled workers to get meaningful jobs.   

The impact of credentialism hits communities of color and rural communities particularly hard. Sixty-one percent of Black workers, 55 percent of Hispanic workers, 66 percent of rural workers, and 62 percent of veterans are non-degreed skilled workers. Between 2000 and 2019, these non-degreed skilled workers lost access to 7.4 million jobs that would have traditionally provided them with pathways to economic mobility but now require a degree—jobs like registered nurses, managers, and administrative assistants that once provided a pathway to the middle class.  A non-degreed, skilled worker who started their career in 1989 would—on average—need to work for 30 years to catch up to the wage a college-educated worker earned on the first day of their career.  In short, our reliance on degree requirements as a proxy for job readiness has created a reality where a four-year education is valued more than a career’s worth of on-the-job experience.  This credential-based thinking also comes with legal risks. 

Making a college degree a standard requirement for available positions may implicate Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e et seq., or other anti-discrimination statutes if it creates an unlawful adverse impact.   Establishing an adverse impact claim requires a showing, typically with statistical evidence, that a facially neutral practice has caused a significant adverse impact on a protected group.

The Supreme Court first recognized the adverse impact theory of discrimination under Title VII in Griggs v. Duke Power Co., 401 U.S. 424, 431 (1971), a case brought by African-American employees who were barred from transferring positions based on the employer’s requirement of a high school education or passing an intelligence test. The Court found that, although the requirements were applied fairly to employees of all races, they served as a barrier to employment that was discriminatory in operation in light of the outsized effect on African-Americans.  

The Equal Employment Opportunity Commission (“EEOC”) noted in an Informal Discussion Letter (2010)   that if a claimant could show that the strict degree requirement “would result in a significantly disproportionate exclusion of protected racial minorities then an employer could be liable unless it could show that the requirement is job-related and consistent with business necessity.”  A selection rate for any race, sex, or ethnic group that is less than four-fifths ( 4/5) (or eighty percent) of the rate for the group with the highest rate will generally be regarded by the Federal enforcement agencies as evidence of adverse impact, while a greater than four-fifths rate will generally not be regarded by Federal enforcement agencies as evidence of adverse impact.

As mentioned, employers may “rebut” a disparate impact discrimination claim by proving that their policy or practice has a “legitimate business justification”.  To establish a valid business justification, a company must show that the policy or practice furthers the legitimate employment goals of the employer in a significant way.  For example, Duke Power could have rebutted the showing of disparate impact by offering evidence that a high school diploma or an aptitude test was truly necessary for employees to perform the elevated work at issue. 

Once an employer articulates a business necessity/justification, the plaintiff can still prevail by showing other policies or practices would be at least as effective at meeting the stated business interests as the chosen practice, but would also have less of an impact on the protected group. Such a showing satisfies the plaintiff’s ultimate burden of proof—and leads to liability for the employer under a disparate impact theory.

Despite the availability of different defenses, job requirements without a clear relation to the skills required for the position could create the legal risk of a disparate impact claim, as those requirements may tend to screen out otherwise well-qualified minorities or other protected classifications. 

Mateo received a promotion to IT Tech manager even though he still has not achieved his college degree.  His employer looked past the lack of having that one piece of paper, ignored the cry to give in to credentialism, and saw he had the requisite skills, desire, and know-how to do the job.  Companies should carefully consider whether a college degree is a required qualification for an available position or, instead, if there is an equivalent or superior alternative approach. If a degree is preferred, but not required, the presence of a degree should not be given undue weight if other experience or skills have a stronger correlation to job success.

CLAIMER: A version of this post was first published in the ABA’s Human Rights magazine, Vol 49, No. 1/2: Labor & Employment Rights edition in October 2023.  Link –  

The information contained in this publication should not be construed as legal advice, is not a substitute for legal counsel, and should not be relied on as such. For legal advice or answers to specific questions, please contact one of our attorneys.

About the Authors

Brian Matthew Rhodes

Senior Counsel

Brian is an attorney in Obermayer’s Labor and Employment department. He provides advice and strategic counsel to a diverse array of industries, including nonprofit organizations, municipalities, state governments, health care, financial services,...

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