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  "name": "NORTH CAROLINA DEPARTMENT OF CORRECTION v. EDWARD EARL HODGE",
  "name_abbreviation": "North Carolina Department of Correction v. Hodge",
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    "judges": [
      "Judges Johnson and Parker concur."
    ],
    "parties": [
      "NORTH CAROLINA DEPARTMENT OF CORRECTION v. EDWARD EARL HODGE"
    ],
    "opinions": [
      {
        "text": "GREENE, Judge.\nThe State appeals the superior court\u2019s order affirming the award of the State Personnel Commission (\u201cCommission\u201d) in favor of employee Edward Earl Hodge (\u201cHodge\u201d) for racial discrimination in a Central Prison correctional officer employment promotion decision.\nThe record shows that the North Carolina Department of Correction, Division of Prisons, employed Hodge, who is black, as a lieutenant correctional officer at Central Prison. In March, 1987, a black correctional officer transferred from his captain\u2019s position, leaving a vacancy, for which Hodge applied. At the time Hodge applied for the position, he had been a Central Prison correctional officer for eighteen years, occupying the rank of lieutenant for eleven of the years. Six other lieutenants also applied for the promotion, of whom two were black. A three-member prison employment commission, appointed by the prison warden, interviewed Hodge for the position, but recommended that the warden promote another correctional lieutenant, who is white. The three commission members included the deputy warden, personnel director and chief of prison operations, all of whom are white. The record shows that each of the three interviewers rated the candidates in five categories: interview behavior, job knowledge, policy and procedures, leadership ability, and judgment. The interview evaluation provided each candidate with fifteen individual scores of up to five points each, for a possible total of 75 points. The interviewers scored the promoted employee with a cumulative total of 71 points and Hodge with a cumulative total of 60 points. Based on the commission\u2019s recommendation derived from the interview scores, the Central Prison warden promoted the white lieutenant to the position. Hodge filed a grievance, alleging racial discrimination and requesting review of the promotion by a Commission Administrative Law Judge (ALJ).\nAt the ALJ hearing, Hodge offered evidence showing that he had been tested for promotion to captain, achieving a score of 96 of 100 points, the highest applicant score on the correctional captain permanent-employment eligibility list. Hodge also introduced evidence that he had more experience as acting temporary shift commander than any other applicant, and that his employment performance appraisal for the two years preceding his application included excellent ratings and high recommendations. Hodge had taught prison policy, procedure and operations to other correctional officers for approximately 10 years. Upon the former correctional captain\u2019s departure, the outgoing captain appointed Hodge temporary acting captain during the interim period preceding selection of the permanent appointee. He also offered evidence showing that of the six current Central Prison captains, only one was a member of a racial minority. At the hearing, Hodge questioned and the personnel director on the interview board testified as follows:\nQ. As far as seniority goes and rank as a. lieutenant, is there any preference that is given to people that have seniority and rank?\nA. It is explained to the candidate before the interview that we take all of these things into consideration, but no one item will carry more weight than the other.\nA. We [Central Prison staff] have made a good attempt to promote those people [minorities]. We often are criticized. I have personally been criticized by the majority in that the next person promoted is going to be black.\n[ALJ] Q. But that would influence you to make sure that it was white, then, right, if they criticized you to that extent?\nA. I think they were criticizing me to the fact that they say we promote minorities.\nQ. You stated that you had been criticized by the majority \u2014 and I would assume that whites are the majority \u2014 to the fact that the next promotion would probably be a black one?\nA. That is true.\nQ. If there were to be a promotion tomorrow to captain, would the number two person automatically get it, or would there be a whole new interview?\nA. For correctional captain, we would probably hold another interview.\nQ. So, in essence, if you came in second, you have profited none?\nA. You have to put them in priority order.\nAt the hearing, the prison warden who promoted the white lieutenant testified that he would have promoted a black if the promotee could not serve.\nThe State put on no evidence, contending that \u201calthough he [Hodge] is an eminently qualified correctional lieutenant, [he] was not as qualified for the position of correctional captain as the person who was selected for the position.\u201d The ALJ determined in favor of Hodge that the State\u2019s decision was racially discriminatory. The State appealed the ALJ\u2019s recommendations and opinion to the full Commission, pursuant to N.C.G.S. \u00a7 150B-36(a).\nThe Commission made the following Conclusions:\n1. Mr. Edward Earl Hodge ... is a permanent State employee who has worked at Central Prison since 1969 and served as Lieutenant for more than twelve years. Because [Hodge] has alleged racial discrimination as the reason he was not promoted to Captain, the Office of Administrative Hearings has jurisdiction to hear the matter and submit a recommendation to the State Personnel Commission which shall make a final decision in the matter. North Carolina General Statutes 126-16, 126-36, 126-37 and 150B-23.\n2. Whe[n] discrimination is an issue, [Hodge] bears the ultimate burden of proof and must establish a prima facie case of discrimination by providing sufficient facts in order to raise an inference of discrimination. In his effort to establish a prima facie case of discrimination, [Hodge] has shown the following: That he is a member of a protected class/group (minority); that he applied for a position which he qualified for; that the position was previously held by a Black; that the three persons who interviewed applicants and recommended a White employee for the position were White; that one member of his interviewing committee is not sure he understands affirmative action; that shortly before his interview, he was the subject of an unusual counseling session involving two committee members; that a member of the committee penalized him for allegedly making statements about Central employees involved in executions and later posed for a newspaper photo in the gas chamber; that the majority of other personnel interviewing committees at his institution included a minority member; that the person who appointed the interviewing committee and followed its recommendation was White; that all three committee members gave him 20 of 25 points[,] which gives the appearance of being prearranged; that at least two members of the committee based their decisions partly on hearsay or uncorroborated allegations from two White Males; that the decision resulted in Central Prison having five White Captains and one Black Captain with 44\u00b0/o of the custody staff and 50\u00b0/o or more of inmates being Black; that he scored much higher on the Captain\u2019s Eligibility Exam than the successful applicant; that his 1985 and 1986 job performance evaluations had been excellent, but he received negative comments from a committee member in his 1987 evaluation which followed his appeal of this matter; and, that he had several more years of service as a Lieutenant and more experience as acting shift commander than the successful applicant.\nThus, [Hodge] has established a prima facie case of racial discrimination.\n3. [The State], on the other hand, has given nondiscriminatory reasons for its decision to promote Lieutenant Sherwood McCabe rather than [Hodge]. McCabe received the highest ranking by the interviewing committee; he met the minimum qualifications for the position; he is well respected by inmates and staff; he has a reputation for fairness, maturity, self-control, deliberation and evaluation before acting. The members of the committee, while recognizing [Hodge]\u2019s capabilities, were concerned by allegations that his manner at times had intimidated those under his supervision. [Hodge]\u2019s outspokenness on issues such as smoking and executions at Central Prison has also aggravated some of his fellow employees and superiors. Thus, [the State] has rebutted [Hodge]\u2019s prima facie case of racial discrimination.\n4. While [the State] has advanced what it contends to be non-discriminatory reasons for not selecting [Hodge], [Hodge] has rebutted this evidence and has shown that [the StateJ\u2019s reasons were in fact a pretext for intentional discrimination. [Hodge]\u2019s evidence has shown that in addition to having more general experience than the successful applicant, [Hodge] specifically had more first shift experience. [Hodge] had been placed in charge of the first shift in an acting supervisory capacity by the previous Captain. Additionally, [Hodge] scored the highest score of all applicants on the objective test and had previously received the rating of \u201cExceeds Expectations\u201d on his WPPRs.\nAbsent a direct admission by [the State] that the decision not to select [Hodge] was based, even in part on the impermissible consideration of his race, evidence of discrimination must be gleaned from the existing facts and circumstances. In the present case, [HodgeJ\u2019s 18 years experience with [the State] during which he received high ratings on his performance evaluations, had been apparently incident free. Yet, this service and unusually high performance ratings were not considered; based on the evidence, it appears that the scores derived from the interviews were the sole ranking factors used in making a recommendation for the promotion. The incident chosen by the [State] as a factor in not selecting him, had not previously been considered significant enough to merit even an oral warning or to be documented officially until three months after the event. But, this incident was apparently significant to be one of the bases for denying this promotion to [Hodge]. One other complaint which [the State] found significant about [Hodge] was that he had irritated other employees at his unit because of his insistence that prison policy be strictly followed and because he had instigated unpopular policy changes which prohibited smoking in closed areas. The lack of significance of these two matters, in the context of eighteen years of above-average service, prompts the conclusion that these reasons were, indeed, only a pretext for racial discrimination.\n[Hodge] has met and carried his burden of showing that he was discriminated against on the basis of his race by [the State]\u2019s failure to select him for the Captain\u2019s position.\nThe Commission ordered the State to promote Hodge to the next captain\u2019s vacancy, pay Hodge \u201cback and front pay,\u201d and pay Hodge\u2019s reasonable attorney fees.\nThe State petitioned the superior court for judicial review according to N.C.G.S. \u00a7 150B-43, alleging that the Commission\u2019s order was affected by errors of law, unsupported by substantial evidence, and arbitrary and capricious. The State also submitted to the court a motion to stay operation of the Commission\u2019s order.\nAfter conducting a hearing, the superior court judge entered an order affirming the Commission\u2019s decision, based on its determination that the decision was not affected by errors of law, not contrary to presented evidence, not arbitrary and capricious, and was supported by substantial evidence in view of the entire record. The order also denied the State\u2019s motion to stay operation of the Commission\u2019s order.\nThe issues are whether the Commission\u2019s findings and conclusions are (I) (A) affected by an error of law or (B) unsupported by substantial admissible evidence; (II) whether the Administrative Law Judge erred in allowing Hodge to introduce evidence after hearing of the matter; and (III) whether the trial court erred in denying the State\u2019s motion to stay operation of the order in favor of Hodge.\nI\n\u201cOur review of an administrative agency\u2019s decision is governed by the Administrative Procedure Act, and we may reverse or modify the [agency\u2019s] decision only if it violates one of five statutory grounds.\u201d Cowan v. N.C. Private Protective Services Bd., 98 N.C. App. 498, 502, 391 S.E.2d 217, 219 (1990) (citation omitted); N.C.G.S. \u00a7 150B-51 (1987). Generally, our review is also limited by properly presented assignments of error and exceptions. N.C.R. App. P. 10 (amended 1989).\nBased on the assignment of error, we determine if \u201cthe agency\u2019s findings, inferences, conclusions, or decisions are . . . [a]ffected by . . . error of law [or] [Unsupported by substantial evidence admissible under G. S. 150B-29(a), 150B-30, or 150B-31 in view of the entire record as submitted . . N.C.G.S. \u00a7 150B-51(b)(4) and (5).\nWe apply the \u201cwhole record\u201d test in determining whether the agency\u2019s findings and conclusions are supported by substantial evidence. Cowan, at 502, 391 S.E.2d at 219 (citations omitted). As a reviewing court utilizing the \u2018whole record\u2019 test, we take into account \u201c \u2018both the evidence justifying the agency\u2019s decision and the contradictory evidence from which a different result could be reached. . . . \u201cSubstantial evidence is such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.\u201d . . .\u2019 \u201d Id. (citations omitted). In applying this test, we do not substitute our own judgment for the Commission\u2019s judgment \u201c \u2018as between two reasonably conflicting views, even though the court could justifiably have reached a different result had the matter been before [us] de novo. \u2019 \u201d Thompson v. Bd. of Educ., 292 N.C. 406, 410, 233 S.E.2d 538, 541 (1977) (citation omitted). We merely \u201cdetermine whether an administrative decision has a rational basis in the evidence.\u201d In re Rogers, 297 N.C. 48, 65, 253 S.E.2d 912, 922 (1979).\nA\nThe State contends that the Commission erred as a matter of law by applying erroneous evidentiary standards and legal principles in evaluating Hodge\u2019s claim of discrimination. We disagree.\nIn determining what test the Commission must apply, we \u201clook to federal decisions for guidance in establishing evidentiary standards and principles of law to be applied in discrimination, cases.\u201d N.C. Dept. of Correction v. Gibson, 308 N.C. 131, 136, 301 S.E.2d 78, 82 (1983).\nIt is the policy of this State to protect and safeguard the right and opportunity of all persons to seek, obtain and hold employment without discrimination or abridgement on account of race ... by employers which regularly employ 15 or more employees.\nN.C.G.S. \u00a7 143-422.2 (1987).\nAny State employee . . . who has reason to believe that . . . promotion . . . was denied him . . . because of his . . . race . . . shall have the right to appeal directly to the State Personnel Commission.\nN.C.G.S. \u00a7 126-36 (1989). The purpose of N.C.G.S. \u00a7\u00a7 126-36 and 143-422.2 is the elimination of discriminatory practices in employment, the same purpose as federal Title VII, 42 U.S.C. 2000e et seq. Gibson, at 141, 301 S.E.2d at 85.\nWhen reviewing \u201chiring and promotion decisions that were based on the exercise of personal judgment or the application of inherently subjective criteria,\u201d a court may employ either or both a \u2018disparate treatment\u2019 test and a \u2018disparate impact\u2019 test. Watson v. Ft. Worth Bank and Trust, 487 U.S. 977, 101 L.Ed.2d 827, 841-43 (1988) (citation omitted) (determining that both tests may be applied to employers using objective tests and subjective interview evaluations); Mallory v. Booth Refrigeration Supply Co., Inc., 882 F.2d 908 (4th Cir. 1989) (applying both tests). When an employee alleges that the employer treated him or her in particular less favorably than other employees, the employee raises a claim of \u2018disparate treatment.\u2019 Watson, 101 L.Ed.2d at 839. Here, Hodge alleged both types of discrimination, but offered evidence only of the State\u2019s disparate treatment form of discrimination.\nAccording to the \u2018disparate treatment\u2019 analysis, the employee \u201chas the initial burden of proving, by a preponderance of the evidence, a prima facie case of discrimination.\u201d Patterson v. McLean Credit Union, 491 U.S. \u2014, 105 L.Ed.2d 132, 157 (1989) (citation omitted). The employee meets this burden by proving that:\n[he] applied for and was qualified for an available position, that [he] was rejected, and that [3] after [he] was rejected [the employer] . . . filled the position with a white employee. . . . Once the [employee] establishes a prima facie case, an inference of discrimination arises ... to rebut this inference, the employer must present evidence that the [employee] was rejected, or the other applicant was chosen, for a legitimate, nondiscriminatory reason.... employee retains the final burden of persuading the jury of intentional discrimination.\nId. (citations omitted).\nA legitimate nondiscriminatory reason is an employer\u2019s promotion of a better-qualified employee than complainant. Id.\nAfter the employer rebuts the employee\u2019s prima facie showing, the employee has \u201cthe opportunity to demonstrate that [the employer\u2019s] proffered reasons for its decision were not its true reasons.\u201d Id.; cf. Price Waterhouse v. Hopkins, 490 U.S. \u2014, 104 L.Ed.2d 268, 281 (1989) (describing employee\u2019s burden of proof in a \u201cmixed motive\u201d case, when the employer admits to using both a nondiscriminatory motive and a questionable motive).\nThe whole record shows that the Commission used the appropriate evidentiary standards and legal principles to evaluate this evidence. The Commission\u2019s findings and conclusions clearly set out the elements of each step delineated above, including Hodge\u2019s prima facie case, the State\u2019s rebuttal and Hodge\u2019s showing of pretext, as well as the shifting burdens of production and Hodge\u2019s burdens of proof for showing racial discrimination.\nB\nThe State asserts that record evidence is insufficient to support the Commission\u2019s findings and conclusions that Hodge was in fact better qualified for the position than the promoted employee and that therefore, the State\u2019s nondiscriminatory reason was a pretext for racial discrimination. We disagree.\nIn support of the Commission\u2019s decision, the Commission first concluded as a matter of law that Hodge met his burden by showing by a preponderance of the evidence a prima facie case of discrimination. The parties stipulated that Hodge is a member of a minority race, that he was qualified for the position, and that the State rejected his application and promoted a white lieutenant.\nThe Commission next concluded as a matter of law that the State rebutted Hodge\u2019s prima facie showing by setting forth a nondiscriminatory reason for the State\u2019s decision not to promote Hodge, that the promoted lieutenant was better qualified than Hodge. In support of this reason, the State proffered evidence of the interview committee\u2019s ranking of Hodge fourth out of eight candidates, its ranking of the promoted employee first of eight candidates, and the Warden\u2019s heavy reliance on the committee\u2019s recommendation.\nThe ranking is some evidence that the promotion selection committee scored the promoted employee as higher qualified than Hodge in the categories of judgment and leadership.\nFinally, the Commission concluded as a matter of law that the State\u2019s qualification reason was a pretext for racial discrimination.\nAn employee may use \u201cvarious\u201d forms of evidence to demonstrate that the State\u2019s proffered reason was not its true reason. Patterson, 105 L.Ed.2d at 158. An employee \u201cmight seek to demonstrate that [the employer\u2019s] claim to have promoted a better-qualified applicant was pretextual by showing that [he] was in fact better qualified than the person chosen for the position. . . . [Employee] may not be forced to pursue any particular means of demonstrating that [the employer\u2019s] stated reasons are pretex-tual.\u201d Id.\nThe whole record contains substantial evidence that Hodge was in fact better qualified for the job by the criteria advanced by the State for judging applicants. The Commission had a \u2018rational basis in the evidence\u2019 for deciding that the State\u2019s decision was pretextual in light of cumulative evidence that the interviewers were sensitive to criticisms that a black would be in line for the next correctional captain position and that the State disregarded the strength of Hodge\u2019s achievement in meeting the State\u2019s criteria for promotion. Excluding the interview evaluations in comparing Hodge to the promoted employee, Hodge scored 9% higher on the eligibility examination and showed that he had 50% more experience in years working at Central Prison, and 100% more experience in years serving as a correctional lieutenant.\nThe committee\u2019s interview was the only part of the application process in which Hodge was rated less qualified than another candidate, and its rankings contradict Hodge\u2019s achievements on objective tests evaluating his knowledge of the same subjects tested in the interview. The State\u2019s use of the interview as the sole criteria for not promoting Hodge contravened its own system of promotion, in which the State used the interview as one item that carried more weight than all of the other items of evaluation combined. In any event, although cumulative scoring of the interview categories yields an eleven-point difference between the promoted applicant\u2019s score of 71 of 75 points and Hodge\u2019s grade of 60, closer evaluation of the interview scores makes insignificant this differential and shows the comparable rankings of the candidates. Each of the three interviewers evaluated Hodge on five categories, giving rise to fifteen possible scores. Hodge\u2019s scores were within one point of the promoted employee\u2019s score on fourteen of the fifteen individual scores, in several of which Hodge scored higher. On the remaining score, one interviewer rated Hodge two points lower than the promoted employee, another interviewer rated Hodge equal to the promoted employee, and the third interviewer rated Hodge one point below the promoted employee. Thus, the apparent significant downgrading of Hodge\u2019s qualifications compared to the promoted employee\u2019s qualifications evaporates in light of these slight numerical differentials and Hodge\u2019s achievements compared to the promoted employee\u2019s achievements.\nThe State contends that Hodge cannot show pretext because the interview committee rated a black applicant second most qualified for the promotion and a black would have been promoted if the white promotee did not fill the position. We disagree.\nThe evidence conflicts on whether Hodge would not have been promoted if the white promotee were removed from the position. The Central Prison personnel director testified that because of the importance of the position, the State would have conducted a new interview process if the recommended candidate had not filled the position. Such testimony does not show conclusively that the next candidate in line, a black, would have automatically received the position. Additionally, to assume automatic promotion for the employee ranked second in the interview portion of the evaluation would unduly weight the interview in contravention of the State\u2019s policy of considering all factors for promotion. The evidence reveals that the candidate rated second in the interview and eight points higher than Hodge on the fifteen interview score areas, had seven less years of experience at Central Prison than Hodge, eight less years of lieutenant experience, a 13-point lower score on the captain\u2019s eligibility test, and less favorable yearly employment appraisals.\nII\nThe State contends that it was prejudiced by the ALJ\u2019s decision to allow Hodge to submit additional evidence after holding formal hearing. Because we did not consider the additional evidence for purposes of this appeal, we discern no prejudice to the State and do not address this issue.\nIII\nThe State argues finally that the superior court erred in denying its motion to stay operation of the court\u2019s judgment for Hodge. Because we determine that the court and the Commission properly ruled in Hodge\u2019s favor, we need not address this issue.\nAffirmed.\nJudges Johnson and Parker concur.",
        "type": "majority",
        "author": "GREENE, Judge."
      }
    ],
    "attorneys": [
      "Lacy H. Thornburg, Attorney General, by Valerie L. Bateman, Associate Attorney General, for the State.",
      "Adams, McCullough & Beard, by Abraham Penn Jones, for respondent-appellee."
    ],
    "corrections": "",
    "head_matter": "NORTH CAROLINA DEPARTMENT OF CORRECTION v. EDWARD EARL HODGE\nNo. 8910SC655\n(Filed 7 August 1990)\n1. Master and Servant \u00a7 7.5 (NCI3d)\u2014 correctional officer promotion decision \u2014discrimination alleged \u2014appropriate evidentiary standards and legal principles applied\nThe State Personnel Commission, in making an award in favor of respondent employee for racial discrimination in a Central Prison correctional officer employment promotion decision, used the appropriate evidentiary standards and legal principles in evaluating the evidence of discrimination where the Commission used the \u201cdisparate treatment\u201d test; according to this analysis the employee has the initial burden of proving, by a preponderance of the evidence, a prima facie case of discrimination, which respondent in this case did; the employer then had the opportunity to rebut the employee\u2019s prima facie showing; and the employee then had the opportunity to demonstrate that the employer\u2019s proffered reasons for its decision were not its true reasons.\nAm Jur 2d, Job Discrimination \u00a7\u00a7 57, 1974, 2003.\n2. Master and Servant \u00a7 7.5 (NCI3d| \u2014 correctional officer promotion decision \u2014 nondiscriminatory reason as pretext for racial discrimination \u2014 sufficiency of evidence\nEvidence was sufficient to support the finding by the State Personnel Commission that respondent correctional officer was in fact better qualified for a captain\u2019s position than the promoted employee and that the State\u2019s nondiscriminatory reason for promoting the other employee was therefore a pretext for racial discrimination where the evidence tended to show that respondent was black and the promoted employee was white; excluding interview evaluations in comparing respondent to the promoted employee, respondent scored 9\u00b0/o higher on the eligibility examination, showed that he had 50\u00b0/o more experience in years working at Central Prison, and 100% more experience in years serving as a correctional lieutenant; the interview committee\u2019s rankings contradicted respondent\u2019s achievements on objective tests evaluating his knowledge of the same subjects tested in the interview; the State\u2019s use of the interview as the sole criteria for not promoting respondent contravened its own system of promotion, in that the State allowed the interview to carry more weight than all of the other items of evaluation combined; the eleven point difference in the promoted employee\u2019s score on the interview and respondent\u2019s score was in fact minimal in light of the fact that three interviewers evaluated the candidates on five categories, giving rise to fifteen possible scores, and respondent\u2019s scores were within one point of the promoted employee\u2019s scores on fourteen of the fifteen individual scores; and there was no conclusive showing that the next candidate in line, a black, would have automatically received the position if the recommended candidate had not filled it.\nAm Jur 2d, Job Discrimination \u00a7\u00a7 57, 1974, 2003.\nAPPEAL by the North Carolina Department of Correction from order entered 24 April 1989 by Judge A. Leon Stanback in WAKE County Superior Court. Heard in the Court of Appeals 9 January 1990.\nLacy H. Thornburg, Attorney General, by Valerie L. Bateman, Associate Attorney General, for the State.\nAdams, McCullough & Beard, by Abraham Penn Jones, for respondent-appellee."
  },
  "file_name": "0602-01",
  "first_page_order": 632,
  "last_page_order": 645
}
