City of Los Angeles Department of Water v. Manhart

Mr. Justice Marshall,

concurring in part and dissenting in part.

I agree that Title VII of the Civil Rights Act of 1964, as amended, forbids petitioners’ practice of requiring female employees to make larger contributions to a pension fund than *729 do male employees. I therefore join all of the Court’s opinion except Part IV.

I also agree with the Court’s statement in Part IV that, once a Title VII violation is found, Albemarle Paper Co. v. Moody, 422 U. S. 405 (1975), establishes a “presumption in favor of retroactive liability” and that this presumption “can seldom be overcome.” Ante, at 719. But I do not agree that the presumption should be deemed overcome in this case, especially since the relief was granted by the District Court in the exercise of its discretion and was upheld by the Court of Appeals. I would affirm the decision below and therefore cannot join Part IV of the Court’s opinion or the Court’s judgment.

In Albemarle Paper Co. v. Moody, supra, this Court made clear that, subject to the presumption in favor of retroactive relief, the District Court retains its “traditional” equitable discretion “to locate ‘a just result,’ ” with appellate review limited to determining “whether the District Court was ‘clearly erroneous’ in its factual findings and whether it ‘abused’ its ... discretion.” 422 U. S., at 424 . See also Fed. Rule Civ. Proc. 52 (a) (district court findings “shall not be set aside unless clearly erroneous”); Zenith Radio Corp. v. Hazeltine Research, Inc., 395 U. S. 100,123 (1969). The Court here does not assert that any findings of the District Court were clearly erroneous, nor does it conclude that there was any abuse of discretion. Instead, it states merely that the District Court gave “insufficient attention” to certain factors in striking the equitable balance. Ante, at 719.

The first such factor mentioned by the Court relates to the “complexity” of the issue presented here, which may have led some pension fund administrators to assume that “a program like the Department’s was entirely lawful,” and that the alternative of equal contributions was perhaps unlawful because of a perceived “unfair[ness]” to men. Ante, at 720. The District Court found, however, that petitioners “should have been placed on notice” of the illegality of requiring larger *730 contributions from women on April 5, 1972, when the Equal Employment Opportunity Commission amended its regulations to make this illegality clear. 1 The retroactive relief ordered by the District Court ran from April 5, 1972, through December 31, 1974, after which date petitioners changed to an equal contribution program. See ante, at 706. Even if the April 1972 beginning date were too early, as the Court contends, ante, at 719 n. 36, 2 during the nearly three-year period involved there surely was some point at which “conscientious and intelligent administrators,” ante, at 720, should have responded to the EEOC’s guidelines. Yet the Court today denies all retroactive relief, without even knowing whether petitioners made any efforts to ascertain their particular plan’s legality.

The other major factor relied on by the Court involves “the potential impact ... on the economy” that might result from *731 retroactive changes in “the rules” applying to pension and insurance funds. According to the Court, such changes could “jeopardiz[e] [an] insurer’s solvency and, ultimately, the insureds’ benefits.” Ante, at 721. As with the first factor, however, little reference is made by the Court to the situation in this case. No claim is made by either petitioners or the Court that the relief granted here would in any way have threatened the plan’s solvency, or indeed that risks of this nature were not “foresee[n]” and thus “included in the calculation of liability” and reflected in “the rates or contributions charged,” ibid. 3 No one has suggested, moreover, that the relatively modest award at issue — involving a small percentage of the amounts withheld from respondents’ paychecks for pension purposes over a 33-month period, see 553 F. 2d 581, 592 (CA9 1976) — could in any way be considered “devastating,” ante, at 722. And if a “devastating” award were made *732 in some future case, this Court would have ample opportunity to strike it down at that time.

The necessarily speculative character of the Court's analysis in Part IV is underscored by its suggestion that the retroactive relief in this case would have led to a reduction in the benefits paid to retirees or an increase in the contributions paid by current employees. Ante, at 722-723. It states that taking the award out of the pension fund was “apparently contemplated” by the courts below, ante, at 723, but the District Court gave no indication of where it thought the recovery would come from. The Court of Appeals listed a number of ultimate sources of the money here involved, including increased employer contributions to the fund or one lump-sum payment from the Department. 553 F. 2d, at 592 . Indeed, the Department itself contemplated that the money for the award would come from city revenues, Pet. for Cert. 30-31, with the Department thereby paying for this Title VII award in the same way that it would have to pay any ordinary backpay award arising from its discriminatory practices. Hence the possibility of “harm” falling on “innocent” retirees or employees, ante, at 723, is here largely chimerical.

There are thus several factors mentioned by the Court that might be important in some other case but that appear to provide little cause for concern in the case presently before us. To the extent that the Court believes that these factors were not adequately considered when the award of retroactive relief was made, moreover, surely the proper course would be a remand to the District Court for further findings and a new equitable assessment of the appropriate remedy. When the District Court was found to have abused its discretion by denying backpay in Albemarle, this Court did not take it upon itself to formulate an award; it remanded to the District Court for this purpose. 422 U. S., at 424, 436 . There is no more reason for the Court here to deny all retroactive relief on its own; once the relevant legal considerations are established, the *733 task of finding the facts and applying the law to those facts is best left to the District Court, particularly when an equitable search for a “ ‘just result’ ” is involved, id., at 424 .

In this case, however, I do not believe that a remand is necessary. The District Court considered the question of when petitioners could be charged with knowledge of the state of the law, see supra, at 729-730, and petitioners do not challenge the particular date selected or claim that they needed time to adjust their plan. As discussed above, moreover, no claim is made that the Department’s or the plan’s solvency would have been threatened, and it appears unlikely that either retirees or employees would have paid any part of the award. There is every indication, in short, that the factors which the Court thinks might be important in some hypothetical case are of no concern to the petitioners who would have had to pay the award in this case.

The Court today reaffirms “the force of the Albemarle presumption in favor of retroactive relief,” ante, at 723, yet fails to give effect to the principal reason why the presumption exists. In Albemarle we emphasized that a “central” purpose of Title VII is “making persons whole for injuries suffered through past discrimination.” 422 U. S., at 421 ; see id., at 418, 422 . Respondents in this case cannot be “made whole” unless they receive a refund of the money that was illegally withheld from their paychecks by petitioners. Their claim to these funds is more compelling than is the claim in many back-pay situations, where the person discriminated against receives payment for a period when he or she was not working. Here, as the Court of Appeals observed, respondents “actually earned the amount in question, but then had it taken from them in violation of Title VII.” 553 F. 2d, at 592 . In view of the strength of respondents’ “restitution”-like claim, ibid., and in view of the statute’s “central” make-whole purpose, Albemarle, 422 U. S., at 421 , I would affirm the judgment of the Court of Appeals.

The District Court quoted the following from EEOC regulations:

“Tt shall not be a defense under Title [VII] to a charge of sex discrimination in benefits that the cost of such benefits is greater with respect to one sex than the other.’ 29 CFR § 1604.9 (e).” 387 F. Supp. 980, 981 (CD Cal. 1975).

See also 29 CFR § 1604.9 (b) (1977) (employer may not "discriminate between men and women with regard to fringe benefits”) (also adopted Apr. 5, 1972); § 1604.9 (f) (employer’s pension plan may not “differentiat[e] in benefits on the basis of sex”) (adopted Apr. 5, 1972).

The Court, also contends that respondents were not entitled to a refund of the full difference between the contributions that they made and the contributions made by similarly situated men, but rather only to the difference between their contributions “and the contributions they would have made under an actuarially sound and nondiscriminatory plan.” Ante, at 720 n. 36. This point, like the question of the appropriate date discussed in text, was not. raised by petitioners and would in any event argue for some reduction in the retroactive relief awarded, not for a complete denial of such relief. On its merits, moreover, the District Court’s decision to place the women employees on an equal footing' with their male co-workers surely was not unreasonable; the alternative suggested by the Court would still have left the women with higher pension payments than similarly situated men for the relevant period.

When respondents filed their charge with the EEOC in June 1973, petitioners were put on notice of the possibility of retroactive relief being awarded. At that point they could have — and, for all we know, may have — acted to ensure that the outcome of the litigation did not affect the viability of the plan by, for example, escrowing amounts to cover the contingency of losing to respondents. A prudent pension plan administrator, however certain of his legal position, could not reasonably have ignored such a contingency.

Thus, while the Court is correct that years of litigation may ensue after a charge is filed with the EEOC, this fact is largely irrelevant to the Court’s concern about “major unforeseen contingencies,” such as an award of retroactive relief adversely affecting the financial integrity of the pension plan. Ante, at 721, 722 n. 42. And it is hardly likely that a retroactive award for the period prior to the filing of the EEOC charge would be “devastating” for the plan, since, as the Court recognizes, this period could not in any case be longer than two years. Ante, at 722, and n. 42; see 42 U. S. C. § 2000e-5 (g) (1970 ed., Supp. V). In the instant case the period from when the award began to run until the charge was filed with the EEOC was just over one year, from April 1972 to June 1973. Even the liability for this period, moreover, at most would have involved only a small percentage of the contributions made by women employees, as discussed in text, infra.