Appendix — National Organization for Women, Inc. v. United States

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Opinion of the District Court, June 7, 1974

Unirep States of America, By William B. Saxse, the At-

torney General, on Behalf of Peter J. Brennan the

Secretary of Labor, and the Equal Employment Op-

portunity Commission,

Plaintiff,

v.

ALLEGHENY-LupLUM INpvustries, INc., et al.,

Defendants.

Civ. A. No. 74-P-339-S

United States District Court

N. D. Alabama, 8S. D.

June 7, 1974

Robert T. Moore, Dept. of Justice, William L. Robinson,

Equal Employment Opportunity Commission, William J.

Kilberg, Sol. of Labor, Dept. of Labor, Washington, D. C.,

for plaintiff.

Ralph L. MeAfee, Cravath, Swain & Moore, New York

City, William K. Murray and James R. Forman, Jr.,

Thomas, Taliaferro, Forman, Burr & Murray, Birmingham,

Ala., for defendant Companies.

Michael H. Gottesman, Washington, D. C., Jerome A.

Cooper, Cooper, Mitch & Crawford, Birmingham, Ala., for

defendant Steelworkers.

Judith A. Lonnquist, NOW, Chicago, Ill., Jack Green-

berg, New York City, Oscar W. Adams, Jr., Adams, Baker

& Clemon, Birmingham, Ala., Gerald A. Smith, Baltimore,

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Opinion of the District Court, June 7, 1974

Md., Bernard D. Marcus, Kaufman & Harris, Pittsburgh,

Pa., Arthur J. Mandell, Mandell & Wright, Houston, Tex.,

William R. Jones, NAACP, New York City, J. Richmond

Pearson, Birmingham, Ala., for petitioners for interven-

tion.

MEMORANDUM oF OPINIOY

Pointer, District Judge.

After months of negotiations pursuant to the govern-

mental conciliation function of Title VII, 42 U.S.C.A.

§ 2000e et seq., the parties herein reached a tentative agree-

ment as to a manner and means for correcting allegedly

discriminatory employment practices of a systemic nature

at some 240 steel plants and other steel-related facilities

throughout the nation. The agreement was reduced to

writing in the form of two consent decrees entered into by

the United States, through various governmental agencies

including the Justice Department, the Labor Department

and the Equal Employment Opportunity Commission, as

plaintiff, and by nine steel companies and the United Steel-

workers of America, as defendants. The proposed decrees

were presented to, and entered by, this court on April 12,

1974, resulting in a broad national settlement of Title VII,

and related, disputes between the United States and the

ten defendants. The provisions reflect a thoughtful and

earnest attempt to respond to—and to reconcile competi-

tion between—charges of employment discrimination made

on behalf of black, female, and Spanish surnamed workers

and applicants.

Consent Decree I takes the form of an injunction with

respect to those matters which, in general, have previously

been affected by collective bargaining between the com-

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Opinion of the District Court, June 7, 1974

panies and the union. The decree provides for a restruc-

turing of seniority rules and regulations, primarily using

plant continuous service as a base; specifies procedures

respecting transfers, promotions, vacancies, layoffs and

recalls; and enumerates affirmative action guidelines and

goals with respect to trade and craft positions and initial

selection and assignment of employees. In recognition that

general standards may require tailoring to meet local

problems and that experience may indicate the inadequacy

of some of the remedial steps, implementation procedures

and enforcement tools are established through a structure

of Implementation Committees, composed of company,

union and minority members, at each affected facility, as

well as an Audit and Review Committee which is national

in scope. A mechanism for expeditious and co-ordinated

resolution of the multitude of pending EEOC charges re-

specting these defendants is established. A potential back-

pay fund of $30,940,000.00 is created, along with guidelines

for calculating and disbursing awards to eleciing indi-

vidual employees affected by past discrimination. Juris-

diction is retained by the court for a period of at least five

years.

Consent Decree II takes the form of a general injunc-

tion respecting those aspects of employment which are, es-

sentially, company-controlled and not normally subject to

collective bargaining agreements. The companies are gen-

erally enjoined from any form of employment disecrimina-

tion and are obligated to institute a program of affirmative

action with respect to hiring, initial assignments, and man-

agement training programs, as well as affirmative recruit-

ment of minorities. See Morrow v. Crisler, 491 F.2d 1053

(CA5 1974); Franks v. Bowman Transportation Co., 495

F.2d 398 (CA5 June 3, 1974). The court retains jurisdic-

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Opinion of the District Court, June 7, 1974

tion for at least five years; and, as also is true regarding

Consent Decree I, the consent decree between the govern-

ment and the defendants does not purport to bind any

individual employee or to prevent the institution or mainte-

nance of private litigation.

Shortly after entry of these decrees, various individuals

and organizations sought to intervene. A hearing was set

for May 20, 1974, with the request that briefs be filed by

May 13th and reply briefs by the hearing date. This memo-

randum is addressed to the claims for intervention and

certain other issues raised thereby and is issued after a

study of the motions, briefs, reply briefs, and oral argu-

ment presented at the May 20th hearing.

INTERVENTION

The court concludes that §§ 707(e) and 706 of Title VII,

42 U.S.C.A. 6§ 2000e-6(e) and 2000e-5, confer upon some

petitioners a right to intervene within the meaning of Rule

24(a)(1), F.R.Civ.P. This statutory right is provided to

a “person or persons aggrieved” within the meaning of

Title VII. In this context, the term refers to those in-

dividuals with respect to whom alleged discrimination by

the defendants is within the scope of a charge which has

heretofore been presented to the EEOC, without regard

to whether such charge was filed by them, by fellow em-

ployees with similar complaints, by an organization on

their behalf, or by a member of the EEOC, and without

regard to whether or not they are named plaintiffs or actual

or putative class members in pending litigation.

Most of the individual petitioners—including some who

joined in the petitions of the Ad Hoe Committee and of the

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Opinion of the District Court, June 7, 1974

National Organization of Women'—meet the test for inter-

vention of right under Rule 24(a)(1) as just stated. The

court concludes that the balance of the individual peti-

tioners—-including one who is the principal officer of the

Rank and File Committee, the other organizational peti-

tioner—should also be allowed to intervene, given the

rather limited purpose for which intervention is being

allowed, under the provisions of Rule 24(a) (2) or 24(b) (2).

The court denies the requests for intervention by the

three organizations, the Ad Hoc Committee, NOW, and the

Rank and File Committee. While such organizations may

have authority to file charges with the EEOC and even to

file lawsuits with respect thereto, they are not “persons

aggrieved” for the purpose of any statutory right of inter-

vention under Rule 24(a)(1). In view of the allowed inter-

vention of officers or members of such organizations, it

appears that adequate representation is being afforded for

any interest the organizations may have. See Rule 24(a)(2)

and Hines v. Rapides Parish School Board, 479 F.2d 762

(CA5 1973). Nor, indeed, have the organizations demon-

strated a sufficient interest qua organizations to justify the

additional problems of management and inconvenience

caused by unnecessary intervenors. See Bennett v. Madison

County Board of Education, 437 F.2d 554 (CA5 1970) ;

Horton v. Lawrence County Board of Education, 425 F.2d

735 (CA5 1970).

10On May 20. NOW was given leave, essentially nune pro tune,

to amend its pleadings, which were filed only on behalf of the

organization, to name not more than three individual women who

were to be allowed to intervene pursuant to Rule 24(a)(1) or (b).

Such amended pleadings were filed with the court on June 4, 1974.

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Opinion of the District Court, June 7, 1974

Such intervention as is allowed is permitted at this time?

for the limited purposes of seeking to stay or vacate the

consent decrees and to question the contemplated releases

of back-pay claims in connection with the payments of back-

pay to electing employees under the decree. While the inter-

venors are to be bound by the decision made with respect

to such limited issues, the court does not consider that such

intervenors, or any class which they may represent, are at

present bound, as a matter of res adjudicata or collateral

estoppel, to the terms of the consent decrees themselves,

No evidentiary hearings are needed with respect to the

issues on which intervention has been allowed. Based upon

responses by counsel to questions posed by the court at the

May 20th hearing, it is clear that any additional hearings

would merely involve an attempt by intervenors to demon-

strate in greater detail the alleged deficiencies and prob-

lems presented by the decrees, e. g., that the decrees are

somewhat open-ended and that there may be already some

understandings or proposals as to the manner in which

such details will be resolved.* There was no indication,

however, that any evidence would be tendered respecting

the basic allegations against the decrees which are not

apparent upon the record. Moreover, time weighs heavy

in this dispute, for not only must implementation go for-

ward to meet timetables in the decree, but also delay would

* This is without prejudice to the rights of individuals to seek

further intervention, in accordance with the rulings herein, re-

specting specifie questions which have arisen or may arise in the

future. See Hines v. Rapides Parish Schoo! Board, 479 F.2d 762

(CA5 1973). The limitation upon present intervention is placed

so that the resolution of the fundamental questions will not be

delayed by disputes over matters which, in essence, are details.

*See note 2 supra.

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Opinion of the District Court, June 7, 1974

adversely affect many of the admittedly prophylactic pro-

visions of the decrees to the detriment of the beneficiaries

of Title VII. As the court is convinced that the suggested

evidence would not materially contribute to the resolution

of the limited issues upon which intervention has been

allowed, there is no sound reason to schedule an evidentiary

hearing.

ALLEGED ILLEGALITY or ConsENT DECREE

Intervenors attack the consent decree on various grounds

of alleged illegality, including vagueness; venue deprival ;

lack of advance notice; enforcement by violators; insuffi-

ciency of relief; direct interference with rights of indi-

viduals to file, maintain or pursue individual remedies; and

a renunciation of statutory responsibility by executive

agencies.

Without here separately listing the considerations in-

volved in each of these thrusts, the court concludes that,

as attacks on the decrees as a whole, they are due to be

denied and overruled, and that the intervenors do not

demonstrate or suggest anything illegal, improper or funda-

mentally unsound in these decrees, which, it should be em-

phasized, are not binding on individual employees.

By undertaking to resolve by settlement the myriad of

problems regarding employment discrimination in the steel

industry—diseussions to which individual employees and

their supporting organizations were not privy—the execu-

tive agencies have not renounced their statutory responsi-

bilities as alleged. Such efforts are consistent, not incon-

sistent, with the statutorily mandated duty of conference,

conciliation and persuasion embodied in Title VII. It more-

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Opinion of the District Court, June 7, 1974

over appears that the commitment‘ undertaken by the

government with respect to pending or future Title VII

litigation involving these defendants does not preclude the

government from advocating, and bringing expeditiously

into court if a satisfactory resolution is not accomplished

through the settlement procedures established, a claim for

other relief by an aggrieved employee.

The court does recognize that these decrees may, as a

practical matter, impede, if not impair, some interests of

private litigants. Indeed, it must be assumed that conces-

sions during settlement negotiations were motivated in part

by the desire of the parties to avoid, by anticipatory cor-

rections, future litigation and to provide more expeditious

solutions even in matters already in the judicial processes.

Justice delayed may, it is said, be justice denied. More-

over, it must be kept in mind that resolution in this forum

of issues between the government and the defendants does

not preclude additional—or even inconsistent—relief in

favor of private parties in other litigation. As stressed by

Congress in the passage of Title VII and its amendments,

settlement offers the principal hope for rapid correction

of the ills of employment discrimination, preserving, how-

ever-—as here—the right to litigate where the persons

aggrieved are not parties to the conciliation agreement and

believe the settlement to be unsatisfactory.

‘A letter from the original parties herein was received by the

court on June 3, 1974. Such has been filed on record as it serves

to clarify the obligations of the United States with respect to future

action pursuant to the coiisent deerees. Nor would it be sound to

assume that the government can not oppose relief sought by a

private litigant: for example, if a particular black plaintiff, due

to his own situation, were to seek an occupational seniority rule

considered by the EEOC to be generally adverse to the interests

of other black employees, it eonld hardly be asserted that the

EEOC is bound to advocate such relief.

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Opinion of the District Court, June 7, 1974

Some of the wording of the consent decrees may on its

face improperly affect the maintenance of private actions.

For example, the decrees provide for mailing of back-pay

notices even to those involved in pending litigation as

named plaintiffs or as determined or putative class mem-

bers. In view of the court’s retained powers and in view

of the presence of the parties to this litigation before other

forums, such problems, as they are identified, can be sat-

isfactorily resolved, and no doubt there will be a need

from time to time for liaison and co-ordination between this

court and other forums. The decrees may require clarifica-

tion in some particulars and, indeed, as administration of

the decrees continues, there will doubtless be problems

which were not considered or anticipated by the parties or

which run counter to their expectations during negotia-

tions. Should such eventualities occur, the court, by virtue

of paragraph 20° of Consent Decree I and paragraph 2°

of Consent Decree II, has jurisdiction of this cause for

the purpose of issuing subsequent orders, consistent with

principles of due process, as necessary to further the pur-

poses and objectives of these decrows.'

5“90 Retained Jurisdiction—The court hereby retains jurisdic-

tion of this cause for the purpose of issuing any additional orders

or decrees needed to effectuate, clarify or enforce the full pur ose

and intent of this Decree.

Anytime after the conclusion of five (5) years from the dat» of

this decree, any party may move to dissolve this decree in whole

or in part.”

¢“9 The court hereby retains jurisdiction of this cause for the

purpose of issuing any additional orders or decrees needed to

effectuate, clarify or enforce the full purpose and intent of this

decree and/or the agreement attached hereto.

Anytime after the conclusion of five (5) years from the date of

this decree, any party may move to dissolve this decree in whole

or in part.”

7 By leters of June 3, 1974, referred to in note 4 supra, the

original parties herein have stated that all parties accept the

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Opinion of the District Court, June 7, 1974

The court finds nothing illegal respecting the consent

decrees themselves, neither in the basic approach to settle-

ment reflected therein, the way in which such were negoti-

ated and entered, nor the manner in which such will be

implemented. Parenthetically, the court notes that the sug-

gestion that advance notice was a requirement for the

decree—which does not rise to the status of a class action

decree—would likely haunt, if adopted by the court, the

intervenors and their sponsoring organizations in other

litigation. Cf. Eisen v. Carlisle & Jacquelin, 42 U.S.L.W.

4804, —— US. , 94 S.Ct. 2140, 40 L.Ed.2d 732 (May

28, 1974).

ALLecep ILuecaALity or Back-Pay RELEASE

In connection with the claim of illegality, some inter-

venors have raised the question of the binding effect of a

release executed by employees who accept back-pay under

the deeree. The consent decree, however, while providing

for the use of such a release, does not contain a judicial

finding or conclusion that such could be efficacious. This is

an issue in which all parties have an interest and, as a

practical matter, is in need of a present resolution. The

basic question is whether a signed release in exchange for

the payment of back-pay determined under a settlement

court’s view of authority to review any action taken pursuant to

the decrees, including actions of the Audit and Review Committee,

whether or not any party requests such review. Also, such parties,

while perhaps disagreeing with the court as to the limits involved,

acknowledge the concept of retained jurisdiction with respect to

the effectuation of the full purpose of the decrees. Notwithstanding

any such disagreement with the court’s view of such powers, the

parties advised the court “that none of them wishes to cancel or

revoke its consent or withdraw from the Consent Decrees in the

above-captioned case.”

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Opinion of the District Court, June 7, 1974

procedure, as contemplated in paragraph 18(g) of Consent

Decree I, can be valid as a matter of public policy.

Intervenors cite, among other similar decisions, Schulte

v. Gangi, 328 U.S. 108, 66 S.Ct. 925, 90 L.Ed. 1114 (1946),

an FLSA case, for the proposition that such a release

would be invalid as contravening public policy. Such FLSA

cases are, however, distinguishable from the instant case.

Relief under the FLSA is defined, 29 U.S.C.A. § 216(e),

while Title VII relief is more flexible, 42 U.S.C.A. § 2000e-

5(g). While the amount of back-pay for an FLSA viola-

tion is, essentially, a matter of simple calculation subject

only to the statutory requirements of the Act, Title VII

back-pay awards are much more difficult of ascertainment

as such are subject to innumerable variables. Schulte

seems to be most concerned with the leverage afforded em-

ployers if employees could be persuaded or coerced into

waiving statutory pay minimums.

The legislative history of Title VII, as well as the Act

itself in providing substantial mechanisms for conciliation

and settlement, 42 U.S.C.A. §§ 2000e-5(b) and (f), indi-

eates a Congressional desire for out-of-court settlement

of Title VII violations.

In Alexander v. Gardner-Denver Co., 42 U.S.L.W. 4212,

4219, 415 U.S. 36, 94 S.Ct. 1011, 39 L.Ed.2d 147 (1974) the

Supreme Court indicates that there presumably may be

an effective release of Title VII claims where the parties

enter into a voluntary settlement. For such a waiver to

be effective, however, the employee’s consent to the set-

tlement must be both “voluntary and knowing’’. /d. at 4219

n. 15, 415 U.S. 52, 94 S.Ct. 1021, 39 L.Ed.2d 147. See also

Petitway v. American Cast Iron Pipe Co., 494 F.2d 211 at

notes 152 and 156a (CA5 1974), in which the Fifth Circuit

12a

Opinion of the District Court, June 7, 1974

seems to indicate its approval of voluntary settlement of

similar issues,

This court concludes that there can be a legal waiver

of back-pay claims where, for valuable consideration, a

release is signed knowingly and voluntarily, with adequate

notice which gives the employee full possession of the

facts. Such a ruling, however, is not to be taken as a pro-

spective ruling on the question of the efficacy of any par-

ticular release, as such would require an individual de-

termination of the factual setting in which such a release

may be executed. '

ConcCLUSION

For the reasons indicated, the court has allowed inter-

vention by the individual petitioners for the limited pur-

poses of seeking to stay or vacate the consent decrees and

of challenging the legal efficacy of settlement releases of

back-pay claims and has denied the claims of such inter-

venors with respect thereto. Intervention by other peti-

lioners or for other purposes has, at present, been denied,

By separate document, the order of the court with respect

to such matters is filed concurrently herewith.

13a

Opinion of the Court of Appeals, August 18, 1975

Unrrep Srates or America, et al.,

Plaintiff s-A ppellees,

v.

Arcecueny-LupLum Inxpustnies, Inc., et al.,

Defendants-A ppellees,

Siwney S. Hanais, et al.,

Intervenors-A ppellants,

NationaL Orcanization For Women, Inc., et al.,

Movants-Appellants.

No. 74-3056

United States Court of Appeals

Fifth Circuit

Aug. 18, 1975

Oscar W. Adams, Jr., Birmingham, Ala., Kenneth L.

Johnson, Baltimore, Md., Bernard D. Marcus, Pittsburgh,

Pa., Arthur J. Mandell, Gabrielle K. MeDonald, Mark T.

McDonald, Houston, Tex., J. Richmond Pearson, Birming-

ham, Ala., Nathaniel R. Jones, NAACP, New York City,

for S. S. Harris and others.

Judith A. Lonnquist, Chicago, Ill., Kenneth L. Johnson,

Emily M. Rody, Baltimore, Md., Jack Greenberg, James

M. Nabrit, I], Barry L. Goldstein, New York City, for

National Organization for Women and others.

I4a

Opinion of the Court of Appeals, August 18, 1975

William J. Kilberg, Sol. of Labor, U. S. Dept. of Labor,

Washington, D. C., Wayman G. Scherrer, U. 8. Atty., Bir-

mingham, Ala., Leonard L. Scheinholtz, Pittsburgh, Pa.,

Robert T. Moore, U. S. Dept. of Justice, Washington, D. C.,

Francis St. C. O'Leary, Pittsburgh, Pa., William A. Carey,

Gen. Counsel, William L. Robinson, Joseph T. Eddins,

EEOC, Washington, D. C., for U.S.A. and Wheeling-Pitts-

burgh Steel Corp.

William K. Murray, James R, Forman, Jr., Birmingham,

Ala., for U. S. Steel Corp., Allegheny-Ludlum Industries,

Republic Steel, Youngstown Corp., Bethlehem Steel, Wheel-

ing-Pittsburgh Steel, Armco Steel, National Steel, Jones-

Laughlin.

Michael H. Gottesman, Washington, D. C., Jerome

Cooper, Birmingham, Ala., for Steelworkers.

Carl B. Frankel, Asst. Gen. Counsel, United Steelworke “s

of America, Pittsburgh, Pa., Marshall Harris, Asso. Sol.

Labor Relations, Civ, Rights, Dept. of Labor, Washington,

D. C., Vincent L. Matera, Pittsburgh, Pa., for U. S. Steel

Corp.

Ralph L. MeAfee, New York City, for Bethlehem Steel.

David Scribner, New York City, James H. Logan, Pitts-

burgh, Pa., Elizabeth M. Schnieder, Doris Peterson, Center

for Constitutional Rights, New York City, for amici curiae.

Appeals from the United States District Court for the

Northern District of Alabama.

Before THornperry, Morcan and Cuark, Circuit Judges.

THORNBERRY, Circuit Judge:

These appeals present novel and important issues which

require us to consider the scope of the federal government’s

15a

Opinion of the Court of Appeals, August 18, 1975

authority to encourage and negotiate expeditious and effi-

cient settlement of widespread charges of employment dis-

crimination in the nation’s steel industry. Some of these

issues are procedural in nature; others call into question

the substantive legality of the means utilized. Some issues

are ripe for decision; others are essentially hypothetical

and conjectural. During the interim between the oral argu-

ment of these appeals in December, 1974 and the present,

we have carefully examined the attacks which have been

advanced against the settlement. Our conclusion is that the

settlement has not been shown to be in any respect unlawful

or improper, and hence its terms, conditions, and benefits

must go forward immediately in their entirety.

JT. IntTnuvuctTIon AND BacKGROUND

On April 12, 1974, a complaint was filed in the federal

district court for the Northern District of Alabama. The

plaintiffs were the United States, on behalf of the Secre-

tary of Labor, and the Equal Employment Opportunity

Commission. Nine major steel companies' and the United

Steelworkers of America were named as defendants. The

suit involved some 240-250 plants at which more than

300,000 persons are employed, over one-fifth of whom are

black, Latin American, or female. Alleging massive pat-

terns and practices of hiring and job assignment discrim-

ination on the bases of race, sex, and national origin, the

1The companies are Allegheny-Ludlum Industries, Ine., Armeo

Steel Corporation, Bethlehem Steel Corporation, Jones and Laugh-

lin Steel Corporation, National Steel Corporation, Republie Steel

Corporation, United States Steel Corporation, Wheeling-Pittsburgh

Steel Corporation, and Youngstown Sheet & Tube Company. Ac-

cording to one estimate, the complaint reached seventy-three per-

cent of the country’s basic steel industry. Brief for the appellee

steel companies at 3 n. 2.

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Opinion of the Court of Appeals, August 18, 1975

complaint sought to enforce the edicts of Title VII of the

Civil Rights Act of 1964, as amended, 42 U.S.C. § 2000e

et seq., and contractual obligations under Executive Order

11246, as amended, 3 C.F.R. 160 et seq. (1974).

The complaint charged that the companies had violated

Title VII and Executive Order 11246 by hiring and assign-

ing employees on impermissible grounds, and by restricting

ethnic minorities and females to low-paying and undesir-

able jobs with scant opportunities for advancement. The

complaint also charged the companies and the union with

formulating collective bargaining contracts which estab-

lished seniority systems for promotion, layoff, recall and

transfer so as to deprive minority and female employees

of opportunities for advancement comparable to those

enjoyed by white- males.

The filing of the complaint culminated more than six

months of intensive, hard-fought negotiations between, on

one side, the EEOC and Departments of Justice and Labor,

and on the other the companies and the union, Simultane-

ously with the filing of the complaint, the parties announced

to the court that a tentative nationwide settlement had been

reached. The parties multilaterally reduced their agree-

ment to the form of two extensive written consent decrees.

Describing the decrees as “a thoughtful and earnest attempt

to respond to—and to reconcile competition between—-

charges of employment discrimination made on behalf of

black, female, and Spanish surnamed workers and appli-

cants,”* District Judge Pointer signed and entered the

documents later that same day.*

* See United States v. Allegheny-Ludlum Indus., Ine., N.D.Ala.

1974, 63 F.R.D. 1, 3.

* The two consent decrees are reprinted in BNA FEP Manual

431 :125—152 (1974). The correct entry date, as reflected in the

record, is April 12, 1974, rather than April 15.

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Opinion of the Court of Appeals, August 18, 1975

Consent Decree I is aimed at the practices of the union

as well as those of the steel companies. It permanently

enjoins the defendants from “discriminating in any aspect

of employment on the basis of race, color, sex or national

origin and from failing or refusing to fully implement”

the substantive relief set forth therein. The items covered

by Consent Decree I are mainly matters historically encom-

passed by collective bargaining. The substantive relief

falls into three basic categories: (1) immediate implemen-

tation of broad plantwide seniority, along with transfer

and testing reforms, and adoption of ongoing mechanisms

for further reforms of seni~rity, departmental, and line of

progression (LOP) structures, all of which are designed

to correct the continuing effects of past discriminatory

assignments; (2) establishment of goals and timetables for

fuller utilization of females and minorities in occupations

and job categories from which they were discriminatorily

excluded in the past; and (3) a back pay fund of $30,-

940,000, to be paid to minority and female employees

injured by the unlawful practices alleged in the complaint.‘

Consent Decree II and its accompanying Agreement deal

‘with aspects of employment which are mainly company-

controlled and thus not subject to collective bargaining.

The companies again are broadly enjoined from any form

of unlawful employment discrimination. Also, Consent De-

‘Paragraph 18(c) of Consent Decree I defines as the affected

classes of employees eligible to receive back pay: (1) minority

(black and Spanish-American surnamed) employees in Production °

and Maintenance units who were employed prior to January 1,

1968; (2) all females in Production and Maintenance units as of

the date of decree entry; and (3) those former employees who

retired on pension within the two years preceding entry of the

decrees, who, if they were still employed, would be within group

(1) or group (2). Provision is also made for payment of back

pay to surviving spouses of otherwise eligible deceased employees.

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Opinion of the Court of Appeals, August 18, 1975

cree IT requires the companies to initiate affirmative action

programs in hiring, initial assignments, promotions, man-

agement training, and recruitment of minorities and fe-.

males.

The decrees must be made to function in varying and

peculiar situations in accordance with the parties’ ambi-

tious objectives. Furthermore, the parties contemplated

that unforeseen interpretive issues will inevitably arise

and require resolution. With these considerations in mind,

the decrees provide for the establishment of implementa-

tion and enforcement procedures through a system of Im-

plementation Committees. These committees are estab-

lished at each major plant to which the decrees are made

applicable. Each committee includes at least two union

representatives, one of whom is a member of the largest

minority group in the piant,® and an equal number of com-

pany members. The government is entitled to designate a

representative to meet with any Implementation Commit-

tee. The Implementation Committees are charged with as-

suring compliance with Consent Decree I, including changes

in local seniority rules and LOPs, as well as the establish-

ment of goals and timetables for affirmative action under *

paragraph 10. In addition, it is the Implementation Com-

mittees’ responsibility to furnish employees with informa-

tion about their rights under the settlement.

The Audit and Review Committee, established under

paragraph 13 of Consent Decree I, is the hub mechanism

in the decrees’ system of continuing review, enforcement,

and compliance. It is composed on an industry-wide basis

* Paragraph 12 of Consent Decree I provides for a seeond min-

ority member at plants in which at least ten percent of the em-

ployees comprise a second minority group, unless one of the union

representatives is already from that minority group.

19a

Opinion of the Court of Appeals, August 18, 1975

of five management members, five union membe1s, and one

government member. It meets regularly to oversee com-

pliance with the decrees and to resolve disputes which come

before it, including any questions that the Implementation

Committees have been unable to resolve. Matters which

the Audit and Review Committee cannot resolve unan-

imously may be brought before the district court. Fur-

thermore, all parties to the decrees have stipulated on the

record that paragraph 20 of Consent Decree I, which vests

the district court with continuing jurisdiction for at least

five years, permits the court to review fully and, if nec-

essary, correct any action taken pursuant to the decrees,

irrespective of whether a party requests such review. Be-

ginning no later than December 31, 1975, the Audit and

Review Committee will review the entire experience under

Consent Decree I. The committee may then propose

remedial steps at any plant in order to overcome deficien-

cies in either the decree or its results. If the government

representative remains dissatisfied with a committee pro-

posal, he may take the matter to the district court. Finally,

the Audit and Review Committee is responsible at least

annually for reviews of the various Implementation Com-

mittees’ performance in establishing and fulfilling affirma-

tive action goals in job assignment, hiring, promotion and

seniority, and minority-female recruitment.

As the district court correctly determined, neither de-

cree purports “to bind any individual employee or to pre-

vent the institution or maintenance of private litigation.” *

At the time of the decrees’ entry, hundreds of employment

discrimination charges were pending against the defen-

dants before the EEOC and federal district courts scattered

*63 F.R.D. at 4.

20a

Opinion of the Court of Appeals, August 18, 1975

throughout the country. Between twenty and sixty thou-

sand minority and female individuals then stood beneath

the overlapping umbrellas of these charges as members of

putative aggrieved classes in actions seeking systemic in-

junctive relief and back pay. Thousands still do, and the

problems of administrative and judicial management are

truly awesome.’ The consent decrees establish a formula

7A revealing illustration is the purported class action involving

United States Steel’s Fairfield Works in Alabama, now pending

on appeal before this court, No. 73—3907, Ford, et al. v. United

States Steel Corp., et al., partially reported below at 371 F.Supp.

1045 (N.D.Ala. 1973). Approximately 12,000 people are employed

at Fairfield Works, around 3,100 of whom are black. Between six

and eight private class actions were consolidated for trial. Back

pay was awarded to some members of three classes, but denied as

to the other classes. A total of sixty-one people, or thirteen percent

of the members of the certified private classes, received back pay

awards. The other eighty-seven percent, or 403 blacks, were denied

back pay. Nonetheless, in anticipation of the appeal, the district

court on May 2, 1973 amended the class certification order to re-

define the plaintiff class as: (1) all blacks, except those already

members of a private class whose rights had been adjudicated, who

had been employed at Fairfield Works at any time prior to Jan-

uary 1, 1973; and (2) all blacks who had unsuccessfully sought

employment at Fairfield Works prior to January 1, 1973. Although

we have no reliable estimate on the combined size of the resulting

class, subclass (1) alone is sufficiently large to have encouraged

the defendants to enter into consent decrees with the government,

in which $30.9 million is promised in back pay, “several million

dollars” of which represents United States Steel’s allotment, prin-

cipally for blacks, but also for female and Spanish-surnamed work-

ers at Fairfield Works. Brief for Appellee United States Steel

Corp., at 7, No. 73—3907, Ford, et al. v. United States Steel Corp.,

et al.

The Fairfield Works case also involved pattern or practice charges

brought by the United States, resulting in an appeal by the govern-

ment from denial of certain injunctive relief and denial of back

pay to black employees who were not represented in the private

class actions. Sinte the government is now admittedly satisfied

with the rate retention and back pay provisions of subsequently-

negotiated Consent Decree I, paragraphs 8 and 18 thereof respec-

tively, it has withdrawn its appeal in Ford pending our decision

21a

Opinion of the Court of Appeals, August 18, 1975

for expeditious and coordinated resolution of the multitude

of pending charges. With respect to pending cases in

which district courts have already entered remedial de-

crees, the government, companies, and union have agreed

to petition those courts for amendments to conform their

relief to that contained in the consent decrees. The same

action is being taken with respect to orders of the Secre-

tary of Labor, rendered pursuant to Executive Order

11246, which were issued prior to entry of the decrees. In

regard to other pending litigation, the parties to the con-

sent decrees have agreed that release forms and notices to

employees pursuant to subparagraphs 18(g) and (h) of

Consent Decree I shall be forwarded to the courts trying

the private actions, as well as to Judge Pointer for ap-

proval prior to distribution to all other affected employees.

The parties have agreed on the record that they will ob-

serve any order or instruction issued by any of these

courts. Audit and Review Committee Directive No. 1, 5,

May 31, 1974.

Under introductory paragraph C of each decree, the

government has stipulated that in future cases involving

private claims for relief, other than back pay, which would

be inconsistent with the systemic relief provided by the

decrees, the government will suggest to the forum court

that the relief sought is unwarranted in the separate pro-

as to the validity of the consent decrees sub judice. Stipulation of

the Parties, filed July 8, 1974.

Last but not least, in an Order filed December 23, 1974, Judge

Pointer entered an unopposed amendment in Ford conforming the

injunctive relief for Fairfield Works to that provided by the

consent decrees, in all minimum respects except back pay. Since

the issue of classwide back pay is still on appeal to this court in

Ford, Judge Pointer ordered postponement of further back pay

availability in that ease until fina! decision of the appeals in Ford

and in this case.

22a

Opinion of the Court of Appeals, August 18, 1975

ceeding. The government, however, may proceed through

the Audit and Review Committee mechanism to recommend

that matters raised in the separate proceeding be sub-

mitted to Judge Pointer for resolution within the frame-

work of the consent decrees. The government concedes, of

course, and no one seriously argues contrariwise, that no

forum court will be legally obliged to follow any govern-

ment recommendation of dismissal, stay, or transfer as to .

any separate suit filed in such court.

With respect to charges pending at the administrative

level at the time of the decrees’ entry, the EEOC has

agreed in paragraph 19 to expedite its processing schedule.

The Commission will first identify those charges that al-

lege violations for which the appropriate remedies are

wholly within the seope of the decrees. In those cases, the

EEOC will consider the charges settled and so notify the

charging party. In addition, it will recommend to the

charging party that he or she accept the back pay provided

under paragraph 18(c) of Consent Decree I. As discussed,

infra, the charging party is free to reject the EEOC’s rec-

ommendation and commence a private suit for greater back

pay or any other relief. As for pending charges that re-

‘ate to matters which are not wholly within the scope of

the decrees, the Commission will conduct the usual in-

vestigations and attempt to conciliate the charges. In all

such cases, the time in which a charging party must decide

whether to claim the back pay under paragraph 18 will be

suspended during the administrative proceedings.

The overriding goal of the United States, the Secretary

of Labor, the EEOC, the companies, and the union is

comprehensive, final and fair settlement of charges of un-

lawful employment discrimination arising from patterns

and practices alleged upon the part of the companies and

23a

Opinion of the Court of Appeals, August 18, 1975

the union up to and including the entry date of the consent

decrees. Accordingly, introductory paragraph C of each

decree provides for binding resolution, between and among

the parties to the decrees, of all issues treated by the de-

crees, together with all issues which may arise as future

effects of the resolved pre-decree discriminations. To the

extent the defendants maintain compliance with the de-

crees as to issues covered and which through the various

procedures may become covered thereby, the government

has agreed that it shall deem the defendants to have com-

plied with Title VII and Executive Order 11246.* As to

matters which originate in discriminations ccecurring prior

to and including the entry date, and which are covered by

the complaint or the decrees, the settlement is res judicata

between and among its signatories.

Two important factors, however, warrant clarification at

this point. First, no private individual, as such, is a party

to the consent decrees. Thus, the consent decrees do not

seek by their terms to bind private individuals by way of

res judicata or estoppel by judgment. It is only through

the acceptance of the back pay and legally effective execu-

tion of the release contemplated by paragraph 18(g) of

Consent Decree I that a private individual can compro-

mise, by virtue of the decrees, any right that he may have.

Apart from the $30,940,000 back pay fund, paragraphs 17

and 18 establish mandatory procedures for fully informing

private parties of their rights. Paragraph 18 sets up spe-

cifie guidelines and standards for computing and delivering

back pay awards to electing employees. The Implementa-

tion Committees, the Audit and Review Committee, and

* Paragraph 16 of Consent Decree I contains a corresponding

stipulation on behalf of the Secretary of Labor and the Office of

Federal Contract Compliance.

24a

Opinion of the Court of Appeals, August 18, 1975

ultimately the district court bear the critical responsibility

to insure that individual employees have the opportunity

to make free, intelligent decisions whether to accept the

back pay under the consent decrees,

The second factor relates to the nature of the consent

decrees’ finality as contemplated by paragraph C. In that

paragraph, the plaintiffs United States, the Secretary of

Labor, and the EEOC have stated in so many words that

they consider the decrees remedially adequate to bring the

defendants into present compliance with federal anti-dis-

crimination law and to con:pensate individual employees

for the past and continuing effects of the alleged disecrim-

inatory practices which the decrees enjoin. Because the

plaintiffs believe that the decrees are sufficient to those pur-

poses, they have stipulated that the decrees are res judicata

with respect to all legal, factual, and remedial issues within

the scope of the complaint and the decrees, In other words,

the plaintiffs—and we take the parties at their word at oral

argument—have merely consented to proceed within the

mechanics of the decrees in lieu of filing additional law-

suits and seeking additional judgments against the de-

fendants with respect to matters covered by the decrees.

Also because they believe that the decrees provide ade-

quate relief, the plaintiffs have agreed that compliance with

the decrees shall be deemed compliance with Title VIT and

Executive Order 11246. Nonetheless, it is our understand-

ing of the submissions to this court on behalf of all par-

ties to the decrees that the government remains entirely

free, from and after the date of entry, to police the im-

plementation of the decrees for repeated or new violations

of the injunctive provisions, and furthermore that the gov-

ernment shall be entitled to treat such suspected violations

as new violations of Title VII and/or Executive Order

25a

Opinion of the Court of Appeals, August 18, 1975

11246, by reason of which the government shall not be

barred from bringing the matter to the attention of the

district court for new injunctive correction, if necessary.

Correspondingly, in light of the parties’ stipulation as to

the scope of the district court’s continuing jurisdiction, we

construe paragraph 20 of Consent Decree I as authorizing

any aggrieved individual to proceed in similar fashion. If

the grievance arises from a transaction or episode to which

the injunctive provisions of the decrees apply, then we

understand the court directly.’ If the grievance involves an

allegation of new discrimination occurring subsequent to

entry date, then it is our understanding that the individual

may file a charge with the EEOC, and/or a lawsuit if he

or she chooses, and expect the same quality of administra-

tive and judicial consideration to which an employment

discrimination complainant would be entitled in any other

American industry.

Having sketched—by no means exhaustively—the terms

of the settlement, the parties’ interpretation thereof, and

* Of course, the parties to the decrees will encourage the grievant

to proceed initially through Implementation and Audit and Review

Committee channels, if the grievant seeks systemic relief. Also,

that procedure obviously will be the most viable alternative for

employees who reside at a distanee from the Northern District of

Alabama. Yet the decrees themselves—and particularly paragraph

20 of Consent Deeree JT, see also paragraph 2 of Consent Decree

I!—are open-ended in that they do not purport to impose adminis-

trative «x!austion requirements upon the individual in excess of

those otherwise imposed by law. Thus, it is quite reasonable to

infer that any obstacles which the individual may encounter en

route to any given courthouse must arise by virtue of rules of law

or compromises that exist independently of the hare terms of the

consent decrees, In any event, with respect to questions concerning

any matter resolved by the decrees, the parties thereto have stipu-

lated that the district court may assume jurisdiction on its own

motion, Hence, the deerees do not by their own force attempt to

inhibit anyone’s access to judicial process or the availability of

judicial review.

26a

Opinion of the Court of Appeals, August 18, 1975

our general understanding of what the parties intended by

their words and deeds, we turn now to the adversary en-

- vironment which produced these appeals.

II. Private INTERVENTION :

CompLaints, ProceepiIncs, AND APPEALS

The consent decrees were entered on April 12, 1974. By

May 17, 1974, three organizations, four individuals, and six

groups” of plaintiffs in actions pending before various

district courts had moved to intervene and to vacate the

decrees. The district court invited the movants to file

briefs, offer proof, and make oral arguments at the hear-

ing conducted on May 20. At the conclusion of the hear-

ing, the court narrowed the issues in intervention to two

points: (1) whether the decrees should be stayed or va-

eated as unlawful or improper in their entirety; and (2)

the validity of the contemplated releases of claims for addi-

tional relief in connection with the payment of back pay

to employees so electing under the consent decrees.

The district court granted intervention as of right, in-

tendedly pursuant to § 706(f)(1) of Title VII, 42 U.S.C.

©The Harris group, certain members of which are the principal

appellants herein, consists of seven sub-groups, the first of which

claims to represent all black employees, past, present, and future,

of all defendant companies at plants in which the Steelworkers’

Union is the employees’ bargaining representative. The next six

sub-groups claim to represent six private classes in pending ac-

tions: Harris, et al. v. Republic Steel Corp., et al., N.D.Ala., C.A.

No, 74—P—3345; Ford, et al. v. United States Steel Corp., et al.,

N.D.Ala., C.A.No. 66—625, sce note 7, supra; Taylor, et al. v. Armeo

Steel Corp., et al, S.D.Tex., C.A.No.68—129: Walker, et al. v.

Republic Steel Corp., et al., 'N.D.Ala., C.A.Nos.71—179, 71—180,

71—-181, 71—185; Lane, et al. v. Bethlehem Steel Corp., et al.,

s Md., C.A.No. 71-580—H: Rodgers, et al. v. United States Stee!

Corp., et al, WD.Pa., C A.No.71—793.

27a

Opinion of the Court of Appeals, August 18, 1975

§ 2000e-5(f)(1), and F.R.Civ.P. 24(a)(1), to a group of

thirty-six individuals with respect to whom charges of

discrimination on the part of the defendants had been filed

with the EEOC. Thirty-three of these individuals were

members of the Harris group. The court also granted per-

missive intervention under F.R.Civ.P. 24(b) to the prin-

cipal officer of the Rank and File Team, an organization

composed of rank and file members of the Steelworkers’

Union. Judge Pointer denied all other motions for inter-

vention, including that filed by the National Organization

of Women (NOW), appellant herein. Among the thirty-

six persons as to whom the court allowed intervention by

right, however, three were women specifically appointed by

NOW at Judge Pointer’s request, and represented by

NOW’s counsel throughout the proceedings."

In his memorandum opinion of June 7, 1974, see 63 F.R.D.

1, 5, Judge Pointer refused to stay or vacate the consent

decrees and upheld their validity against the intervenors’

attacks. He determined first that no evidentiary hearing

was needed, since the intervenors sought mainly to pre-

sent legal hypotheses and argument rather than evidence.

Next, the court rejected contentions that the government

had abdicated or bargained away its responsibilities under

Title VII and Executive Order 11246. While recognizing

that the decrees may require authoritative construction

and clarification from time to time, Judge Pointer deemed

such potential difficulties within his control by virtue of

the court’s continuing jurisdiction. With respect to the

On June 4, 1974, Judge Pointer permitted NOW to file an

amended complaint in intervention on behalf of the three women,

who represented aggrieved classes of former, present, and future

female employees of the defendant steel companies. Judge Pointer

also received from NOW extensive briefs concerning the effects of

the consent decrees upon the rights of females.

28a

Opinion of the Court of Appeals, August 18, 1975

alleged illegality of the back pay settlement releases, Judge

Pointer defined the issue as “whether a signed release in

exchange for the payment of back-pay determined under a

settlement procedure, as contemplated in paragraph 18(g)

of Consent Decree I, can be valid as a matter of public

policy.” Td. at 7. Relying on recent language by the Su-

preme Court,” he held in the affirmative, provided the em-

ployee’s consent is both “ ‘voluntary and knowing,’ ” with

“adequate notice which gives the employee full possession

of the facts.”’ Id.

As a procedural matter, Judge Pointer also relaxed his

earlier orders denying intervention to the majority of the

movants. The final memorandum of June 7 denies such

intervention without prejudice to the rights of private par-

ties to seek further intervention as to questions which may

arise in the future. Similarly, whereas Judge Pointer con-

sidered his opinion binding upon those to whom he granted

intervention as to the issues therein determined, he stated

explicitly that he did not consider any private intervenor

or class of private parties bound by principles of res judi-

cata to the consent decrees. Id. at 4 n. 2, 5.

NOW appeals the district court’s refusal to allow inter-

vention by the organization qua organization. It has also

filed a brief and presented oral argument on the merits in

behalf of the three female appellants to whom Judge

Pointer granted intervention. The intervenors from the

Harris group appeal the district court’s judgment sustain-

ing the overall legality of the consent decrees, although

they complain primarily about the back pay features rather

than the decrees’ injunctive provisions. No other appeals

12 See Alexander v. Gardner-Denver Co., 415 U.S. 36, 52 & n. 15,

94 S.Ct. 1011, 1021 & n. 15, 39 L.Ed.2d 147, 160 & n. 15 (1974).

29a

Opinion of the Court of Appeals, August 18, 1975

are properly before this court.’* For the reasons which

follow, we affirm the judgment of the district court insofar

as it rejected the contentions of the Harris intervenors

and the three females nominated by NOW. We dismiss the

appeal of NOW qua organization for want of jurisdiction.

Ill. Dentat or NOW’s Motion To INTERVENE

Logical analysis of any question concerning intervention

in federal court begins with Rule 24 of the Federal Rules

of Civil Procedure. The rule establishes ground rules for

13 The record reflects that attorneys for the Harris group also

listed the National Ad Hoe Committee of Steelworkers, as to which

the district court denied intervention, in the Harris intervenors’

Notice of Appeal. On appeal, however, the Ad Hée Committee has

filed only a brief as Amicus Curiae, joined by the District 31

Committee to Defend the Right to Strike along with the Rank and

File Team. Of the issues briefed by Amici, only those relating to

the alleged illegality of the back pay releases have been presented

to this court by the briefs of NOW, the three women represented

by NOW, and the Harris intervenors. The other issues briefed by

Amici were not raised in the district court, and for that reason

we shall not consider them. Cf. Wisconsin Barge Line, Ine. v.

Coastal Marine Transport, Inc., 5 Cir. 1969, 414 F.2d 872, 876,

and cases cited.

16 Rule 24.

Intervention

(a) Intervention of Right. Upon timely application anyone shall

be permitted to intervene in an action: (1) when a statute of the

United States confers an unconditional right to intervene; or (2)

when the applicant claims an interest relating to the property or

transaction which is the subject of the action and he is so situated

that the disposition of the action may as a practical matter impair

or impede his ability to protect that interest, unless the applicant's

interest is adequately represented by existing parties.

(b) Permissive Intervention. Upon timely application anyone

may be permitted to intervene in an action: (2) when a statute of

the United States confers a conditional right to intervene; or (2)

when an applicant’s claim or defense and the main action have a

question of law or fact in common. When a party to an action

30a

Opinion of the Court of Appeals, August 18, 1975

two categories of intervention: section (a) establishes the

procedures for timely intervention as of right, whereas

section (b) recognizes discretion in the district court to

permit intervention in two specified situations, again upon

timely application.

Besides timeliness, Rule 24 details other preconditions

to intervention. Under section (a), intervention as of right

is authorized (1) when an act of Congress confers an un-

conditional right to intervene, or (2) when the applicant

claims an interest in the subject matter of the action and

shows that the action’s disposition may, as a practical

matter, impair or impede the ability to protect that interest,

unless the applicant’s interest is adequately protected by

other parties to the suit. Thus, (a)(1) intervention pre-

supposes reliance on a statute. By contrast, the inquiry

under subsection (a)(2) is a flexible one, which focuses on

relies for ground of claim or defense upon any statute or executive

order administered by a federal or state governmental officer or

agency or upon any regulation, order, requirement, or agreement

issued or made pursuant to the state or executive order, the officer

or agency upon timely application may be permitted to intervene

in the action. In exercising its discretion the court shall consider

whether the intervention will unduly delay or prejudice the ad-

judication of the rights of the original parties.

(ce) Procedure. A person desiring to intervene shall serve a

motion to intervene upon the parties as provided in Rule 5. The

motion shall state the grounds therefor and shall be accompanied

by a pleading setting forth the claim or defense for which inter-

vention is sought. The same procedure shall be followed when a

statute of the United States gives a right to intervene. When the

constitutionality of an act of Congress affecting the public interest

is drawn in question in any action to which the United States or

an officer, agency, or employee thereof is not a party, the court

shall notify the Attorney General of the United States as provided

in Title 28, U.S.C. § 2403.

As amended Dec. 27, 1946, eff. March 19, 1948; Dee. 29, 1948,

eff. Oct. 20, 1949; Jan. 21, 1963, eff. July 1, 1963; Feb. 28, 1966,

eff. July 1, 1966.

3la

Opinion of the Court of Appeals, August 18, 1975

the particular facts and circumstances surrounding each

application. Since 1966, we have consistently held that

(a)(2) intervention as of right must be measured by a

practical rather than technical yardstick. E. g., Martin v.

Travelers Indem, Co., 5 Cir. 1971, 450 F.2d 542, 554; Diaz

v. Southern Drilling Corp., 5 Cir. 1970, 427 F.2d 1118,

1123-25, cert. denied sub nom., Trefina A.G. v. United

States, 400 U.S. 878, 91 S.Ct. 118, 27 L.Ed.2d 115 (1970) ;

Atlantis Development Corp. v. United States, 5 Cir. 1967,

379 F.2d 818, 822-29. A denial of an application for inter-

vention by right which was timely filed, as here, is subject

to the usual scope of our appellate review over questions

of law. An erroneous denial will be reversed. Weiser v.

White, 5 Cir. 1975, 505 F.2d 912, at p. 916. On the other

hand, if the appellate court finds that the claim of right to

intervene was without merit, then it must dismiss the appeal

for want of judisdiction, since the order denying interven-

tion does not constitute a final judgment. Id. See also C.

Wright, Federal Courts § 75, at 332 (1970).

The rules pertaining to permissive intervention are

slightly different. Rule 24(b) authorizes permissive inter-

vention (1) when a federal statute confers a conditional

right to intervene, or (2) when the application raises a

question of law or fact which is material to the main action.

In exercising its discretion, the district court is required

to consider whether permissive intervention would unduly

jeopardize or delay the determination of the original suit.

On appeal, the denial of a motion for permissive interven-

tion is unreviewable, unless the trial court abused its dis-

cretion. Brotherhood of R. R. Trainmen v. Baltimore &

Ohio R. R., 331 U.S. 519, 524, 67 S.Ct. 1387, 1390, 91 L.Ed.

1646, 1650 (1947) ; Martin v. Kalvar Corp., 5 Cir. 1969, 411

F.2d 552. If no abuse of discretion is demonstrated, then

32a

Opinion of the Court of Appeals, August 18, 1975

once again the district court’s order is not appealable and

we must dismiss the appeal for want of a final order.

Weiser v. White, supra; C. Wright, supra.

NOW’s principal contention asserts an absolute, uncon-

ditional right of intervention in favor of the organization.

NOW thus seeks to enter the lawsuit under Rule 24(a)(1).

NOW argues that this absolute, unconditional right is con-

ferred upon it by § 706(f)(1) of Title VII, as amended,

Puw.L.No.92-261, § 4(a) (Mareh 24, 1972), 42 U.S.C. § 2000e-

5(f)‘1). Section 706(f)(1), which, as pertinent, contains

the procedures for filing charges with the EEOC and the

filing of lawsuits by the Commission or charging parties

when conciliation fails, confers upon the “person or persons

aggrieved” a right to intervene in a civil action brought

thereunder by the Commission. NOW contends that since

it is a civil rights-oriented feminist organization which has

been permitted on occasions to file charges with the EEOC

on behalf of women, and since on at least one occasion

it has been made as a party-plaintiff in a sex disecrimina-

tion lawsuit,’® it should therefore be deemed a “person

aggrieved” in its own stead. NOW argues that judicial

recogition of an unconditional organizational right of inter-

vention would yield socially desirable results, since the

organization would receive valuable stature and publicity

1® NOW informs us that it is one of the plaintiffs in a class action

employment discrimination suit pending before the federal district

court in Maryland, styled Baltimore Chapter of NOW; Cathleen

J. Beasley and Catherine N. Lloyd v. Bethlehem Steel Corp., et al.,

No. M—74—377. Brief for Appellants NOW, et al., at 6. NOW

asserts that its filing of charges with the EEOC, for example on

behalf of all female employees of United States Steel at Gary,

Indiana (Charge No. TCH 4—1985, filed March, 1974), has been

instrumental in generating a favorable climate for conciliation and

settlement in the steel industry.

33a

Opinion f ‘te Court of Appeals, August 18, 1975

which would encourage female workers throughout the

nation to seek its assistance.

Without drawing any finer distinctions, the district court

held that NOW is not a “person aggrieved” within the

meaning of § 706(f)(1). In the court’s view, NOW did

not demonstrate a sufficiently concrete interest qua orga-

nization to justify the additional problems of management

and inconvenience to other parties (including, presumably,

the beneficiary employees of the consent decrees) that

might result from duplicative intervention. The fact that

NOW previously had been permitted to designate three

female intervenors, whom its counsel ably represented,

weighted heavily in Judge Pointer’s calculus. See 63 F.R.D.

at 4.

While perhaps a court might be persuaded by Judge

Pointer’s conclusion that NOW is not a “person aggrieved”

within the meaning of § 706(f)(1),’* we defer decision of

that question in favor of an approach which we consider

16 Cf. Sierra Club v. Morton, 405 U.S. 727, 740, 92 S.Ct. 1361,

1368-69, 31 L.Ed.2d 636, 646 (1972) :

The requirement that a party seeking review must allege

facts showing that he is himself adversely affected does not

insulate executive action from judicial review, nor does it

prevent any public interests from being protected through the

judicial process. It does serve as at least a rough attempt to

put the decision as to whether review will be sought in the

hands of those who have a direct stake in the outcome. That

goal would be undermined were we to construe the APA to

authorize judicial review ait the behest of organizations or

individuals who seek to do no more than vindicate their own

value preferences through the judicial process. The principle

that the Sierra Club would have us establish in this case would

do just that.

(footnotes omitted.)

But see Warth v. Seldin, —— USS. . , 95 S.Ct. 2197,

2211, 44 L.Ed. (1975) :

There is no question that an association may have standing

in its own right to seek judicial relief from injury te itself

34a

Opinion of the Court of Appeals, August 18, 1975

more directly dispositive. We hold that this was not a

proper case for intervention as of right by any private

party or organization pursuant to Rule 24(a)(1). Specif-

ically, we hold that intervention as of right was not con-

ferred in this proceeding by any act of Congress. We do so

because it is plain from a careful examination of the

government’s complaint that this was not in substance a

§ 706 action, but rather a “pattern or practice” action au-

thorized by § 707, 42 U.S.C. § 2000e-6, which the EEOC

was empowered to institute by virtue of the transfer of

functions outlined in §707(c).’’ Insofar as the United

States and the Secretary of Labor joined as plaintiffs to

enforce the obligations imposed on the defendants by Ex-

ecutive Order 11246, the district court’s jurisdiction was

hased on 28 U.S.C. § 1345."

and to vindicate whatever rights and immunities the associa-

tion itself may enjoy. Moreover, in attempting to secure relief

from injury to itself the association may assert the rights of

its members, at least so long as the challenged infractions

adversely affect its members’ associational ties.

In Warth the Court described the question of standing as essen-

tially a matter of “whether the constitutional or statutory provision

on which the claim rests properly can be understood as granting

persons in the plaintiff's position a right to judicial relief.” ——

U.S. at , 95 S.Ct. at 2207 (footnote omitted). Note that whereas

§ 706(f) (1) of Title VII creates civil actions and rights of inter-

vention in favor of “Person[s] aggrieved,” § 703, 42 U.S.C. § 2000e-

2, makes it unlawful to discriminate against “any individual.”

(emphasis added).

17 As of March 24, 1974, the EEOC assumed the full range of

“pattern or practice” functions which had belonged to the Justice

Department since the effective date of Title VII, July 2, 1965.

Accordingly, NOW appears to accept as correct our statement in

the text, that this was a § 707 “pattern or practice” action. Brief

for Appellants NOW, et al., at 6.

1698 U.S.C. § 1345: “Except as otherwise provided by Act of

Congress, the district courts shall have original jurisdiction of all

35a

Opinion of the Court of Appeals, August 18, 1975

Nothing in § 707 or in any other federal statute con-

ferred an unconditional right of intervention upon any

private individual or association thereof. The “pattern or

practice” action under § 707, which is conspicuously silent

in regard to intervention, must be carefully contrasted

with the actions contemplated by § 706. Under § 707, the

EEOC (formerly the Attorney General) may institute a

“pattern or practice” suit anytime that it has “reasonable

cause” to believe such a suit necessary. See United States

v. Jacksonville Terminal Co., 5 Cir. 1971, 451 F.2d 418,

438, cert. denied, 406 U.S. 906, 92 S.Ct. 1607, 31 L.Ed.2d

815 (1972). Section 707 does not make it mandatory that

anyone file a charge against the employer or follow ad-

ministrative timetables before the suit may be brought.

It was unquestionably the design of Congress in the enact-

ment of § 707 to provide the government with a swift and

effective weapon to vindicate the broad public interest in

eliminating unlawful practices, at a level which may or

may not address the grievances of particular individuals.

See Rodriguez vy. East Texas Motor Freight, 5 Cir. 1974,

505 F.2d 40, at p. 66; United States v. International Ass’n.

of Bridge, Structural, and Ornamental Iron Workers, 7

Cir. 1971, 438 F.2d 679, cert. denied 404 U.S. 830, 92 S.Ct.

75, 30 L.Ed.2d 60 (1971). Rather, it is to those individual

grievances that Congress addressed § 706, with its atten-

dant requirements that charges be filed, investigations con-

ducted, and an opportunity to conciliate afforded the re-

spondent when “reasonable cause” has been found. On the

civil actions, suits or proceedings commenced by the United States,

or by any agency or officer thereof expressly authorized to sue by

Act of Congress.” See United States v. Local 189, United Paper-

makers, E.D.La.1968, 282 F.Supp. 39, 43, aff'd, 5 Cir. 1969, 416

F.2d 980, cert. denied, 397 U.S. 919, 90 S.Ct. 926, 25 L.Ed.2d 100

(1970).

36a

Opinion of the Court of Appeals, August 18, 1975

other hand, the mere fact that some charges were filed, or

that efforts were made toward conciliation, does not in our

view transform what the government may properly bring

and does bring as a § 707 “pattern or practice” action into

a § 706 action. See United States v. Lronworkers Local 86,

9 Cir. 1971, 443 F.2d 544, 551-52, cert. denied, 404 U.S. 984,

92 §.Ct. 447, 30 L.Ed.2d 367 (1971).

We have studied closely the language of the two sections

in reaching the foregoing conclusions. If only the words of

the statute were available, one might plausibly argue that

§ 707(e), 42 U.S.C. § 2000e-6(e), incorporates § 706(f) (1)

intervention as of right into “pattern or practice” proce-

dure. Section 707(e), enacted as another of the 1972 amend-

ments to Title VII, provides that the EEOC shall have the

authority, subsequent to March 24, 1972, “to investigate

and act on” charges of pattern or practice discrimination

filed in behalf of aggrieved individuals. Section 707(e)

concludes: “All such actions shall be conducted in ac-

cordance with the procedures set forth in section 2000e-5

[§ 706] of this title.”

Arguably, these procedures include intervention as of

right by aggrieved parties. The legislative history indicates

otherwise, however, and in the absence of an express provi-

sion for intervention we choose to follow its signals. In

the first place, we have discovered no legislative history

evincing a favorable congressional attitude toward uncon-

ditional private intervention in government “pattern or

practice” litigation. In the legislative history which speaks

most closely to the point, the Hlouse Committee on Educa-

tion and Labor described the enacted precursor to § 707(e)

as a measure which merely “[a]ssimilate[d] procedures for

new proceedings brought under Section 707 to those now

provided for under Section 706 so that the Commission

37a

Opinion of the Court of Appeals, August 18, 1975

may provide an administrative procedure to be the counter-

part of the present Section 707 action.” (emphasis added)."*

Thus, while Congress apparently intended that the EEOC

have investigative and conciliatory authority in “pattern or

practice” situations comparable to its existing powers in

§ 706 cases, there is no indication that Congress intended

the duplication of procedures to extend beyond the admin-

istrative level. The EEOC, of course, may not enact stat-

utes, and it is a statute that Rule 24(a)(1) requires.

We emphasize that our disposition of the 24(a)(1) as-

pect of the intervention question is based primarily on

what we find to be the correct construction of § 707 and its

legislative history. We are comforted, however, by the Sev-

enth Cirenit’s recent decision in EEOC vy. United Air Lines,

7 Cir. 1975, 515 F.2d 946, in which the court reached the

same conclusion, though ultimately its affirmance was based

on the untimeliness of the intervenors’ application. Also,

we find persuasive support for our refusal to effectively

imply an unconditional statutory right in the strong judicial

policy against nonexpress private intervention in govern-

ment enforcement litigation when an adequate private rem-

edy is freely accessible. See, ce. g., Sam Fox Publishing

Co. v. United States, 366 U.S. 683, 81 S.Ct. 1309, 6 L.Eid.2d

604 (1961). See also Battle v. Liberty Nat’l. Life Ins. Co.,

5 Cir. 1974, 493 F.2d 39, 52, cert. denied, 419 U.S. 1110, 95

S.Ct. 784, 42 L.Ed.2d 807 (1975). This policy likewise ap-

plies to applications for intervention by right under Rule

24(a)(2), and applications for permissive intervention un-

der Rule 24(b). See SEC v. Everest Mgt. Corp., 2 Cir.

1972, 475 F.2d 1236; United States v. Automobile Mfrs.

'? H. Rep. No. 92-238, reporting H.R. 1746, 92d Cong., 2d Sess.,

1972 U.S.Code Cong. & Admin.News 2137, at 2164 (reporting

§ 707(f) of H.R. 1746).

38a

Opinion of the Court of Appeals, August 18, 1975

Assn., C.D.Cal.1969, 307 F.Supp. 617, 619, aff'd per curiam,

397 US. 248, 90 S.Ct. 1105, 25 L.Md2d 280 (1970). Cf.

NAACP v. New York, 415 U.S, 945, 368, 93 S.Ct. 2591, 2604,

37 L.Kid.2d 648, 664 (1973).

Without any aim on our part to denigrate whatever so-

cial benefit may accrue from participation in the proceed-

ings by organizations such as NOW, or to impose NOW’s

motives or sincerity, we note that NOW has offered no

commanding legal or policy arguments to warrant a rule

allowing its intervention as of right. NOW places much

reliance on EKOC vy. American Tel, & Tel. Co., B.D.Pa.1973,

i655 F.Supp. 1105, aff'd in part, appeals dismissed im part,

3 Cir, 1974, 506 F.2d 735. There the court granted interven-

iion by right, under © 706(f)(1) and Rule 24(a)(1), to a

labor union insofar as certain issues raised in the union's

application related to grievances with respect to whieh

charges had been filed with the KEOC, and to remedy

which the Commission had filed a suit that led to an in-

dustry wide consent decree, American Tel. & Tel., however,

was a suit brought by the Commission pursuant to 4 706.

It was not a 4707 “pattern or practice” action. See 506

F.2d at 740. The issue before the court was whether the

union could be considered an “aggrieved” party for pur-

poses of 4 706(f)(1). The ease is not authority for the

proposition sought to be established sub judice. At any

rate, we think that a labor union which is party to the col-

lective bargaining agreement presents a far stronger case

for intervention than does an organization such as NOW,

provided that confliets of interest are minimized.”

"A labor union is elected to represent in collective bargaining

the employees who depend on the eompany for their jobs and

livelihood, When the company, as in American Tel. & Tel, enters

into a settlement with the government in an effort to resolve eom-

39a

Opinion of the Court of Appeals, August 18, 1975

In summary, we have determined that NOW enjoyed

no unconditional statutory right to intervene under F.R.

Civ.P. 24(a)(1). The matter is mostly ended at this point,

but we pause briefly to consider whether the district court

could have erred in refusing to grant NOW intervention

under Rule 24(a)(2) or (b). With respect to (a)(2) inter-

vention as of right, NOW obviously claims an interest in

the subject matter of the action. We believe, however, that

NOW fails the other two prongs of the test. NOW has not

shown that the district court’s decision to enter the consent

decrees as between the government and the defendants may,

as a practical matter, operate to impair or impede the pro-

tection of its interest. Neither NOW nor any of its mem-

bers is bound by res judicata or estopped to the consent

decrees. See Rodriguez v. Kast Texas Motor Freight, 5

Cir. 1974, 505 F.2d 40 at p. 65; Williamson v. Bethlehem

Steel Corp., 2 Cir. 1972, 468 F.2d 1201, 1203, cert. denied,

plaints of alleged employment discrimination, the union deriva-

tively acquires a mandatery duty to negotiate alternatives to the

provisions—e.g., those relating to seniority, or as in the Bell case

pregnancy leave—of the existing collective bargaining contract. If

the settlement contains features the legality or propriety of which

is questionable, then the union may have a definite, cognizable

interest qua union in contesting those features. Cf. Kilberg, Cur-

rent Cimil Rights Problems in the Collective Bargaining Process:

The Bethichem and AT&T Experiences, 27 Vand.1.Rev. 81, 101,

106 (1974). Furthermore, the union’s ability to protect its interest

may well be impaired or impeded if it is not allowed to intervene

in the settlement formalization proceedings. Id. At the very least,

it would be anomalous to assume in such cases that the employees’

bargaining representative's interest is adequately served by the

government or the employer. Nevertheless, the union must eare-

fully tailor its role in intervention in order not to unduly favor

or discriminate against the interests of particular segments of its

membership, See EEOC v. American Tel. & Tel. Co., 3 Cir. 1974,

06 F.2d 735, 741.

40a

Opinion of the Court of Appeals, August 18, 1975

411 U.S. 931, 93 S.Ct. 1893, 36 L.Ed.2d 390 (1973). See also

Sam Fox Publishing Co. v. United States, supra, 366 U.S.

at 689-90, 81 S.Ct. at 1313, 6 L.Ed.2d at 609. Furthermore,

the district court explicitly qualified the denial of interven-

tion as a denial without prejudice to future intervention.

Cf. NAACP v. New York, supra. Finally, plenary legal

remedies remain fully available to NOW’s membership and

perhaps, or so NOW has asserted, to the organization it-

self." The policy against private intervention in govern-

21 For that reason, NOW’s reliance on eases such as Trbovich v.

UMW, 404 U.S. 528, 92 S.Ct. 630, 30 L.Ed.2d 686 (1972), is mis-

placed. Trbovich was an action by the Secretary of Labor under

§ 482(b) of the LMRDA, 29 U.S.C. § 401 et seq., to set aside a

union’s election of officers because of alleged violations of Title IV

of the Act, § 481 et seq. The statute provided that the suit by the

Secretary constituted the exclusive remedy, and union members

are barred by law from bringing private actions. Since the Secre-

tary thus functioned as the union members’ only advocate for the

protection of their valuable rights against the union, and because

of the Secretary’s corresponding and potentially conflicting duty

to consider the broader public interest, the Court held that the

union member who filed the original complaint with the Secretary

was entitled to limited intervention under Rule 24(a)(2). Here,

by contrast, although the government was obliged to represent the

publie interest, the consent decrees do not purport to affect the

availability of relief from employment discrimination through pri-

vate actions under Title VII, the Civil Rights Act of 1866 (42

U.S.C. § 1981), the labor law duty of fair representation, or any

other applicable federal law. Compare Hodgson v. UMW, 1972,

153 U.S. App.D.C, 407, 473 F.2d 118, 122 n. 15, 128-30 (suit by

Secretary under Title ITI of LMRDA is res judicata as against

union members; Rule 24(a)(2) intervention allowed).

Also to be distinguished are cases such as Atlantis Development

Corp. v. United States, 5 Cir. 1967, 379 F.2d 818 (title to prop-

erty); Martin v. Travelers Indem. Co., 5 Cir, 1971, 450 F.2d 542

(liability insurance coverage); and Nuesse v. Camp, 1967, 128

U.S.App.D.C. 172, 385 F.2d 694 (conflict between federal banking

laws and state law), in which courts have granted (a)(2) inter-

vention because of the practical disadvantages that would follow

from peculiar stare dé cisis effects, if intervention were not allowed.

Again contrasting this ease, we have difficulty conceiving of how

the consent decrees—products of negotiation rather than contested

4la

Opinion of the Court of Appeals, August 18, 1975

ment litigation, noted supra, militates against the allowance

of (a)(2) intervention here; NOW makes no colorable

showing of inadequacy in the government’s representation

of the public interest. In any event, NOW fails the third

element of the (a)(2) test. Having participated through

its nominees and counsel during these entire proceedings,

NOW cannot be heard to complain of the adequacy of the

feminist representation.

Insofar as NOW’s application may be deemed to have

sought permissive intervention under Rule 24(b), no abuse

of discretion has been shown in the denial. The district

court was clearly justified in determining that the interests

of the majority of the effected individuals predominated

over NOW’s interest in further delaying implementation

of the decrees’ reforms. Such determinations must be

viewed in light of the circumstances as they existed at the

time. EEOC v. United Air Lines, supra, 515 F.2d at 949.

In this case, a full hearing had been held and NOW had

received ample opportunity to present its arguments. The

court below did not err in denying further intervention.

litigation—are likely to carry stare decisis effects measurably ad-

verse to NOW or its membership in any future proceeding. A

careful analysis of the deerees demonstrates that such an assump-

tion would be not only quite premature, but also naively critical

of the perceptive abilities of the judiciary. See Judge Motley’s

lucid diseussion in Leisner v. New York Tel. Co., S.D.N.Y.1973,

358 F.Supp. 359, 369-70. Cf. Pettway v. American Cast Iron Pipe

Co., 5 Cir. 1974, 494 F.2d 211, 221 n. 21; Rodriguez v. East Texas

Motor Freight, 5 Cir. 1974, 505 F.2d 40, at p. 65; Dickerson vy.

United States Steel Corp., E.D.Pa. 1974, 64 F.R.D. 351.

In no respect does this case bear genuine resemblance to the kind

of bizarre problems encountered in Caseade Natural Gas Corp. v.

El Paso Natura! Ges Co., 386 U.S. 129, 87 S.Ct. 932, 17 L.Ed2da

814 (1967). See Kaplan, Continuing Work of the Civil Committee:

[ete.} (7), 81 Harv.L.Rev. 356, 405-06 (1967).

42a

Opinion of the Court of Appeals, August 18, 1975

Consequently, NOW’s appeal qua organization must be

dismissed.”

Ill. Tue Appeats on THE Merits: CHALLENGES

To THE ConsENT DecrEES

A. Scope of Review

Before proceeding with our examination of the appel-

lants’ numerous and provocative challenges to the consent

decrees, it is appropriate that we outline the rules of law

which govern the parameters of our review. Initially, it

cannot be gainsaid that conciliation and voluntary settle-

ment are the preferred means for resolving employment

discrimination disputes. As early as 1968, Judge Bell wrote

for this court: “It is thus clear that there is great em-

phasis in Title VII on private settlement and the elimina-

tion of unfair practices without litigation.” Oatis v. Crown

Zellerbach Corp., 5 Cir. 1968, 398 F.2d 496, 498 (emphasis

added). Subsequently, in Dent v. St. Louis-San Francisco

Ry. Co., 5 Cir. 1969, 406 F.2d 399, 402, Judge Coleman

advanced the same thesis:

Thus it is quite apparent that the basie philosophy

of these statutory provisions is that voluntary compli-

22 Although we have determined that intervention as of right

under F.R.Civ.P. 24(a)(1) was not available to the private parties

and groups who sought intervention in this case, some of whose

applications were granted below on the assumption that § 706(f)

(1) of Title VII conferred such right, we proceed nonetheless to

consider the merits of the attacks lodged against the consent de-

erees by the remaining intervenors-appellants. We do so on the

assumption that the district court, having concluded that certain

parties ought to be granted intervention either by right or by

permission, would have allowed those parties to intervene in any

event under either 24(a)(2) or (b). No appellee has suggested

by way of cross-assignment or otherwise that we should not go

forward to the merits.

43a

Opinion of the Court of Appeals, August 18, 1975

ance is preferable to court action and that efforts

should be made to resolve these employment rights by

conciliation both before and after court action.

(emphasis added). In Culpepper v. Reynolds Metals Co.,

5 Cir. 1970, 421 F.2d 888, 891, we declared that “the cen-

tral theme of Title VII is ‘private settlement’ as an effec-

tive end to employment discrimination,” citing Oatis. Next,

in Hutchings v. United States Industries, Inc., 5 Cir. 1970,

428 F.2d 303, 309, Judge Ainsworth stated:

[I]t is clear that Congress placed great emphasis upon

private settlement and the elimination of unfair prac-

tices without litigation (citing Oatis) on the ground

that voluntary compliance is preferable to court action.

(citing Dent). Indeed, it is apparent that the primary

role of the EEOC is to seek elimination of unlawful

employment practices by informal means leading to

voluntary compliance,

(emphasis added).”

Our recent excursions into this area have not detoured

from the foregoing principles, but have emphasized instead

their practical value. In the most sweeping of all our em-

ployment discrimination decisions, Pettway v. American

Cast Iron Pipe Co., 5 Cir. 1974, 494 F.2d 211, 258, we said

in regard to the firmly established, but nonetheless thorny

and speculative matter of awarding ciasswide back pay:

*8 Accord, Guerra v. Manchester Terminal Corp., 5 Cir. 1974,

498 F.2d 641, 650; Airline Stewards and Stewardesses v. Ameri-

ean Airlines, Ine., 7 Cir. 1972, 455 F.2d 101, 109; Fekete v. United

States Steel Corp., 3 Cir. 1970, 424 F.2d 331, 336; Bowe v.

Colgate-Palmolive Co., 7 Cir. 1969, 416 F.2d 711; Jenkins v.

United Gas Corp., 5 Cir. 1968, 400 F.2d 28.

44a

Opinion of the Court of Appeals, August 18, 1975

Initially, we approve the district court’s intention of

referring the back pay claims to a Special Master, Fed.

R.Civ.P. 53. United States v. Wood, Wire & Metal

Lathers Int. Union, Local 46, 328 F.Supp. 429, 441

(S.D.N.Y. 1971). However, the court and the parties

may also consider negotiating an agreement. E. g.,

Johnson v. Goodyear Tire & Rubber Co., 349 F.Supp.

3, 18 (S.D. Tex. 1972), 491 F.2d 1364 (5th Cir. March

27, 1974); United States v. Wood, Wire & Metal

Lathers, Int. Union, Local 46, supra 328 F.Supp. at

444 n. 3. An alternative is to utilize the expertise of

the intervening Equal Employment Opportunity Com-

mission to supervise settlement negotiations or to aid

in determining the amount of the ward.

(emphasis added).

Nor has the Supreme Court maintained detached silence |

in regard to the deference courts should accord the pro- |

cesses of voluntary conciliation and settlement. Describing

Title VII and the functions of the EEOC, Mr. Justice

Powell in Alexander v. Gardner-Denver Co., 415 U.S. 36, —

44, 94 S.Ct. 1011, 1017-18, 39 L.Ed.2d 147, 156 (1974), wrote

for the Court:

Cooperation and voluntary compliance were selected

as the preferred means for achieving [the elimination

of unlawful employment discrimination]. To this end,

Congress created the Equal Employment Opportunity

Commission and established a procedure whereby State

and local equal employment opportunity agencies, as

well as the Commission, would have an opportunity

to settle disputes through conference, conciliation, and

persuasion before the aggrieved party was permitted

to file a lawsuit. In the Equal Employment Oppor-

45a

Opinion of the Court of Appeals, August 18, 1975

tunity Act of 1972, Pub.L. 92-261, 86 Stat. 103, Con-

gress amended Title VII to provide the Commission

with further authority to investigate individual charges

of discrimination, to promote voluntary compliance

with the requirements of Title VII, and to institute

civil actions against employers or unions named in a

discrimination charge.

(emphasis added). In Gardner-Denver the Supreme Court

stressed the importance of voluntary settlement in voicing

its disapproval of a policy of deferral to binding arbitra-

tion. In the Court’s view, such a policy could adversely

affect the arbitration system as well as the vindication of

individual rights, since the employee—fearful of the arbi-

tral forum—might elect to bypass arbitration and file a

lawsuit instead. “The possibility of voluntary compliance

or settlement of Title VII claims would thus be reduced,

and the result could well be more litigation, not less.” 415

U.S. at 59, 94 S.Ct. at 1025, 39 L.Ed.2d at 164. (emphasis

added).

So far, we have emphasized only one side of the coin—

the side which places a premium on the achievement of

voluntary compliance. In doing so, we have not overlooked

that the “final responsibility for enforcement of Title VII

is vested with federal courts,” Gardner-Denver, supra, 415

U.S. at 44, 94 S.Ct. at 1018, 39 L.Ed.2d at 156, and that

“Congress gave private individuals a significant role in

the enforcement process of Title VII.” Jd. See also Me-

Donnell Douglas Corp. v. Green, 411 U.S. 792, 93 S.Ct.

1817, 36 L.Ed.2d 668 (1973); Griggs v. Duke Power Co.,

401 U.S. 424, 91 S.Ct. 849, 28 L.Ed.2d 158 (1971).** Nor

** Statements to the same effect may be found in virtually all of

the cases which we have canvassed in stressing the importance of

46.

Opinion of the Court of Appeals, August 18, 1975

have we forgotten that “the private right of action remains

an essential means of obtaining judicial enforcement of

Title VIL” Gardner-Denver, supra, 415 U.S. at 45, 94 S.Ct.

at 1018, 39 L.Ed.2d at 156 (emphasis added), and cases

cited. We are fully mindful, moreover, that the EEOC’s

limited resources permit it to undertake serious conciliation

or lawsuits in only a small fraction of the cases on its

docket.** For that reason, the congressional scheme con-

tinues to depend in substantial measure upon “private at-

torneys general” who, through their lawsuits in the federal

courts, elicit enunciation of the great bulk of policies and

principles which serve to flesh out the basie congressional

mandate.

Yet we deal here with one of those rare instances in

which the government has, to its satisfaction, successfully

negotiated a comprehensive voluntary accord. At least os-

conciliation and settlement, and in legion others as well. See, e.q.,

Gamble v. Birmingham Southern R. R., 5 Cir. 1975, 514 F.2d 678,

at p. 686. To repeat the citations would be superfluous in view of

the Supreme Court's repeated and emphatic recognition of the

important enforcement role played by private suitors.

7° According to one fairly recent source, the EEOC—to no one’s

surprise—“suffers from a considerable work backlog.” It is re-

ported that as of June 30, 1971, some 32,000 cases were backlogged,

and that the processing of a charge may consume eighteen to

twenty-four months. Further, after the EEOC finds reasonable

cause, another six months usually passes before it seeks conciliation.

In fiseal 1972, the last year prior to implementation of the 1972

amendments which gave the EEOC power to sue, the Commission

found reasonable cause to assert unlawful discrimination against

only 1,390 empl yers. Settlement was attempted to some degree

with 792 of these employers, but only 268 attempts resulted in a

partial or complete success. Note, The Tentative Settlement Class

and Class Action Suits Under Title VII of the Civil Rights Act,

72 Mich.L.Rev. 1462, 1463 n. 11, 1464 n. 17 (1974).

Another source reports that as of the close of fiscal 1974, the

EEOC’s backlog had grown to nearly 98,000 charges. 181 BNA—

DLR—D-1, 5 (Sept. 17, 1974).

47a

Opinion of the Court of Appeals, August 18, 1975

tensibly, the government has done precisely what it ought

to do as a matter of public policy in order to vitiate the

need for additional industry-wide litigation. On the other

hand, the product of the considerable efforts on behalf of

the government, the steel companies, and the union does

not purport to foreclose any alternatives that may other-

wise exist for individuals who had rather litigate than par-

ticipate in the entire settlement.** We say entire because

26In this respect, the consent decrees present a situation some-

what analcgous to that recently examined by the Supreme Court

in Johnson yv. Railway Express Agency, Inc., US. , 95

S.Ct. 1716, 44 L.Ed.2d 295 (1975). In Johnson it was argued that

the timely filing of an employment discrimination charge with the

EEOC, pursuant to Title VII, should be held to toll the applicable

state statute of limitations for a suit under 42 U.S.C. § 1981 on

the same cause of action. Rejecting the argument, the Supreme

Court reiterated the theme of Gardner-Denver that the various

legal remedies for employment discrimination are cumulative and

complementary. From the grievant's standpoint, “{u]nder some

circumstances, the administrative route may be highly preferred

over the litigatory; under others the reverse may be true.”

U.S. at ——, 95 S.Ct. at 1720, 44 L.Ed.2d at 302.

The most significant feature about Johnson is its emphasis on

the principle that the choice over which way to proceed belongs to

the grievant:

Petitioner argues that a failure to toll the limitation period

in this case will conflict seriously with the broad remedial and

humane purposes of Title VII. Specifically, he urges that

Title VII embodies a strong federal policy in support of con-

ciliation and voluntary compliance as a means of achieving

the statutory mandate of equal employment opportunity. He

suggests that failure to toll the statute on a § 198! claim dur-

ing the pendency of an administrative complaint in the EEOC

would force a plaintiff into premature and expensive litiga-

tion that would destroy all chances for admnistrative concilia-

tion and voluntary compliance.

We have noted this possibility and, indeed, it is conceivable,

and perhaps almost to be expected, that failure to toll will

have the effect of pressing a civil rights complainant who

values his § 1981 claim into court before the EEOC has com-

pleted its administrative proceeding. (footnote omitted). * * *

48a

Opinion of the Court of Appeals, August 18, 1975

the injunctive relief provided by the consent decrees ex-

tends to all affected steelworkers, regardless whether they

elect to accept the back pay and execute the releases. The

question at this point, then, is through what lens do we

judge the adequacy of the settlement as against the inter-

venors’ objections, bearing in mind that Congress and the

Supreme Court have expressed a preference for voluntary

compliance above all other tools of enforcement?

We think the answer was delivered nearly fifteen years

ago by Judge (now Chief Judge) Brown in Florida Trailer

and Equipment Co. v. Deal, 5 Cir. 1960, 284 F.2d 567, in

which an objecting creditor sought to void a referee and

district court-approved settlement, reached pursuant to the

Bankruptcy Act, between the trustee of the insolvent estate

and a lien creditor. There we stated:

Of course, the approval of a proposed settlement does

not depend on establishing as a matter of legal cer-

tainty that the subject claim or counterclaim is or is

not worthless or valuable. The probable outcome in

But the fundamental answer to petitioner’s argument lies in

the faet—presumably a happy one for the civil rights claim-

ant—that Congress clearly has retained § 1981 as a remedy

against employment discrimination separate from and inde-

pendent of the more elaborate and time consuming procedures

of Title VII.

U.S. at , 95 S.Ct. at 1722, 44 L.Ed.2d at 304. Likewise

in this case, individual employees will find themselves faced with

the choice whether to timely accept back pay under the consent

decrees, for which no litigation will be necessary, or file private

charges and /or lawsuits and risk the usual litigatory uncertainties

in quests for greater recoveries. We know of no policy or rule of

law, however, which forbids the erection of such a choice when its

effect is to leave the individual grievant in a position no worse,

but in fact better, than that oceupied in the absence of the settle-

ment, which, of course, is not binding on the individual unless he

or she so desires.

49a

Opinion of the Court of Appeals, August 18, 1975

the event of litigation, the relative advantages and

disadvantages are, of course, relevant factors for eval-

uation. But the very uncertainty of outcome in litiga-

tion, as well as the avoidance of wasteful litigation

and expense, lay behind the Congressional infusion of

a power to compromise. This is a recognition of the

policy of the law generally to encourage settlements.

This could hardly be achieved if the test on hearing

for approval meant establishing success or failure to

a certainty. Parties would be hesitant to explore the

likelihood of settlement apprehensive as they would

be that the application for approval would necessarily

result in a judicial determination that there was no

escape from liability or no hope of recovery and hence

no basis for a compromise.

284 F.2d at 571. Judge Brown continued:

Obviously, it would not be a settlement if to obtain

approval the Trustee would have to demonstrate that

he could not succeed had the preference claim been

pressed. All that he must do is establish to the rea-

sonable satisfaction of the Referee that, all things con-

sidered, (citation omitted), it is prudent to eliminate

the risks of litigation to achieve specific certainty

though admittedly it might be considerably less (or

more) than were the case fought to the bitter end. * * *

Id. at 573 (emphasis added).

Despite the appearance of an occasional contextual

gloss,”” the approach to judicial evaluation of proposed set-

27 FE. g., West Virginia v. Chas. Pfizer & Co., S.D.N.Y.1970, 314

F.Supp. 710, 740, aff'd, 2 Cir. 1971, 440 F.2d 1079, cert. denied,

sub nom., Cotler Drugs, Inc. v. Chas. Pfizer & Co., 404 U.S. 871,

50a

Opinion of the Court of Appeals, August 18, 1975

tlements announced in Deal has drawn firm adherents

among the federal courts. See City of Detroit v. Grinnell

Corp., 2 Cir. 1974, 495 F.2d 448, 455-56 (objectors must

show clear abuse of discretion in trial court’s approval of

settlement); Bryan v. Pittsburgh Plate Glass Co., 3 Cir.

1974, 494 F.2d 799, 803, cert. denied, Abate v. Pittsburgh

Plate Glass Company, 419 U.S. 900, 95 S.Ct. 184, 42 L.Ed.2d

146 (1974) (settlement not unfair simply because many

class members oppose it); Greenspun v. Bogan, 1 Cir. 1974,

492 F.2d 375, 381 (only where one side is so clearly cor-

rect that offer in compromise becomes clearly unreasonable

does trial court abuse discretion in approving settlement) ;

Ace Heating & Plumbing Co., Ine. v. Crane Co., 3 Cir. 1971,

453 F.2d 30, 34 (great weight is accorded the trial judge’s

views); West Virginia v. Chas. Pfizer & Co., 2 Cir. 1971,

440 F.2d 1079, 1085-86, cer*. denied, see footnote 27, supra,

(appellate court will disturb settlement approval only upon

clear showing of abuse of discretion). See also Young v.

Katz, 5 Cir. 1971, 447 F.2d 431.

Applying the Deal approach to the issues before us, we |

align ourselves with certain propositions which were re-

cently developed by the Second Circuit in its review of a

similar, though less expansive, Title VII settlement, see

Patierson v. Newspaper and Mail Deliverers’ Union of New

York and Vicinity, 2 Cir. 1975, 514 F.2d 767. In the first

place, the scope of our review is narrow and we should

interfere with the implementation of the consent decrees

only upon a clear showing that the district judge abused

his discretion by approving the settlement. Next, to the

92 S.Ct. 81, 30 L.Ed.2d 115 (1971) (“fair, reasonable and ade-

quate”) ; “*eCray v. Beatty, D.N.J.1974, 64 F_R.D. 107, 110 (court

“would not approve a settlement that appeared inequitable or un-

fair to any party to the suit”). .

5la

Opinion of the Court of Appeals, August 18, 1975

extent that the settlement may in occasional respects ar-

guably fail short of immediately achieving for each affected

discriminatee his or her “rightful place,” we must balance

the affirmative action objectives of Title VII and Execu-

tive Order 11246 against the equally strong congressional

policy favoring voluntary compliance. The appropriate-

ness of such balancing is especially clear, as here, “in

an area where voluntary compliance by the parties

over an extended period will contribute significantly to-

ward ultimate achievement of statutory goals.” 514 F.2d

at 771. Nor should we substitute our notions of fairness

and adequacy of the relief for those of the parties and

Judge Pointer, absent a strong showing that the district

court failed to satisfy itself of the settlement’s overall fair-

ness to beneficiaries and consistency with the public in-

terest. Finally, and of utmost importance, we are without

authority to modify or rewrite the parties’ agreement. Our

only alternative, if it were shown that Judge Pointer abused

his discretion or overlooked an illegal provision, would be

to vacate his approval of the entire settlement and remand

for trial of the government’s “pattern or practice” com-

plaint. See United States v. Atlantic Ref. Co., 360 U.S. 19,

23, 79 S.Ct. 944, 946, 3 L.Ed.2d 1054, 1057 (1969); Patter-

son, supra, 514 F.2d at 772. Cf. United States v. Blue Chip

Stamp Co., C.D.Cal. 1967, 272 F.Supp. 432, 440, aff’d per

curiam sub nom., Thrifty Shoppers Scrip Co. v. United

States, 389 U.S. 580, 88 S.Ct. 693, 19 L.Ed.2d 781 (1968).

To the foregoing observations we add a few remarks

which we think are particularly pertinent to these appeals.

The central issue here is not whether the consent decrees

achieve some hypothetical standard constructed by imagin-

ing every benefit that might someday be obtained in con-

tested litigation. The question which we must decide is

whether the responsible government agencies may lawfully

52a

Opinion of the Court of Appeals, August 18, 1975

conciliate and settle by consent decree charges of diserim-

ination cutting across an entire industry in a manner which

assures cooperative defendants that they will not face fu-

ture government lawsuits on those claims, and which ac-

cords the defendants the opportunity to offer final satis-

faction to aggrieved individuals who are willing to accept

tenders of back pay and execute the releases. Throughout

their arguments, the appellants imply that private suits

by thousands of unspecified employees whose grievances

are generally covered by the decrees would be virtually

certain to achieve far better results thon those obtained by

the government. Yet this implication, stripped of its rhet-

orice, goes really ouly to back pay insofar as the Harris ap-

pellants have challenged seriously the adequacy of the de-

crees’ injunctive measures neither in the district court nor

in this court.** Only the three female appellants have done

7* The extremely dubious validity of the appellants’ implication

is highlighted by certain examples. Although Title VIT had been

in effect almost nine years at the time of the consent decrees’ entry,

private actions had been instituted at no more than a dozen of the

250 plants covered by the deerees. Of these private actions, only ©

one had proceeded to final judgment, the Fairfield Works case, sce

note 7, supra. In that case sweeping injunctive reforms were <r-

dered and implemented, but the district court denied back pay to

the overwhelming majority of aggrieved steelworkers. Whereas

the consent settlement extends offers of back pay to all production

and maintenance minority employees hired before 1968 and all

female employees hired before the date of the decrees, the back

pay awarded in the Fairfield case was limited to sixty-one blacks

hired before 1963.

Furthermore, the Fairfield order provided affirmative relief

only to blacks. The consent decrees provide such relief to females

and Spanish-surnamed Americans as weil. Consent Deeree IT, for

example, establishes as an interim affirmative goal that twenty

percent of all new hires in production and maintenance depart-

ments shall be females.

Also, the order in Fairfield provided for rate retention only to

blacks who transferred within three years of the date of the order.

53a

Opinion of the Court of Appeals, August 18, 1975

so, and their contentions—though they certainly suggest

possibilities—do not approach any stretch of certainty.

Against the overwhelmingly speculative advantage that

might acerue to a small number of aggrieved persons if

the decrees were vacated must be weighed the certain loss

to all of the immediate injunctive benefits and the unim-

peded opportunity to receive some back pay today—instead

of after months or years of litigation. Additional losses

which must be considered include the nation’s investment in

the resources consumed by the federal agencies in negotiat-

ing these decrees, as well as the chance justly to finalize a

matter that otherwise would burden agencies and courts and

continue to disrupt an industry vital to the nation’s security

for years to come. We proceed now to examine specific is-

sues raised by the appellants.

Consent Decree 1 creates a rate retention remedy which applies

to all female and minority employees with piant seniority as of

January 1, 1968, and who may wish to transfer at any time in the

future. The rate retention in Fairtield lasted for only one year

following transfer; the retention period under Consent Decree I

continues for up to two years.

Finally, the time factor alone is illuminating as it surfaces in

these cases. It seek six months to try the Fairfield suit. The re-

lief eventually ordered there is no more impressive than the re-

forms which were hammered out by the government, the steel

companies, and the union during six months of negotiations. If

we consider back pay, then the Fairfield relief per capita is far

less than under the deerees. The appellants here do not dispute

the steel companies’ estimate that if an equivalent amount of time

were used to litigate the issues at each of the 250 plants covered

by the-decrees, it would take at that rate ten years to try just the

liability issues. If after trial the back pay issues were referred

to a special master for individualized computations, after giving

consideration to various defenses, including lack of qualification,

voluntary freezing, refusal to bid, and physical fitness, and if on:

hour were allotted each of 60,000 claimants, over twenty-cigt t

years of trial time could be consumed. Brief for appellee steel com-

panies at 11 n. 14.

54a

Opinion of the Court of Appeals, August 18, 1975

B. Alleged Illegality of Back Pay Releases

The subject of back pay is treated in paragraph 18 of

Consent Decree I. The parties to the decree begin with the

understanding that disagreement exists over whether any

affected employee is entitled to back pay, and if so how

much. Paragraph 18 continues:

In final resolution of that dispute and in full compen-

sation for all alleged injuries suffered by such [ag-

grieved eligible employees] by reason of any unlawful

acts and practices within the scope of the complaint

or this Decree, as well as any future claim of dam-

ages by reason of the continuance of the effects of

such past discriminatory acts and practices, all of the

parties have agreed as follows:

(g) The amount of back pay determined to be due

to each affected employee*’ shall be tendered to him in

*® Subsection (e) of paragraph 18 sets forth the factors to be

considered by the Audit and Review Committee in identifying

eligible recipients and computing individual awards. Those em-

ployees who have been most adversely affected for the longest

periods are supposed to receive the highest sums. The average

award is approximately $500 ($30,940,000) divided by 60,000

black, Latin American, and female employees). Some employees

will receive more, others will receive less; but in no event will an

electing eligible employee, sec paragraph 18(c) of Consent Decree

I and footnote 4, supra, whose plant service antedates 1968 receive

less than $250. All females who were employed in a production

and maintenance unit as of the date of decree entry are eligible

for back pay. We were advised at oral argument that the indi-

vidual awards will represent pro rata shares across the member-

ships of particular soniority subclasses. Such a method designed

to equitably and efficiently distribute the gross recovery was ap-

proved in Pettway, supra, 494 F.2d at 263 n. 154. Obviously,

there is no single “correct” formula.

55a

Opinion of the Court of Appeals, August 18, 1975

accordance with procedures established by the Audit

and Review Committee. In order to receive such back

pay, each affected employee shall be required to execute

a release, in a form approved by the Audit and Review

Committee, of any claims against or liability of the

Company, the Union, their officers, directors, agents,

local unions, members, employees, successors and as-

signs, resulting from any alleged violations based on

race, color, sex (exclusive of the matters referred to

in paragraph D of this Decree), or national origin,

occurring on or before the date of entry of this Decree,

of any equal employment opportunity laws, ordinances,

regulations or orders, including but not limited to Title

VII of the Civil Rights Act of 1964, as amended, 42

U.S.C. § 2000e et seq., the Civil Rights Act of 1866,

42 U.S.C. § 1981 et seq., Executive Order 11246, as

amended, the United States Constitution, the duty of

fair representation under the Labor Management Re-

lations Act, 29 U.S.C. § 151 et seq., and any other ap-

plicable federal, state or local constitutional or stat-

utory provisions, orders or regulations. Such release

will also bar recovery of any damages suffered at any

time after the date of entry of this decree by reason

of continued effects of any such discriminatory acts

which occurred on or before the date of entry of this

Decree.*®

*° The provision for the release by electing employees of claims

against the defendants in exchange for back pay was patterned

after the release which was utilized with the Bell System consent

decree, ZEOC v. American Tel. & Tel., supra. See BNA FEP

Manual 431:73, at 431:77, 431:79 (parts A VIII.A; B II.B.).

Whereas the Bell release encompassed “any claims for alleged vio-

lations . . . based upon occurrences prior to” the date of decree

entry, Consent Decree I specifically provides for the release of

56a

Opinion of the Court of Appeals, August 18, 1975

All appellants attack the legality and efficacy of the

quoted provision on a variety of grounds. They argue that

paragraph 18(g) unlawfully forces minority and female

employees to waive their statutory right to bring private

actions as a condition of obtaining any relief in a govern-

ment “pattern or practice” suit. Alternatively, they argue

that the release constitutes an illegal prospective waiver

of the employee’s Title VII rights. They contend next that

the release interferes with the employee’s right to seek

independent remedies, a right which they assert may not

be compromised as a matter of public policy. Moreover,

the appellants maintain that the back pay fund is grossly

inadequate by comparison with the recoveries that could

be had in contested litigation, and hence that the decrees

are plainly unfair to minority and female employees,

Eschewing as premature any ruling on the validity of

any particular employee’s release, the district court con-

cluded that the appellants’ arguments were lacking in merit

as attacks on the decrees as a whole. Judge Pointer held

“any claims .. . resulting from any alleged violations . . . oceur-

ring on or before” entry date, and for “any damages” suffered

after decree entry “by reason of continued effects” of pre-decree

discriminatory acts or practices. Although the appellants here

presume that the language of the Bell release necessarily falls

short of any compromise as to continued effects, the difference is

not entirely apparent to us. If the parties to this decree had not

inserted the additional specifie limitation concerning continued

effects, but which is itself restricted to claims for damages, it

seems that both releases reasonably could be thought to mean the

same thing: 1. ¢., a bar to additional relief of any kind for con-

tinuing effects of past discriminations. Cf. A. Corbin, Contracts

§ 598, at 588 (1960). Since under our analysis of the law we think

such a release could be valid, but since at the same time the re-

lease sub judice does not cover every item that other parties might

choose to include, it is unnecessary for us to place a definitive con-

struction on the Bell release or attempt to reconcile its meaning

with that of any other release.

57a

Opinion of the Court of Appeals, August 18, 1975

that “there can be a legal waiver of back-pay claims where,

for valuable consideration, a release is signed knowingly

and voluntarily, with adequate notice which gives the em-

ployee full possession of the facts.” *! We agree, but in

order to delineate more precisely the contours of the ap-

plicable rule of law, we hold that the employee may release

not only claims for additional back pay, but also claims

for other relief—including injunctive—provided the re-

leased claims arise from antecedent discriminatory events,

acts, patterns, or practices, or the “continuing” or “future”

effects thereof so long as such effects are causally rooted—

in origin, logic, and factual experience—in discriminatory

acts or practices which antedate the execution of the re-

lease, and provided, of course, that the release is executed

voluntarily and with adequate knowledge, as described by

Judge Pointer.

’ Reduced to their simplest terms, the items to be released

by electing employees pursuant to paragraph 18(g), in re-

turn for back pay, are: (1) all claims (subject to an excep-

tion not now germane) asserting unlawful employment dis-

crimination by the defendants and/or their agents or

privies insofar as such claims are based on acts or practices,

within the scope of the government’s complaint or the con-

sent decrees, which were completed on or before the date

of the decrees’ entry; and (2) claims for damages incurred

at any time because of continued effects of complaint or

decree-covered acts or practices which took place on or

before the entry date of the consent decrees.

There are certain potential rights, however, with respect

to which we do not understand paragraph 18(g) to envision

a compromise. That is because a waiver of these rights

either does not follow from a fair reading of paragraph

163 F.R.D. at 7.

58a

Opinion of the Court of Appeals, August 18, 1975

18(g) (number (1)), or else they are “prospective” and

employees may not waive them (numbers (2) and (3)).

We list them as follows:

(1) The release will not bar an employee from suing in

the future for additional injunctive relief if the reforms

contemplated by the decrees do not eliminate continued

effects which are causally grounded in past acts or prac-

tices of discrimination. For example, suppose a minority

or female employee had been assigned to a lowly job in an

undesirable LOP or pool at some point prior to April 12,

1974. At that point the employee became “locked” into a

departmental seniority system whereby, in bidding for more

desirable vacancies in other departments against white

males with less plant seniority, the minority or female

employee would be denied the new job for want of superior

departmental seniority, though qualifications were other-

wise equal. As of the decrees’ entry, the aggrieved em-

ployee suddenly obtained plantwide seniority, and at

minimum the right to bid for entry-level jobs in other

departments on that basis. See paragraph 7 of Consent -

Decree I. Suppose, then, that subsequent to April 12, 1974

the aggrieved employee successfully bids for an entry-level

job in a new department which offers substantial oppor-

tunity for advancement, perhaps to a trade or craft de-

partment. Because of his or her basic qualifications and

superior plantwide seniority, however, the employee feels

that a higher job in the unit should have been awarded

instead of the entry-level position. Yet at his or her plant

the gencral rule is ethnically and sexually neutral three-

step bidding under paragraph 7(a). We are aware of no

feature of the release which would preclude this employee

from filing a charge with the EEOC, and/or an eventual

lawsuit, seeking suspension of three-step bidding at the

PD

59a

Opinion of the Court of Appeals, August 18, 1975

plant, at least in his or her case. To the extent the plant’s

transfer procedure restrains otherwise qualified, plant-

senior minorities and females from reaching their “rightful

places,” then it may perpetuate the effects of past discrim-

ination. See Stevenson v. International Paper Co., 5 Cir.

1975, 516 F.2d 103, at pp. 114, 116. We emphasize may

because the answer is not now available; it will depend on

the manner in which future circumstances and business

necessities develop. Of course, regardless of the success or

failure of the employee’s challenge to the transfer pro-

cedure, his or her release may be pled in bar to a claim

for damages based on whatever effects of past discrim-

ination the procedure might have continued while it existed.

This variety of grievance is precisely the kind to which

the decrees are directed—present effects of former systemic

discrimination. The decrees may quickly remedy such prob-

lems, if they are given a chance.

(2) Any employee who feels aggrieved by the defen-

dants’ palpable disobedience of the terms of the decrees

may sue, in effect, to enforce them. Although the defen-

dants’ promise to comply runs directly to the government,

rather than to employees, the defendants readily concede

that an episode of nonadherence to the decrees may con-

ceivably constitute a new violation of the law and give

rise to a new cause of action under Title VII or other

applicable law. Whether a particular instance of noncom-

pliance may give rise to a new claim for damages, injunc-

tive relief, or perhaps both or neither, will again depend

on the circumstances. If, for example, a minority or female

individual could show that the company failed to fulfill an

affirmative action goal for promotion to higher-paying

trades and crafts, see paragraph 2(a)(1) of the Agreement

accompanying Consent Decree II; that such failure was

60a

Opinion of the Court of Appeals, August 18, 1975

ue to discrimination; and that he or she was qualified and

would have been promoted at an earlier date but for the

discrimination, then arguably the employee would be en-

titled to the first promotional vacancy and some amount

of money for the period during which promotion was denied.

On the other hand, the company may be able to show that

no one was promoted during the relevant period, or that

the promotions which did occur were based on unusual

needs or other business necessities. Under those circum-

stances the employee may be entitled, if at all, te no more

than a right of first refusal when the next vacancy occurs.

(3) Clearly apart from compliance or noncompliance

with the decrees, the release cannot preclude a suit for any

form of appropriate relief for subsequent injuries caused

by future acts or undertakings the effects of which are

equivalent to the otherwise compromised, noncompensable

effects of past discriminations covered by the complaint

or the decrees. Thus, the defendants are responsible for

their conduct relating to job assignments, tests, qualifica-

tion requirements, transfers, layoffs, and collective bar- -

gaining to the extent these items are carried out after

April 12, 1974. If the defendants engage in new discrim-

ination (of course, they deny that they have engaged in any

heretofore), they will be fully liable for its provable effects

and for provable economic losses caused thereby, regard-

less whether complaining employees signed releases as to

other claims. Thus, it essentially appears that all an em-

ployee really waives in terms of “continued effects” by sign-

ing a release is his or her speculative accrual of further

damages due to the inconceivable possibility that the de-

fendants would take no corrective action whatsoever subse-

quent to the entry of the consent decrees. Obviously they

may not sit still for long, or they will be in contempt—or

6la

Opinion of the Court of Appeals, August 18, 1975

perhaps the warm waters of private litigation if their in-

action breaches an express obligation which they have as-

sumed under the decrees.

This last aspect of the release can have no other ac-

ceptable meaning, for notwithstanding that the systemic

reforms contained in the decrees have been put into op-

eration, thereby undertaking to break the chains of past

causation as it were, the defendants have an ongoing stat-

utory responsibility independent of the decrees to see that

the corrective measures and goals established thereunder

are maintained and updated so that the effects of past dis-

crimination will be wiped out as quickly as due diligence

and business necessity permit. See Pettway, supra, 494

F.2d at 248. This is especially the case with regard to the

elimination of discriminatory departmental seniority strue-

tures, tests, and other custums that can unlawfully restrict

the mobility of minorities and females within and between

LOPs. On the other hand, neither the decrees nor the laws

impose upon the defendants an impossible burden to in-

sure that each victim arrives at his or her “rightful place”

at once. In cases like this, involving large numbers of work-

ers, it can rarely be determined how much a given employee

would have earned or what job he or she would have oc-

cupied during a particular period but for the effects of sys-

temic discrimination. Pettway, supra, at 260, 262. Seldom

can more than speculative back pay relief be obtained si-

multaneously with seniority reform, for despite massive

court-ordered competitive advantages and objective cri-

teria based affirmative action, many aggrieved employees

will not immediately achieve their “rightful places,” but

only a more favorable start on the road toward better jobs.

See, e. g., Pettway, supra, 494 F.2d at 249, 258 (back pay

normally stops accruing when reformed seniority goes into

62a

Opinion of the Court of Appeals, August 18, 1975

effect); Johnson v. Goodyear Tire & Rubber Co., 5 Cir.

1974, 491 F.2d 1364, 1375, 1379 (same; individual cireum-

stances vary and not all class members are automatically

entitled to back pay) ; United States v. Georgia Power Co.,

5 Cir. 1973, 474 F.2d 906, 927.*7 These substantial, flexible

decrees offer much remedial potential in reconciling con-

flicting demands left by decades of history which cannot

be undone. Through the releases as to “continuing effects,”

the defendants will merely be purchasing for themselves

a reasonable oportunity to utilize the decrees in removing

any lingering obstacles that impermissibly prevent minority

and female employees from reaching the road to their

“rightful places.” If the defendants leave gaps in their

performance of this prospective duty by engaging in prac-

tices that reinstitute the discriminatory systems and effects

which they have promised to rectify, then most positively

they will be subject to suit for such conduct even by em-

ployees who signed releases in return for back pay. In

this respect the defendants walk a very thin rope. If, how-

ever, they meet their responsibilities with consistency, then _

** See also Rodriguez v. East Texas Motor Freight, supra, 505

F.2d at 64 at 1284-87; Bing v. Roadway Express, Inc., 5 Cir.

1973, 485 F.2d 441, 450; United States v. Bethlehem Steel Corp.,

2 Cir. 1971, 446 F.2d 652, 660; United States v. Jacksonville

Terminal Co., 5 Cir. 1971, 451 F.2d 418, 452, cert. denied, 406 U.S.

906, 92 S.Ct. 1607, 31 L.Ed.2d 815 (1972); Local 189, United

Papermakers v. United States, 5 Cir. 1969, 416 F.2d 980, 988, cert.

denied, 397 U.S. 919, 90 S.Ct. 926, 25 L.Ed.2d 100 (1970). See

generally Note, Titie VII, Seniority Discrimination, and the In-

cumbent Negro, 80 Harv.L.Rev. 1260, 1266-82 (1967). Of COursé,

the remedy of rate retention, see note 28, supra, operates to reduce

the lag employees experience in reaching their rightful places by

encouraging them to take advantage of opportunities to transfer

into new jobs. See United States v. Bethlehem Steel Corp., supra,

446 F.2d at 660.

63a

Opinion of the Court of Appeals, August 18, 1975

the law regards each employee’s ensuing progress as a

matter of his or her personal talent and initiative.

Lest we be thought to decide more than is necessary for

purposes of this controversy, ve simply note that our con-

struction of paragraph 18(g), just advanced, does not

wholly comport with the views of either the government,

the steel companies, the union, the Harris appellants, or

the three female appellants. Nor do those parties’ inter-

pretations—even among the appeilees—reflect total consis-

tency. Therefore, it was appropriate that we examine and

indicate the meaning of paragraph 18(g), insofar as that

meaning can be gathered from the provision’s plain lan-

guage in light of certain limitations which the law imposes

upon the defendants’ ability to enforce an employee-ex-

ecuted waiver. To be sure, other issues—legal and factual

—will arise as the consent decrees are implemented, no-

tices furnished, back pay accepted, releases executed, and

lawsuits filed. It is sufficient for our purposes, however,

to observe that ample opportunities will exist in other cases

to grapple with those issues under, inter alia, the law of

contracts. See generally A. Corbin, Contracts § 1292 (1962).

Our present inquiry is confined to the narrower question

whether paragraph 18(g) reflects such illegality or impro-

priety that the district court’s approval of the consent set-

tlement should be set aside.

Paragraph 18(g) would provide for an unlawful proce-

dure only if it contemplated a release by employees of pro-

spective rights. Such a proscribed device has been char-

acterized by the Supreme Court as “a waiver in advance of

a controversy.” Wilko v. Syan, 346 U.S. 427, 438, 74 S.Ct.

182, 188, 98 L.Ed. 168, 177 (1953). Cf. Alexander v. Gard-

ner-Denver Co., supra, 415 U.S. at 51, 94 S.Ct. at 1021, 39

L.Ed.2d at 160. Here, all the ingredients of controversy to

64a

Opinion of the Court of Appeals, August 18, 1975

be compromised under paragraph 18(g) have their oper-

ative and legally consequential origin in acts, patterns, and

practices which were performed by the defendants up to

and including April 12, 1974. Those operative ingredients

are thus antecedent to any possible compromise, not pro-

spective. Accordingly, it will be feasible for the Audit and

Review Committee, the Implementation Committees, and

the EEOC in the case of parties with pending charges, to

furnish eligible employees with comprehensive, relevant

information about their rights (for example, their putative

membership in pending private class actions) before any

back pay is delivered and before any releases are signed.

Such information is calculated to insure that each electing

employee settles knowingly and voluntarily, and with an

understanding of the manner and extent to which the de-

erees remedy his or her grievance,

Yet the appellants contend that an intelligent, voluntary

compromise of even an unliquidated, antecedent claim is

unenforceable against the employee as a matter of law and

publie policy. They argue that since Congress attached the

highest priority to the eradication of employment discrim-

ination, and since Congress established a variety of inde-

pendent remedies for making whole its victims, then a set-

tlement of a claim in one forum or proceeding cannot be

raised by the same defendant in bar to another proceeding

for more back pay. They maintain that the employee’s vol-

untary release in settlement of a claim for a disputed and

concededly uncertain sum* can bar the employee only

33 When mammoth groups of affected employees are involved,

as here, individual back pay awards can only be caleulated by a

process fraught with speculation and conjecture. See Pettway,

supra, 494 F.2d at 260-62.

65a

Opinion of the Court of Appeals, August 18, 1975

from obtaining further recoveries in the same forum and

under the same nomenclature as appertained to the pro-

ceeding which resulted in compromise. Specifically, appel-

lants contend that an employee’s release can bar the em-

ployee from recovering against these same defendants only

in another government “pattern or practice” suit insti-

tuted on the same cause of action, as if such were likely

to occur.

This is a novel and ingenious line of argument. It is

calculated to circumvent the dicta i: Gardner-Denver, supra,

415 U.S. at 52 & n. 15, 94 S.Ct. at 1021 & n. 15, 39 L.Ed.2d

at 160 & n. 15, and to gain maximum possible mileage from

the FLSA and related cases led by Brooklyn Savings Bank

v. O’Neil, 324 U.S. 697, 65 S.Ct. 895, 89 L.Ed. 1296 (1945).*

We reject the theory.

The appellate attempt to obfuscate the issue by mixing

several distinct ideas, including election of remedies, pro-

*4 See also D. A. Schulte, Ine. v. Gangi, 328 U.S. 108, 66 S.Ct.

925, 90 L.Ed. 1114 (1946); Martino v. Michigan Window Clean-

ing Co., 327 U.S. 173, 66 S.Ct. 379, 90 L.Ed. 603 (1945); Phila-

delphia, B. & W. R. R. v. Schubert, 224 U.S. 603, 32 S.Ct. 589,

56 L.Ed. 911 (1912) (stipulation for release of railroad’s negli-

gence liability in return for participation in relief fund held un-

enforceable under FELA); Torres v. American R. R. of Porto

Rico, 4 Cir. 1946, 157 F.2d 255, cert. denied, 329 U.S. 782, 67

S.Ct. 204, 91 L.Ed. 671 (1947); Bingham v. Airport Limousine

Service, W.D.Ark.1970, 314 F.Supp. 565; Baker v. California

Shipbuilding Corp., 8.D.Cal.1947, 73 F.Supp. 322. But see Boyd

v. Grand Trunk Western Ry., 338 U.S. 263, 266, 70 S.Ct. 26, 28,

94 L.Ed. 55, 57 (1949); Callen v. Pennsylvania R. R., 332 U.S.

625, 631, 68 S.Ct. 296, 298, 92 L.Ed. 242, 246 (1948); Garrett v.

Moore-MeCormick Co, Tne 217 T1S 229, 248, 63 S.Ct. 246, 252,

87 L.Ed. 239, 245 (1942); Blanco v. Moran Shipping Co., 5 Cir.

1973, 483 F.2d 63, cert. denied, 416 U.S. 904, 94 S.Ct. 1608, 40

L.Ed.2d 108 (1974); Antonioli v. Lehigh Coal & Nav. Co., 3 Cir.

1971, 451 F.2d 1171, 1175 n. 15, cert. denied, 406 U.S. 906, 92

S.Ct. 1608, 31 L.Ed.2d 816 (1972); Urbino v. Puerto Rico Ry.

Light & Power Co., 1 Cir. 1947, 164 F.2d 12, 14.

66a

Opinion of the Court of Appeals, August 18, 1975

spective waiver, liquidated as opposed to unliquidated dam-

ages, and congressional policies underlying different stat-

utes. The most egregious element in this mixture is the

appellants’ fallacious equation of the principles of election

of remedies and release of a cause of action. They cor-

rectly cite Gardner-Denver for the propositions that Con-

gress has created paraliel and overlapping remedies to

combat employment discrimination, that the employee may

pursue those remedies in separate forums, and that “an

employee's rights under Title VII are not susceptible to

prospective waiver.” 415 U.S. at 51, 94 S.Ct. at 1021, 39

L.Ed.2d at 160. They fail to recognize, however, that

Gardner-Denver does not hold or imply that an aggrieved

employee may freely seek additional relief in other forums

after he has voluntarily released in one forum his claims

arising from the same operative factual complex, for val-

uable consideration. A full and adequate compensation for

a wrong, founded in various remedial measures, is one

thing, a succession of compensations, each seeking to be

full and adequate, quite another.

Gardner-Denver holds only that “an individual does not

forfeit his private cause o* action if he first pursues his

grievan © to final arbitration under the nondiscrimination

claus: of a collective-bargaining agreement.” 415 U.S. at

48, 945°. at 1020, 39 L.Ed.2d at 158. Eviseerating Dewey

v. Reynolds Metals Co., 6 Cir. 1970, 429 F.2d 324, 332, aff’d

by equally divided Court, 402 U.S. 689, 91 S.Ct. 2186, 29

L.Fd.2d 267 (1971), the Supreme Court explained quite

succinctly the basis for its decision. Arbitration is a col-

lective right; a Title VII cause of action is a persenal right.

When the employee submits a grievance to arbitration, he

or she is pursuing a contract right which flows from the

collective bargaining agreement. The rights asserted in a

67a

Opinion of the Court of Appeals, August 18, 1975

Title VII suit flow, by contrast, from an act of Congress

independent of the traditional labor-management bargain-

ing process. Most fundamentally, however, the Supreme

Court recognized that the congressional policy behind the

various Title VII remedies for aggrieved workers (charges,

investigations, conciliations, EEOC suits on behalf of

charging individuals, and privat» suits) could be frustrated

in unionized industry if those remedies were subject

to contractual revision, in a “final and binding” manner,

through the majoritarian give-and-take of collective bar-

gaining.** Consequently, neither do the rights conferred by

Title VII constitute a proper subject of collective bargain-

ing, nor may the employer approach the employee directly

in an effort to obtain a prospective waiver “as part of the

economic bargain” with the union, or, by extension, with

the employee even if there is no union.

The appellees rely heavily on certain language in

Gardner-Denver, which concededly is dicta. Still Justice

Powell’s statements appear carefully-considered, and, given

the apparent unanimity with which the Justices accepted

them, we agree with Judge Pointer that appellees’ reliance

is well-taken. The Court stated:

The actual submission of petitioner’s grievance to arbi-

tration.in the present case does not alter the situation

[that prospective Title VII rights may not be waived].

Although presumably an employee may waive his cause

of ction under Title VII as part of a voluntary settle-

** The Court also emphasized that “the arbitrator has authority

to resolve only questions of contractual rights”; that the nondis-

crimination clause of the collective bargaining contract may differ

from the language of Title VII; and that judicial review of final

and binding decisions in arbitration is narrowly circumscribed by

the Steelworkers Trilogy. 415 U.S. at 53, 94 S.Ct. at 1022, 39

L.Ed.2d at 160.

68a

Opinion of the Court of Appeals, August 18, 1975

ment,’® mere resort to the arbitral forum to enforce

contractual rights constitutes no such waiver.

Footnote 15 is as follows:

** In this case petitioner and respondent did not enter

into a voluntary settlement expressly conditioned on a

waiver of petitioner’s cause of action under Title VII.

In determining the effectiveness of any such waiver, a

court would have to determine at the outset that the

employee's consent to the settlement was knowing and

voluntary.

415 U.S. at 52 & n. 15, 94 S.Ct. at 1021 & n. 15, 39 L.Ed.2d

at 160 & n. 15.

The appellants attack this language with other nondeci-

sional language found in footnote 14. There the Court sug-

gested that in cases where the employee prevails at arbi-

tration but later seeks judicial relief, courts are capable

of adjusting their remedies to prevent duplicative recov-

eries. The Court added that if the employee obtained relief

at arbitration “fully equivalent to that obtainable under

Title VII,” then there would be no need for a lawsuit or

additional relief from the courts.

We believe that any apparent conflict is wholly super-

ficial, and that the two statements are easily reconciled by

reference to what was at issue in Gardner-Denver, and

what was not. In the first place, Gardner-Denver did not

involve the volitional release of a cause of action. It did

involve the question whether an employee’s resort to bind-

ing arbitration operates as a binding election of remedies.

For reasons mentioned previously the Court answered that

question in the negative, and footnote 14 is fully consistent

69a

Opinion of .he Court of Appeals, August 18, 1975

therewith. The consistency is reinforced by the remainder

of footnote 15: “In no event can the submission to arbi-

tration of a claim under the nondiscrimination clause of a

collective-bargaining agreement constitute a binding waiver

with respect to an employee’s rights under Title VII.”

(emphasis added).

In no respect does footnote 14, or anything else in

Gardner-Denver, support the assertion that an aggrieved

employee who freely settles his or her unliquidated demand

with the employer or the union may reciprocate by suing

the same deefndant at a later date on the same cause of

action, merely because the employee grows dissatisfied with

the payment for which he or she settled. Very frankly, we

cannot conceive of how any employment discrimination dis-

pute could ever be resolved outside, or indeed inside, the

courtroom, if defendants were forbidden to obtain binding,

negotiated settlements. No defendant would ever deliver

money, promises, or any other consideration—not even a

peppercorn—-except after entry of a contested, final court

order, and even this, on appellants’ reasoning, might not

end the matter. The EEOC and judicial caseloads would

swell to chaotic dimensions. Industrial peace would be need-

lessly threatened. The sitwation. would be greatly inequi-

table to private parties who, for lack of funds or otherwise,

failed to sue on their own and yet also preferred not to

take their chances with unpredictable, protracted class

actions managed by strangers, a matter over which present

practice often leaves them little or no option.” In sum,

36 See the discussion at footnotes 85-86, infra, and accompanying

text. See also Johnson v. Georgia Highway Expr °ss, Inc., 5 Cir.

1969, 417 F.2d 1122, 1127 (Title VII class action under F.R.Civ.P.

23(b) (2), seeking systemic injunctive relief and back pay; God-

bold, J., specially concurring) :

Some of the difficulty may be sifted out by findings of the

trial court at or during the trial that the plaintiff adequately

70a

Opinion of the Court of Appeals, August 18, 1975

apnellants’ theory is as unrealistic, unsound, and ultimately

rooted in dogmatism as its thoroughly discredited obverse—

the notion that private nonparties are bound by res judicata

or estoppel to the results of government “pattern or prac-

tice” suits. Such a doctrine is unheard of. It deprives the

employee of the chance to make a choice that previously

was not available, even though the opportunity itself does

not cost the employee a wink. It is contrary to the policies

and procedures that heretofore have been followed in em-

ployment discrimination cases.*" It seemingly has been

represents the class. But this issue itself may be determined

in the absence of 99.9% of those affected, who have had no

notice or service of process or right to be heard and who may

feel that the plaintiff in the particular case (or his counsel,

or both) is the last person they want representing them.

(footnote omitted). Cf. Miller v. Mackey International, Inc., 5

Cir. 1975, 515 F.2d 241, at p. 244 (F.R.Civ.P. 23(b) (3) class ac-

tion ; Bell, J., specially concurring; arguing for opt-in class actions

when large numbers of putative members are involved).

Under §706(b) of Tithe VIT, 42 U.S.C. § 2000e-5(b), the

EEOC is obligated to attempt to conciliate employment diserim-

ination charges upon which the Commission has found “reasonable

cause.” If it appears that a charge can be resolved informally,

the EEOC affords the aggrieved party an opportunity to partici-

pate in the settlement. See § 706(f)(1). A typical conciliation

agreement reads as follows:

The Charging Party deems this Agreement to be fair and

equitable, and hereby waives, releases and covenants not to

sue the Respondent with respect to any matters which were

or might have been alleged as charges filed with the Equal

Employment Opportunity Commission, subjeet to perform-

ance by the Respondent of the promises and representations

contained herein. . . .

1 CCH Emp. Prac. Guide {§ 1680.02, at 1449 (1973) (emphasis

added).

The legislative history of the 1972 amendments to Title VII

leaves no doubt that persons who execute such conciliation agree-

ments may not thereafter maintain lawsuits against respondents.

[The enacted bill] contains . . . a provision for termination

of the right of private action once the Commission .

7la

Opinion of the Court of Appeals, August 18, 1975

rejected by this court on a previous occasion, see Rodri-

guez v. East Texas Motor Freight, supra.** We explicitly

refuse to recognize it here,

There remain the matters of public policy and the alleged

insufficiency of the back pay fund. We are aware of no

case which has held, or even suggested, that an employee’s

binding release for valuable consideration of a disputed

(in fact and amount) employment discrimination claim vio-

lates public policy. Appellants- point to no such cases, but

rely instead upon two early decisions under the Fair Labor

Standards Act, 29 U.S.C. § 201 et seq., Brooklyn Savings

Bank v. O’Neil, supra, and D. A. Schulte, Ine. v. Gangi,

supra note 34, together with various progeny. Although

these decisions established that the right under the FLSA

to receive “minimum wages, promptly paid’ plus time-and-

enters into a conciliation or settlement agreement which is

satisfactory to the Commission and to the person aggrieved.

If such an agreement is not acceptable to the aggrieved party,

his private right of action is preserved.

H.Rep.No.92-238, reporting H.R. 1746, 92d Cong., 2d Sess., 1972

U.S.Code Cong & Admin.News, 2137, at 2148 (reporting § 715 of

H.R. 1746). See also Leisner v. New York Tel. Co., 8.D.N.Y.1973,

358 F.Supp. 359, 367.

8 = We hold, therefore, that the consent decree does not operate

as collateral estoppel to prohibit any members of the plaintiff

class from participating in relief in this case. (citation omit-

ted). Those members of the plaintiff class who accept compen-

sation under the consent decree and sign a release, of course,

are bound by the terms of the release. But no other members

of the plaintiff class lose any right to relief in the instant case.

505 F.2d at p. 65 (emphasis added). See also Pettway v. American

Cast Iron Pipe Co., supra, 404 F.2d at 267 (Bell, J., specially con-

curring) (encouraging use of consent decrees to settle back pay

claims) ; United States v. Georgia Power Co., N.D.Ga. Jan. 31,

1974, No. 12355, at 14 (“Amended and Final Decree” following

our remand ; employees must execute “general release” as condition

of obtaining back pay in government pattern or practice suit;

approved in Pettway, supra, 494 F.2d at 262 n. 152, 264 n. 156a).

72a

Opinion of the Court of Appeals, August 18, 1975

one-half for overtime was absolutely enforceable upon pain

of damages, they are clearly distinguishable from this case

and furnish no support to appellants.

Neither O’Neil nor Schulte held that employees may not

accept compromise payments and waive their claims for

further relief in situations where the fact of liability or

the amount thereof is disputed. In O’Neil, for example,

the Supreme Court expressly limited as the issue before it

“whether in the absence of a bona fide dispute between the

parties as to liability” an employee could waive the liqui-

dated damages to which the statute entitled him. 324 U.S.

at 704, 65 S.Ct. at 900, 89 L.Ed. at 1307. The Court took

great care not to decide “what limitation, if any... the

Act places on the validity of agreements between an em-

ployer and employec to settle claims arising under the Act

if the settlement is made as a result of a bona fide dispute

between the two parties, in consideration of a bona fide

compromise and settlement.” 324 U.S. at 714, 65 S.Ct.

at 905, 89 L.Ed. at 1313.

In Schulte the Court held that where the only bona fide

dispute concerned whether the employer was covered by

the FLSA, the employee was not bound to his or her com-

promise for less than the statutory liquidated reparation.

The Court reasoned very simply that in the absence of any

dispute other than mere coverage, an employer covered by

the Act should not be able*to escape its statutory obliga-

tion on the theory that coverage was not altogether clear.

Again, however, the Court noted that it was not passing

on the quite different question whether a covered employer

could enter into a settlement with its employees where a

bona fide dispute existed as to liability or amount.*® More-

3° “Nor do we need to consider here the possibility of compro-

mises in other situations which may arise, such as a dispute over

73a

Opinion of the Court of Appeals, August 18, 1975

over, in Schulte the Court left open the possibility that it

might approve consent decrees which compromised the

amount of payment even where liability and amount were

not seriously disputed: “{WlJe think the requirement of

pleading the issues and submitting the judgment to judi-

cial scrutiny may differentiate stipulated judgments from

compromises by the parties.” 328 U.S. at 113 n. 8, 66 S.Ct.

at 928 n. 8, 90 L.Ed. at 1118 n. 8.

Subsequent to O’Neil and Schulte, the courts of appeals

dismissed the argument that those decisions somehow for-

bade voluntary compromises, executed pursuant to consent

judgments, with respect to sums the amount of or liability

for which was disputed. See, e. g., Urbino v. Puerto Rico

Ry. Light & Power Co., 1 Cir. 1947, 164 F.2d 12 (employees

settled for minimum FLSA wage plus overtime but not

liquidated damages; release constitutes effective bar to sub-

sequent suit for liquidated damages; “the rule of the

Schulte case goes to the verge of the law and this being

our view we decline to extend that rule any further”) ;

Bracey v. Luray, 4 Cir. 1947, 161 F.2d 128. See also Bowers

v. Remington Rand, Inc., 7 Cir. 1946, 159 F.2d 114, cert.

denied, 330 U.S. 843, 67 S.Ct. 1083, 91 L.Ed. 1288 (1947)

(employer and employee may settle by agreement question

whether sleeping time at jobsite constitutes working time).

Nor did the decisions of the Supreme Court on similar

questions under other statutes yield any indication that the

O’Neil-Schulte strict FLSA approach would be extended.

In Callen v. Pennsylvania R.R., 332 U.S. 625, 68 S.Ct. 296,

92 L.Ed. 242 (1948), the Court considered the possible val-

idity of a release under a statute which specifically pro-

hibited any contract for an employer’s exemption from li-

the number of hours worked or the regular rate of employment.”

328 U.S. at 114, 66 S.Ct. at 928, 90 L.Ed. at 1118.

74a

Opinion of the Court of Appeals, August 18, 1975

ability for injuries to employees. (4 5, Federal Employers’

Liability Act, 45 U.S.C. § 55). The Court ruled that a re-

lease could be valid because

[i]t is obvious that a release is not a device to exempt

from liability but is a means of compromising a claimed

liability and to that extent recognizing its possibility.

Where controversies exist as to whether there is lia-

bility, and if so for how much, Congress has not said

that parties may not settle their claims without litiga-

tion.

332 U.S. at 631, 68 S.Ct. at 298, 92 L.Ed. at 246. The later

case of Boyd v. Grand Trunk Western R.R., 338 U.S. 263,

70 S.Ct. 26, 94 L.Ed. 55 (1949), upon which appellants rely,

is not to the contrary. There the Court explained that

Callen correctly distinguishes “a full compromise enabling

the parties to settle their dispute without litigation, which

we held did not contravene the Act, from a device [exclu-

sive venue contract] which obstructs the right of the

[FELA] plaintiff to secure the maximum recovery if he.

should elect judicial trial of his cause.” 338 U.S. at 266,

70 S.Ct. at 28, 94 L.Ed. at 58. (emphasis added). Cf. also

Dunean v. Thompson, 315 U.S. 1, 7, 62 S.Ct. 422, 424, 86

L.Ed. 575, 579 (1942).

In Garrett v. Moore-MeCormack Co., Inc., 317 U.S. 239,

63 S.Ct. 246, 87 L.Ed. 239 (1942), the Court held that bene-

fits conferred upon seamen by the law of admiralty and

the Jones Act, 46 U.S.C. 4688, may be released if it is

shown by the proponent that the waiver “was executed

freely, without deception or coercion, and that it was made

by the seaman with full understanding of his rights.” “

9317 US. at 248, 63 S.Ct. at 252, 87 L.Ed. at 245. The Court

added that “[t}he adequacy of the consideration and the nature of

75a

Opinion of the Court of Appeals, August 18, 1975

In Blanco v. Moran Shipping Co., 5 Cir. 1973, 483 F.2d

63, cert. denied, 416 U.S. 904, 94 S.Ct. 1608, 40 L.Ed. 2d 108

(1974), we recently reaffirmed the Garrett formulation as

the “classic test” of a valid and binding release."

To be sure, the appellants’ public policy position is ten-

able insofar as the O’Neil-Schulte line of cases once stood

rather inflexibly for the idea that certain benefits under

protective legislation would be sold for a song unless safe-

guarded by extraordinary measures. Yet it remains that

those cases were tied closely to the mandatory terms of

particular statutes, the labor conditions that produced those

statutes, and what the Court believed was a clearly dis-

cernible congressional intent. Since then, courts have de-

clined in most instances to fashion comparable doctrine

from whole cloth, the stronger reasoning being that the

rubric of “unequal bargaining power” all too often tempts

the judiciary to promulgate social values which, at best,

intrude upon the legislative sphere, and at worst reflect

imprecise apprehensions of economics and desirable public

policy. See, e.g., Walling v. Portland Terminal Co., 330

U.S. 148, 155, 67 S.Ct. 639, 643, 91 L.Ed. 809, 814 (1947)

(Jackson, J., concurring) (‘Interminable litigation, stimu-

lated by a contingent reward to attorneys is necessitated

by the present state of the Court’s decisions”).

Perhaps it was in an effort to mollify Justice Jackson’s

indignation that Congress enacted the Portal-to-Portal Pay

Act in 1947," one provision of which (29 U.S.C. 4 253(a))

the medical and legal advice available to the seaman at the time

of signing the release are relevant to an appraisal of this under-

standing.” Id. (footnote omitted).

*! See also Antonioli v. Lehigh Coal & Nav. Co., supra note 34.

*? It is interesting to note that when Congress enacted the Portal-

to-Portal Pay Act, it listed as one of the prompting considerations

76a

Opinion of the Court of Appeals, August 18, 1975

expressly declared that FLSA claims “may hereafter be

compromised in whole or in part, if there exists a bona fide

dispute as to the amount payable by the employer to his

employee,” provided, of course, that the parties utilize an

hourly rate equal to the minimum wage. The Act also pro-

vided for waivers of liquidated damages, § 253(b), and

announced that its effect would be retroactive as to “any

compromise or waiver heretofore so made or given.” 29

U.S.C. 6 253(d). See McCloskey & Co. v. Eckart, 5 Cir.

1947, 164 F.2d 257,

So sharply undereut by Congress even in their immediate

ambit, O’Neil and Schulte inescapably provide no support

to appellants. Nor do the FELA, Truth-in-Lending Act, or

other cases briefed by appellants cast the slightest shadow

of doubt upon Congress’ selection of voluntary conciliation

and compliance as the preferred means—-or means at least

as viable as any other—for the vindication of Title VII

rights. Though the appellants’ contentions may possibly

have vitality in rare situations where amounts due “may

be mathematically caleulated by simple arithmetic,” e. g.,

Watkins v. Hudson Coal Co., 3 Cir, 1945, 151 F.2d 311, 314,

we agree with Judge Pointer and the appellees that they

will seldom apply, if ever, to Title VII seniority cases,

which are inevitably attended by “the impossibility of

calculating the precise amount of back pay.” Pettway,

supra, 494 F.2d at 260. Accordingly, we hold that para-

graph 18(g¢) does not violate public policy.

that, if the Supreme Court's line of decisions under the FLSA

were allowed to persist, “the courts of the country would be bur-

dened with excessive and needless litigation and champertous prae-

tices would be encouraged.” Act of May 14, 1947, ¢. 52, §1, 61

Stat. 84, 29 U.S.C, §251(a) (7).

77a

Opinion of the Court of Appeals, August 18, 1975

Appellants next assert that an average of $500 per eli-

gible employee in immediate, litigation-free back pay is a

priori inadequate and that the consent decrees therefore

must be vacated, Our limited scope of review neither re-

quires nor permits us to decide this question in a manner

which resolves each and every doubt, as if that were pos-

sible in any event.** Nor may we pick and choose between

conflicting factual hypoth ses as if we were a jury. We

are concerned, instead, with a seale of probabilities: the

probable outcome of contested litigation, balanced against

its probable costs in time, money, and public resources,

Bryan vy. Pittsburgh Plate Glass Co., supra, 494 F.2d at

801; Florida Trailer and Equipment Co. v. Deal, supra.

Furthermore, we think it appropriate to take account of

the injunctive relief provided by the consent decrees. That

plenary relief, diligently implemented and monitored ac-

cording to the terms of the decrees, will greatly shorten

the timespan during which “continuing effects” back pay

claims might otherwise continue to mount. Cf. Patterson

v. Newspaper Deliverers’ Union, supra. Correspondingly,

it is undeniably in the defendants’ interests to promptly

implement the reforms, for surely some eligible employees

"8 Sce Pettway, supra, 494 F.2d at 261:

[When the class size or the ambiguity of promotion or hiring

practices or the multiple effects of discriminatory practices

or the illegal practices continued over an extended period of

time calls forth the quagmire of hypothetical judgment dis-

cussed earlier, a class-wide approach to the measure of back

pay is necessitated. It should be emphasized that this is not

a choice between one approach more precise than another.

Any method is simply a process of conjectures.

(footnotes omitted),

“Cf. Id. at n. 151: “The process of computation and burden of

proof is not an ‘either, or’ approach,”

78a

Opinion of the Court of Appeals, August 18, 1976

will decline the tender of back pay in the anticipation of

accruing and suing for more,"* which is their right.

Viewed from the foregoing perspective, appellants’ con-

tention of inadequacy must be rejected. Their argument

comes in essentially two parts: first, an allegation that

$500 per employee is considerably less than the awards

which have been won in comparable contested lawsuits;

second, they assert that the offered sums are fatally insuffi-

cient because the appellecs have not shown those suma to

equal “100% of the amount to which each employee would

be entitled if the government, or the employee, suecessfully

litigated [each] back pay claim to final judgment.” ”

The second argument is clearly without merit in two

respects, In the first place, the burden—if one is to be

assigned—is upon the appellants to demonstrate abuse of

discretion in Judge Pointer’s acceptance of the decrees,

More substantially, however, appellants have assumed that

virtually every back pay claimant would sueceed in court,

either in a private suit or on the coattails of a government

suit. The experience of the one contested suit which they

cite--the Fairfield Works ee, see footnotes 7 and 28,

supra does not support the assumption, Nor may the

appellants reasonably assume that the government would

ane every defendant at every affected plant and department

for back pay in the absence of, or simultaneously with, the

*’ A tactic whose likelihood of success we considered an open

question, Compare Williamson v. Bethlehem Steel Corp., supra,

468 F.2d at 120% (private parties are not hound by enecess or

failure of the government in a “pattern or practice” action), with

Pettway v. American Cast Tron Pipe Co, supra, 494 F.2d at 258

(back pay normally stops accruing when reformed seniority goes

into effect).

“Brief for appellants, Harris, et al, at 31 (emphasis added),

79a

Opinion of the Court of Appeals, August 18, 1976

private litigation which they seek to pursue. As we discuss,

infra, the government labors under no legal obligation to

sue any particular party upon any given occasion. In any

event, the Fairfield Works case illustrates a variety of other

factors—mainly considerable delay and expense to all par-

ties—which subtract from appellants’ preference for liti-

gation over voluntary compliance. That much we may

assuredly say without commenting one way or the other

about the merits of the back pay issues which are presently

on appeal in the Fairfield case.

Moreover, to the extent appellants contend that the aver-

age claimant’s recovery in Fairfield exceeded the average

award under the consent decrees, their argument is mis-

leading. They note that around sixty employees recovered

$201,000, or an average of $3,250 per successful employee.

They do not mention, however, that more than 3,000 other

employees were held entitled to no back pay, with the

result that the average award per claimant came to around

sixty dollars, or $440 less than under the consent decrees.

Nor do they mention that the Fairfield awards were based

on a 150 percent-of-actual loss theory, the additional fifty

percent representing an estimate for unmatured future

effects of past discrimination. See 371 F.Supp. at 1060. It

is also useful to note that within the three departments

in which the sixty (or sixty-one) suecessful claimants

worked, there were some 298 other members of these classes

who received no back pay, and that holding was not ap-

pealed. Nor were appeals taken from the classwide denials

of back pay in the other private actions, which involved

about 105 employees. Without saying more about the Fair.

field ease, we may candidly observe that it is far from

clear that any particular employee would be better off if

he or she awaited contested litigation in lieu of accepting

80a

Opinion of the Court of Appeals, August 18, 1975

the back pay provided by the consent decrees.” If the

decrees were vacated, however, it is clear that litigation-

‘7 The method utilized by Judge Pointer for computing and

awarding back pay within the three Fairfield departments and

corresponding private classes as to which he found that the se-

niority system had caused economic damages to blacks is set forth

in 371 F.Supp. at 1060. Generally speaking, the court awarded

the fund generated by each class’s proof on a “winner take all”

basis to the “oldest” blacks in the class from the standpoint of

plant seniority in light of a hypothetical reconstruction of employ-

ment histories which had been dominated by “younger” whites

and to some degree post-Act-hired blacks between July 2, 1965

and the entry of the court’s remedial decree. Thus, for purposes of

awarding back pay, the “oldest” blacks were permitted to “leap-

frog” in order of plant seniority. Once the historic vacancies in

pertinent LOPs had been accounted for, however, no more blacks

in the three successful classes received back pay.

The relatively small total membership (approximately 360) of

those three classes made the reconstruction method feasible on an

individualized basis by virtue of the court’s assumption of blacks’

equal fitness for promotion when competing with whites in the

line, and devotion of each flow chart to a single LOP. With this

group of blacks, but especially with a larger group, other methods

of class-wide distribution might have beer used, see note 29, supra,

but no one complained on appeal about the method selected by

Judge Pointer. Interestingly, if the court had used a pro rata

schedule, the average recovery per claimant—assuming some re-

covery by each claimant—would have been somewhat as follows:

the Hardy class—154 blacks at $280 each; the McKinstry class—

170 blacks at $270 each; the Ford class—35 blacks at $3,200 each.

In summary, although precise comparison is impossible absent data

on the numbers of class members who were hired after 1967 and

are thus ineligible for back pay under the Consent Decree, it re-

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