Petition — Indiana Employment Security Board v. International Union, United Automobile, Aerospace & Agricultural Implement Workers

') SEP 20 1979

:

_MICHAGL ROPAK, IR. CLERK

IN THE

Supreme Court of the United States

OctoBer TERM, 1979

No.

THE INDIANA EMPLOYMENT SEcuRITY Boarp,

et al.,

Petitioners,

V.

INTERNATIONAL Union, Unirep AUTOMOBILE AEROSPACE AND

AGRICULTURAL IMPLEMENT Workers oF America, UAW, et al.,

Respondents.

PETITION FOR A WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE SEVENTH CIRCUIT

Tueopore L. SENDAK

Attorney General of Indiana

Dona.Lp P. Bocarp

Chief Counsel-Staff

Office of the Attorney General

219 State House

Indianapolis, Indiana 46204

Telephone: (317) 232-6217

Attorneys for Petitioners.

ee ———————————__—_

eae cen ti vcessceeccss

aig aeik Wek wk Kb a0 hes 5s

Se

CS BESET a ee

Constitutional and Statutory

GS ES SE ee ee re

EE I

Facts Material to Question

Presented for Review ...................

Reasons for Allowance of the Writ.............

I. This Cause is Barred by the

Eleventh Amendment to the

Constitution of the

ee ee a ka we ss

II. The Decision Below Rests on

the Application of Law Inapposite

to the Facts of This Case .............

ee vais Sees

Appendix:

I. Opinion of the United States Court

of Appeals for the Seventh Circuit,

No. 78-2548, issued on June 22,

Oe OE is ae eee

II. Memorandum of Decision issued on

August 10, 1978, by the United

States District Court for the

Southern District of Indiana,

Indianapolis Division, No. IP

I ee Sa aie. wap 06 6 00:4)4'0

III. Entry of the United States

District Court for the Southern

District of Indiana, Indianapolis

Division, No. IP 76-705-C, dated

eevee eedasees

TABLE OF AUTHORITIES

Cases

Page

Cleveland Board of Education v.

LaFleur, 414 U.S. 632 (1974)... .. ccc ccc 5, 7,8

Cohen v. Chesterfield County

School Board, 414 U.S. 632 (1974)....... ap PE 7

Edelman v. Jordan, 415 U.S. 651 (1974) ............ 6

Ford Motor Company v. Department of

Treasury of State of Indiana, 323 U.S.

ca ce, aR BN TR SRE [ASRS ae a 6

Geduldig v. Aiello, 417 U.S. 484 (1974) ............. 8

General Electric Co. v. Gilbert,

cy fe Mc SRR UA i oon ag a EN 8

Nashville Gas Co. v. Satty,

Ne a MRO eo ee tt, 8

Turner v. Department of Employment

Security, 425 UB. 446 (AGTG) «ono vc vc 5.6. 7,3

Constitutional and Statutory Provisions:

Eleventh Amendment to tle Constitution of

oe ES) 2, 3,6

Fourteenth Amendment to the Constitution of

Py OI he en eae nd 2,3

See PL RIE as ce a a Bea Me 2

eRe nets PN sp aie al ele AE eh 8 2

Pa NG 5G i tee ee a ee are 5

Sy SM 5 io oi Noa Sina tech ickonsi pee. 5

RI ON no hs tar es ats A ee ae 5

We REE BG iS oo bak oo ss ons oa eh oan 5

42 U.S.C. $2000g, 2 Sih x RE aie <a eRe ERE aD kt 5

ii

Mk PIE os sav oss CkGn MO dea s os den eee 4,6

OE ix vasdd ux cvaceuduxes es Biches 608i esctn 4,6

ES ve tcrcece re rol re eee s Cee eae 4,6

oT ey ee sr 3, 5, 7,8

ies, MOR et oe oes ala ac cine ec ca eae eee 3,5, 8

' Other Authorities:

Rule 19(1)(b) of the Rules of the Supreme Court

ee GI vc epee a ae 2

<n

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1

/ iii

IN THE

Supreme Court of the United States

OctoBer Term, 1979

THe INDIANA EMPLOYMENT SeEcurRITY Boarp,

et al.,

Petitioners,

Vs

INTERNATIONAL Union, Unirep AUTOMOBILE, AEROSPACE AND

AGRICULTURAL IMPLEMENT Workers OF America, UAW,

et al.,

Respondents.

PETITION FOR A WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE SEVENTH CIRCUIT

The petitioners, the Indiana Employment Security

Board by and through its individual members, William H.

Andrews, George Elrod, Glenn Ray, Richard O. Ristine,

and Max Wright; the Indiana Employment Security Divi-

sion, Unemployment Compensation Section, by and

through its Review Board Members William H. Skinner,

J. Frank Hanley II, and Ralph F. Miles; and the Indiana

Employment Security Division, Unemployment Compen-

sation Section by and through its Appellate Division

Chief, Keith Campbell, respectfully pray that a writ of

certiorari issue to review the judgment and opinion of the

United States Court of Appeals for the Seventh Circuit

(hereafter Seventh Circuit) entered in this proceeding on

1

2

June 22, 1979. That opinion was pursuant to an appeal by

respondents International Union, United Automobile,

Aerospace and Agricultural Implement Workers of Ameri-

ca, UAW; Barbara Kubisiak: Lynda Baker; Barbara Rob-

bins; Doris Kuntz, and Sherry Blocher.

OPINIONS BELOW

The opinion of the Seventh Circuit appears at 600 F.2d

118 and is attached at page A-1 of this petition. The

unreported Memorandum of Decision issued August 10,

1978, by the United States District Court for the Southern

District of Indiana, Indianapolis Division (hereafter Dis-

trict Court) and its Entry of October 27, 1978, also unre-

ported, are attached at pages A-5 and A-10 respectively.

JURISDICTION

The Seventh Circuit decided this cause on June 22.

1979, and no rehearing has been sought. This petition for

certiorari was filed within the 90-day period allowed by 28

U.S.C. §2101(c). Jurisdiction is invoked under 28 U.S.C.

§1254(1) and Rule 19(1)(b) of the Rules of this Court, to

review an opinion of the Seventh Circuit which has ren-

dered a decision on a federal question contrary to applic-

able decisions of this Court, the result of which was to

declare two Indiana statutes unconstitutional.

QUESTIONS PRESENTED

1. Whether this cause was barred by the Eleventh

Amendment to the Constitution of the United States.

2. Whether the Due Process Clause of the Fourteenth

Amendment to the Constitution of the United States invali-

dates a state unemployment compensation statute which

does not include among its beneficiaries persons barred from

work by their employers because of pregnancy.

CONSTITUTIONAL AND

STATUTORY PROVISIONS INVOLVED

The Eleventh Amendment to the Constitution of the

United States provides as follows: “

3

The judicial power of the United States shall not

be construed to extend to any suit in law or equity,

commenced or prosecuted against one of the United

States by citizens of another state, or by citizens of

subjects of any foreign state.

The Mie ie Amendment to the Constitution of the

United States provides, in part, as follows:

All persons born or naturalized in the United

States, and subject to the jurisdiction thereof, are

citizens of the United States and of the State

wherein they reside. No State shall make or enforce

any law which shall abridge the privileges of im-

munities of citizens of the United States; nor shall

any State deprive any person of life, liberty, or

property, without due process of law; nor deny to

any person within its jurisdiction the equal protec-

tion of the laws.

Indiana Code §22-4-14-3 (Burns 1974, tit. 22, pp. 428-

429) (repealed in relevant part, Pub. L. 253 §1 (1975)):

An unemployed individual shall be eligible to

receive benefits with respect to any week only if he

is physically and mentally able to work, is avail-

able for work and is found by the division to be

making an effort to secure work ... For the purpose

of this article [22-4-1-1 — 22-4-38-3], unavailabil-

ity for work of an individual shall be deemed to

exist but shall not be limited to, any case in which,

with respect to any week, it is found:

...(d) That such individual’s unemployment is

due to pregnancy....

Indiana Code §22-4-15-1 (Burns 1974, tit. 22, pp. 434-

436) (repealed in relevant part, Pub. L. 262, §25 (1977)):

[AJn individual shall be ineligible for any wait-

ing period or benefit rights based upon wages

earned from any employer whose employ he has left

voluntarily without good cause attributable to the

employer or from which he has been discharged for

misconduct in connection with his work: Provided,

however that... [sleparation from employment be-

4

cause of pregnancy shall be construed as within the

purview of the disqualification provided herein....

Indiana Code §22-4-2-4 provides as follows:

“Contributions” means the money payments to

the employment security fund, required and pro-

vided by the terms of this act [22-4-1-1 — 292-4-

38-3]. [Acts 1947, ch. 208, §204, p. 673.]

Indiana Code §22-4-2-9 provides as follows:

“Fund” means the employment security fund, es-

tablished by IC 1971, 22-4-26-1, in which all con-

tributions required[,] all payments in lieu of contri-

butions and all money received from the federal

government as reimbursements pursuant to section

204 of the Federal-State Extended Compensation

Act of 1970, 26 U.S.C. §3304n, shall be deposited

and from which all benefits provided under this

1947, ch. 208, §209, p. 673; 1971, P.L. 355, §1, p.

1376; 1973, P.L. 239, §1, p. 1242.]

Indiana Code §22-4-10-1 provides, in part, as follows:

Contributions shall accrue and become payable

from each employer for each calendar year in which

it is subject to this article [22-4-1-1 — 22-4-38-3]

with respect to wages paid during such calendar

year except where the status of an employer is

changed by cessation of disposition of business or

appointment of a receiver, trustees, trustee in

bankruptcy or other fiduciary, contributions shall

immediately become due and payable on the basis

of wages paid or payable by such employer as of the

date of the change of status. Such contributions

shall be paid to the board in such manner as the

7

article (22-4-1-1 — 22-4-38-3] shall be paid. [Acts

a

5

board may prescribe, and shall not be deducted, in

whole or in part, from the remuneration of individ-

uals in an employer’s employ.

STATEMENT OF THE CASE

This action was brought by Respondents pursuant to 42

U.S.C. §§ 501 et seg., 1983, and 2000e-2, to secure pay-

ment of unemployment benefits to five (5) females who

alleged they were denied such benefits due to pregnancy.

Respondents alleged violations of the Equal Protection

and Due Process clauses of the Fourteenth Amendment to

the Constitution of the United States and also sought

declaratory relief pursuant to 28 U.S.C. §§ 2201 and 2202.

Facts Material

To Questions Presented For Review

At issue in the District Court were portions of Indiana

Code § 22-4-14-3 and § 22-4-15-1 (Burns 1974), the rele-

vant parts of which have since been repealed. Respondents

sought certification as a class, injunctive and declaratory

relief, and unemployment compensation payments with

interest thereon. Petitioners moved for dismissal on sever-

al grounds, and the District Court granted that motion

based upon Respondents’ failure to state a claim upon

which relief could be granted. A-9. Respondents then

moved the court to reconsider, and to alter or amend its

judgment. The District Court reconsidered this Court’s

opinions in Turner v. Department of Employment Security,

infra, and Cleveland Board of Education v. LaFleur, infra,

and, finding them inapposite, denied the motion. A-10.

The Seventh Circuit reversed the judgment and re-

manded the case for further proceedings, holding that the

statutes violated the Due Process Clause as it was applied

in Turner.

Answers to Interrogatories filed in this case show that of

the four original individual Plaintiffs in the District

Court, three had never applied for unemployment compen-

sation benefits and the fourth had not received a deter-

mination from the reviewing deputy. A fifth plaintiff who

alleged a denial of benefits was added in the Second

6

Amended Complaint, which was allowed to be filed t

leave of Court in the Memorandum of Decision that ren-

dered judgment in favor of the Defendants.

Those Interrogatory Answers alsc show that the periods

of time between separation from employment and child-

birth for the five named Plaintiffs were 3, 39, 40, 91 and

128 days.

REASONS FOR ALLOWANCE OF THE WRIT

I

This Cause is Barred by the Eleventh Amendment

to the Constitution of the United States.

Petitioners would submit that jurisdiction in this case

was barred by the Eleventh Amendment to the Constitu-

tion of the United States. Respondents herein brought this

“action against the Petitioner boards and divisions and

their members in their official capacities for the payment

of past workmen’s compensation benefits which were al-

leged to have been wrongfully denied. As such, this is a

suit against the State of Indiana since the Petitioners are

but nominal parties and any recovery will come from

public funds derived from the State Treasury. Indiana

Code §§ 22-4-2-4, 22-4-2-9, and 22-4-10-1. Ford Motor

Company v. Department of Treasury of State of Indiana,

323 U.S. 459 (1945).

Injunctive relief has obviously been precluded since the

statutes being chalienged have been repealed by the Indi-

ana General Assembly. Therefore, the only relief that

could possibly be ordered by the District Court would be

the payment of past benefits. Such payments would be

precluded under Edelman v. Jordan, 415 U.S. 651 (1974).

‘

Il.

The Seventh Circuit’s Decision Rests

on the Application of Law

Inapposite to the Facts of This Case.

The Seventh Circuit stated that “we are of course bound

to follow the Turner holding,” which it interpreted to

vs

~

7

mean that a “state statute that denies unemployment

benefits to all women who are unemployed because of

pregnancy without regard to whether individual pregnant

women have the physical capacity to continue work is

invalid....” The fact situation in the case at bar, how-

ever, does not warrant application of Turner v. Department

of Employment Security, 423 U.S. 44 (1975).

The statute at issue in Turner raised “a conclusive

presumption that women are ‘unable to work’. during” a

period extending from twelve weeks prior to the expected

birth to six weeks after the birth, id. at 45. This Court

held that the “statute’s incorporation of a conclusive pre-

sumption of incapacity during so long a period before and

after childbirth is constitutionally invalid under the prin-

ciples of’ Cleveland Board of Education v. LaFleur, 414

U.S. 632 (1974). Id. at 46. At issue in LaFleur was a school

board rule requiring pregnant teachers to take a leave

extending from five months before the expected date of

birth until the beginning of the semester following the

date when the child was three months of age. In a compan-

ion case to LaFleur, Cohen v. Chesterfield County School

Board, 414 U.S. 632 (1974), decided the same day, the

school regulations at issue were essentially the same. This

Court held that due process requires something other than

a blanket rule to accomplish the school boards’ goals.

Althgugh this Court has not articulated what “alternative

iNistrative means” (id. at 647) are required, it noted

olding did not require “an individualized deter-

in each case and in every circumstance,” id. at n.

The Indiana statutes invalidated by the Seventh Circuit

did not prescribe any period during which pregnant per-

sons should be separated from employment; they left that

determination up to the employers and the workers. Like-

wise, the statutes at issue did not incorporate “a conclu-

sive presumption of incapacity.” One of the laws deemed

an individual whose “umemployment is due to pregnancy”

to be unavailable for work (Ind. Code Ann. § 22-4-14-3

(Burns 1974)); the other disqualified from benefit rights a

woman separated from employment due to pregnancy

“only if she fails to apply for or to accept a leave of absence

under a plan provided by the separating employer” (Ind.

8

Code Ann. § 22-4-15-1 (Burns 1974)). As the District

Court correctly realized.

... Indiana creates no blanket presumption. The

system merely assumes that if a woman terminates

her employment because of pregnancy it is done

voluntarily and without good cause. It is hard to

conceive of a more reasonable basis upon which the

Indiana legislature could have excluded pregnancy,

an action which it is constitutionally permitted to

make.

Because the invalidated statutes did not prescribe any

period of unemployment and did not conclusively presume

incapacitation, the Seventh Circuit erred in applying

Turner to them. Instead, the applicable cases are Nash-

ville Gas Co. v. Satty, 434 U.S. 136 (1977), General Electric

Co. v. Gilbert, 429 U.S. 125 (1976), and Geduldig v. Aiello,

417 U.S. 484 (1974), which upheld similar pregnancy-ex-

cluding programs attacked on statutory and constitutional

grounds

The results of the Seventh Circuit’s error could have far

reaching effects. Respondents, in District Court, sought

certification of a class composed of all persons, separated

from work because of pregnancy, who did not receive

unemployment compensation for the period of separation.

One of the statutes at issue, Ind. Code § 22-4-14-3 (Burns

1974) was enacted in 1947 and partly repealed in 1975;

the other, Ind. Code § 22-4-15-1 (Burns 1974) was

amended to include the relevant portions in 1967 and

1971, and then partly repealed in 1977. ~

There is uncertainty as to the proper application of the

Aiello-Gilbert-Satty and the LaFleur-Turner lines of cases,

as is demonstrated by the opposite results reached by the

District Court, in its two written opinions, and the Sev-

enth Circuit, in the sentence quoted supra, at page 6. The

resolution of this uncertainty will influence the lives and

finances of many persons, including those who seek unem-

ployment benefits, those who contribute to the fund, and

the State of Indiana. If the District Court certifies a class

as a result of the remand order, then the State will be

forced to search unemployment records going back nearly

thirty years, all as a result of the erroneous decision of the

9

Seventh Circuit which is contrary to applicable decisions

of this court.

CONCLUSION

For these reasons, a writ of certiorari should issue to

review the opinion and judgment of the Seventh Circuit.

Respectfully submitted,

THEODORE L. SENDAK

Attorney General of Indiana

DONALD P. BOGARD

Chief Counsel-Staff

Office of the Attorney General

219 State House

Indianapolis, Indiana 46204

Telephone: (317) 232-6217

Attorneys for Petitioner.

APPENDIX

IN THE

UNITED STATES COURT OF APPEALS

FOR THE SEVENTH CIRCUIT

No. 78-2548

INTERNATIONAL Union, Unrrep AUTOMOBILE,

Arrospace AND AGRICULTURAL IMPLEMENT

Workers Or America, UAW, et al.,

Plaintiff-Appellants,

v.

Tue Inpiana Emptoyment Securrry Boarp, et al.,

Defendant-Appellees.

Appeal from the United States District Court for the

Southern District of Indiana, Indianapolis Division.

No. IP 76-705-C — S. Hucu Diy, Judge.

Arcuep Aprit 25, 1979 — Decwwep June 22, 1979

Before Swycert, Circuit Judge, Moore, Senior Circuit

Judge,* and Tong, Circuit Judge.

Tone, Circuit Judge. The issue in this case is the con-

stitutionality of Indiana statutory provisions, now re-

pealed, that denied unemployment compensation to

women who were willing and able to work but were denied

the opportunity to do so because of pregnancy. We hold

these, provisions unconstitutional and reverse the district

court’s judgment to the contrary.

* The Honorable Leonard P. Moore, Senior Circuit Judge of the United

States Court of Appeals for the Second Circuit, is sitting by designation.

A-1

A-2

The plaintiff union brought the action both as an

employer-contributor to an employment compensation

fund governed by the Indiana Employment Security Act,

Ind. Code Ann. § 22-4-1-1, et seq. (Burns), and on behalf of

those of its members denied compensation from the fund

because of the challenged statutory provisions. In addi-

tion, five individual plaintiffs assert claims for un-

employment compensation and also seek to represent a

class of all women similarly situated. The defendants are

Indiana officials responsible for administering the Act.

Proceeding under 42 U.S.C. § 1983, plaintiffs claim that

the provisions in question violate the Fourteenth Amend-

ment. Other alleged bases of jurisdiction and theories of

invalidity need not concern us. The district court dismis-

sed the action for failure to state a claim on which relief

can be granted without determining whether the action

should proceed as a class action.

The Indiana Employment Security Act provides for the

payment of unemployment compensation benefits to un-

employed persons who are able to work, available for

work, and making an effort to obtain work, and who have

neither left their previous place of employment voluntari-

ly without good cause attributable to the employer nor

been discharged for misconduct in connection with work.

Ind. Code Ann. §§ 22-4-14-1 through 22-4-14-7 and

92-4-15-1 through 22-4-15-8 (Burns). The provisions

challenged in this case provided that if an “individual’s

unemployment is due to pregnancy” she would be deemed

unavailable for work and therefore ineligible to receive

benefits, former § 22-4-14-3(d),’ repealed in relevant part,

Pub. L. 253, § 1 (1975), and that a woman separated from

employment “because of pregnancy” was disqualified from

1 Ind. Code Ann. § 22-4-14-3(d) (Burns) read in relevant part:

An unemployed individual shall be eligible to receive benefits with

respect to any week only if he is physically and mentally able to

work, is available for work and is found by the division to be

making an effort to secure work... For the purpose of this article

[22-4-1 — 22-4-38-38], unavailability for work of an individual

shall be deemed to exist but shal] not be limited to, any case in

which, with respect to any week, it is found .. .

(d) That such individual’s unemployment is due to pregnancy.

A-3

receiving unemployment benefits, § 22-4-15-1,?

: ’ = -i,” re l

in —— part, Pub. L. 262, § 25 (1977). The bane

reer ae in the case at bar alleges that at least one of the

ividual plaintiffs was denied unemployment benefits on

vr: a soyond others, of her pregnancy and that

ee s not even allowed to file a claim because of her

As we view the case, it falls ithi

; squarely within Tur

aoe uaa of Employment Security of Utah, 423 US. 44

Patina has pier hapa epg under the Fourteenth

Ament statu at made “

i for unemployment benefits for A ld diehaod-

ee. : , 12 weeks before the expected date of childbirth

pougy ig six weeks after childbirth.” Jd. In so holding

bret aes : te kes tered Board of Education v.

q ‘S. . Regardless of th

Trajele A the irrebuttable presumption oka, ees

Trafelet Thompson, 594 F.2d 623, 629-630 (7th Cir.

2 i oe of course bound to follow the Turner holding.

pcr ringed that denies unemployment benefits to all

- rt who are unemployed because of pregnancy without

g to whether individual pregnant women have the

? Ind. Code Ann. § 22-4-15-1 (Burns) read in relevant part:

‘96T wad ea te en ges magne subsequent to July 1

uly 4, , other provisions of thi icle

apts o 22-4-38-3] notwithstanding, an individual shall be

eto oh r any waiting period or benefit rights based upon wages

aed Sead any employer whose employ he has left voluntarily

wig ty Parole ges to be employer or from which he

or misconduct in connection with hi

work: ... Provided, further, however, Th veg ;

, ther, , That the

paragraph shall be subject to the following aeaien ee

... (2) Separation from employment because of pregnancy shall

be construed ithi i :

oe as within the purview of the disqualification provided

The disqualifications provided i i :

the following a adinedeee ‘ : in this section shall be subject to

(4) An individual who is se

( parated from employment beca f

pata ad aglhgeiner ny to fog pa an under this ‘aihion

y for or to accept a |

ie pen provided by the separating Bese ide ee

e iana legisjature amended § 22-4-15-1 i

' -4-15-1 to include the fi

at ne quoted above in 1967, Ind. Acts. ch. 310 § 19; it ote rs

nd quoted paragraph in 1971, Pub. L. 355 § 35. g

A-4

physical capacity to continue work is invalid under that

holding.

Indeed, counsel for defendants has recognized the au-

thority of Turner in his ora argument and his brief,

although in the latter a desultory reference is made to

Gelduldig v. Aiello, 417 U.S. 484 (1974), General Electric

Co. v. Gilbert, 429 U.S. 125 (1976), and Nashville Gas Co.

v. Satty, 434 U.S. 136 (1977), as cases “this case should

follow.” Counsel’s only attempt to distinguish Turner is

his argument that the challenged Indiana statutory provi-

sions “do not deny the woman a chance to show that she is

able and willing to work,” and that “only women who are

unable or unwilling to work because of pregnancy are

denied benefits.” This argument simply ignores the un-

equivocal statutory declarations that “unavailability for

work of an individual shall be deemed to exist... [in] any

case in which... it is found... [t]hat such individual’s

unemployment is due to pregnancy,” see note 1, supra, and

that “[sleparation from employment because of pregnancy

shall be construed as within the purview of the disqualifi-

cation provided” with respect to individuals who left their

employment voluntarily without good cause attributable

to the employer or who were discharged for misconduct,

see note 2, supra. When the defendants’ attempt to distort

the statutory language is disposed of, nothing is left of

their argument and Turner plainly controls.

The judgment is reversed and the case is remanded to

the district court with directions to determine whether it

should proceed as a class action and for further proceed-

ings consistent with this opinion.

_ Reversep AnD REMANDED.

A true Copy:

Teste:

Clerk of the United States Court of

Appeals for the Seventh Circuit

IN THE

UNITED STATES DISTRICT COURT FOR THE

SOUTHERN DISTRICT OF INDIANA,

INDIANAPOLIS DIVISION

No. IP 76-705-C

INTERNATIONAL UNION, UNITED AUTOMOBILE

AEROSPACE AND AGRICULTURAL IMPLEMENT

WORKERS OF AMERICA, UAW, et al.,

Plaintiffs,

Vv.

igs INDIANA EMPLOYMENT SECURITY BOARD,

et al.,

Defendants.

August 10, 1978

S. Hugh Dillin, Judge

MEMORANDUM OF DECISION

This case comes before the Court on three motions.

Plaintiffs move in the first instance to amend the com-

plaint a second time. Plaintiffs also seek a determination

that the cause be maintained as a class action.

Defendants move the Court for dismissal, alleging lack

of subject matter jurisdiction, failure to state a claim upon

which relief can be granted, failure to join indispensable

parties, and bar by virtue of the doctrine of Sovereign

Immunity and the Eleventh Amendment of the Uni

States Constitution. areas

Plaintiffs’ Amended Motion to Amend

The second amended complaint does not alter the sub-

stance of the alleged cause of action, and defendants do not

show prejudice in their opposing memorandum.

A-6

Plaintiffs’ amended motion to file a second amended

complaint is therefore granted.

Defendants’ Motion to Dismiss

Defendants’ motion to dismiss addressed the first

amended complaint. Because the two amended complaints

are identical in substance, the motion to dismiss will be

treated as responsive to the second complaint.

Plaintiffs maintain that they have been denied unem-

ployment benefits under the Indiana Employment Securi-

ty Act in a sexually discriminatory manner. All plaintiffs

are alleged to have been separated from their employment

due to pregnancy and without cause. Plaintiffs Baker,

Robbins and Kuntz did not apply for unemployment bene-

fits because of the statute in question and because of the

policies of defendants in applying the statutes. Plaintiff

Kubisiak attempted to apply for benefits but was not

re to do so. Plaintiff Blocher did apply but was

eftred benefits.

Two statutory sections are challenged. The first reads in

relevant part:

* _. unavailability for work of an individual shall

be deemed to exist... when it is found... that

such individual’s unemployment is due to preg-

nancy....” LC. 22-4-14-3.

The above language was deleted from the section in 1975.

P.L. 253 (1975).

The second reads as follows insofar as is relevant to this

discussion:

“Separation from employment because of pregnan-

cy shall be construed as within the purview of the

disqualification [from eligibility for unemploy-

ment compensation benefits on the ground that

the applicant left her job voluntarily and without

good cause] provided herein....” LC. 22-4-15-1.

That language has also been repealed. P.L. 262 (1977).

Thus, insofar as plaintiffs seek a declaration regarding

the statutory sections, the issue is moot and requires no

decision.

A-7

The question remains as to the entitlement of plaintiffs

to back unemployment benefits denied them under the old

sections 22-4-14-3 and 22-4-15-1. It is the opinion of this

Court that plaintiffs are not so entitled.

The United States Supreme Court has spoken three

times to the issue of unemployment compensation systems

which deny benefits to women who stop work as a result of

pregnancy.

The cause of Geduldig v. Aiello, 41 L.Ed.2d 256 (1974),

is on point. In that case, the California disability insur-

ance system was challenged insofar as it excluded from

coverage certain pregnancy related disabilities. The Court

upheld the California system, stating that exclusion of the

disabilities was not “invidious discrimination under the

Equal Protection Clause.” 41 L.Ed.2d at 263.

A similar though not identical situation was addressed

in General Electric Co. vs. Gilbert, 50 L.Ed.2d 343 (1976).

The contention was that denial of benefits to pregnant

women under an employer’s disability plan ran contrary to

Title VII of the Civil Rights Act of 1964. The Court stated

explicitly that the Geduldig case, which arose under a

Fourteenth Amendment claim, was relevant to resolving

the Title VII question in Gilbert. The Court applied the

Geduldig reasoning and again held that exclusion of preg-

nancy benefits is not discrimination based on sex unless

the exclusion is shown to be a mere pretext “‘designed to

effect an invidious discrimination against the members of

one sex or the other.” 50 L.Ed.2d at 354 (quoting Gedul-

dig). The non-discriminatory distinction must be shown to

be a subterfuge. At 354.

Most recently, in the case of Nashville Gas v. Satty, 46

L.W. 4026 (1977), the Court dealt with another employer

funded disability plan. Plaintiff was forced by her employ-

er to leave work and was denied sick pay normally pro-

vided by the employer for nonoccupational sickness or

injury. The Court found the sick pay system used by

Nashville Gas to be indistinguishable from the insurance

plan in Gilbert, and upheld the system based on the fact

that plaintiff had not shown that the plan was used as a

pretext for invidious sex discrimination. 46 L.W. at 4028.

A-8

The Indiana Employment Security Act is arguably dis-

tinguishable from either an employer or state operated

disability insurance plan because it is designed to remedy

economic insecurity resulting from mere unemployment,

rather than to compensate disabilities which are related to

unemployment. See I.C. 22-4-1-1, et seq. er

A person may be disqualified for benefits underthe Act

if she is discharged “with just cause” or if she leaves the

job “voluntarily without good cause.” See I.C. 22-4-15-1.

Under the now deleted language of Section 22-4-15-1,

unemployment by reason of pregnancy was deemed au-

tomatically to be departure without good cause or termi-

nation with just cause.

The relevant inquiry is therefore whether the Indiana

system, which is to remedy mere lack of work, is suffi-

ciently different from the systems in the Geduldig, Gilbert

and Satty cases such as to command a different result.

This Court believes that it is not. Indiana’s unemploy-

ment compensation system is financed by employer con-

tributions. Like*the other three systems, it is designed to

compensate for loss occasioned by a given set of risks.

Some risks are specifically excluded. For example, persons

who are physically unable to work are not eligible for

compensation. I.C. 22-4-14-3. Ostensibly, compensation

for pregnancy related disability and lost pay could be

undertaken by individual employers in their own work-

men’s compensation packages. However, neither the state

nor private employers are constitutionally required to do

so. As Justice Rehnquist stated in Gilbert:

“Absent a showing that distinction involving preg-

nancy are mere pretexts designed to effjct an

invidious discrimination against the members of

one sex or the other, lawmakers are constitution-

ally free to include or exclude pregnancy from the

coverage of legislation ...on any reasonable basis,

just as with respect to any other physical condi-

tion.” 50 L.Ed.2d at 353.

Plaintiffs do not allege that the language previously in

the Indiana statute operated as a pretext for invidious

discrimination based on sex.

A-9

For the foregoing reasons, plaintiffs have failed to state

a claim upon which relief can be granted. Defendants’

motion to dismiss is hereby granted.

This decision renders unnecessary the resolution of

plaintiffs’ motion for determination as a class action and of

the other grounds for dismissal alleged by defendants.

A-10

IN THE

UNITED STATES DISTRICT COURT FOR THE

SOUTHERN DISTRICT OF INDIANA,

INDIANAPOLIS DIVISION

No. IP 76-705-C

ILE

INTERNATIONAL UNION, UNITED AUTOMOBILE,

AEROSPACE AND AGRICULTURAL IMPLEMENT

RICA, UAW, et al.,

WORKERS OF AME Plaintiffs,

UV.

THE INDIANA EMPLOYMENT SECURITY BOARD,

— Defendants.

October 27, 1978

S. Hugh Dillin, Judge

ENTRY

his case is before the Court on plaintiffs’ motion to

i or amend and to reconsider the judgment entered on

August 10, 1978. Plaintiffs contend that the Couft gre 2

plied Geduldig v. Aiello, 417 USS. 484, 41 L.Ed.2d :

(1974); General Electric v. Gilbert, 429 US. 126; :5

L.Ed.2d 343 (1976), and Nashville Gas Co. v. Satty, —

US. , 54 L.Ed.2d 356 (1978). Plaintiffs also maintain

that since the Indiana Employment Security Act has led to

a denial of benefits in a sexually discriminatory manner

and has created an unjustified conclusive presumption in

violation of the Fourteenth Amendment’s Due Process

Clause, the cases of Turner v. Department of Employment

Security, 423 U.S. 44, 46 L.Ed.2d 181 (1975), and Cleve-

A-11

land Board of Education v. LaFleur, 414 U.S. 632, 39

L.Ed.2d 52 (1974), shouid have been applied. Plaintiffs

state that the proper inquiry is whether the Indiana sys-

tem is sufficiently different from the systems in Turner

and LaFleur, and not whether the Indiana system is suffi-

ciently different from the systems in Geduldig, Gilbert and

Satty to command a different result.

Discussion

Plaintiffs’ reliance on Turner and LaFleur is in error. In

LaFleur the school board had a rule that a pregnant

teacher must take a mandatory maternity leave beginning

five months before the expected birth. The teacher was

required to give notice of her pregnancy at least two weeks

prior to the time she was to begin her maternity leave.

The teacher would not become eligible for reemployment

until the beginning of the next school semester after her

child was three months old, provided a physician issued a

certificate attesting to the teacher’s health. Justice Stew-

art, speaking for five members of the Court, said that the

mandatory employment termination provisions contained

in the maternity leave rule were violative of the Due

Process Clause of the Fourteenth Amendment for two

reasons. First, the rule swept too broadly in implementing

both the school board’s interest in continuity of instruction

and the state’s interest in keeping physically unfit

teachers out of the classroom. Second, the rule’s conclusive

presumption that every pregnant teacher who reached the

fifth or sixth month of pregnancy was physically incapable

of continuing her job is neither necessarily nor universally

true. 414 U.S. at 648, 39 L.Ed.2d at 64.

Turner involved a Utah statute which created a conclu-

sive presumption that women are unable to work during a

period of approximately eighteen weeks, extending from

twelve weeks before the expected date of childbirth until

six weeks after childbirth. In Turner the petitioner was

separated from her employment for reasons unrelated to

her pregnancy. She received unemployment benefits ex-

cept for the eighteen week period as provided in the

statute. The state’s highest court had construed the stat-

ute as creating a conclusive presumption that women are

unable to work during that eighteen week period. The

A-12

United States Supreme Court held that the statute viol-

ated the Due Process Clause of the Fourteenth Amend-

ment since it could not be doubted that a substantial

number of women are fully capable of working well into

their last trimester of pregnancy and of resuming em-

ployment shortly after childbirth. 423 U.S. at 45-46, 46

L.Ed.2d at 183-184. The Fourteenth Amendment, the

Court said, requires that unemployment compensation

boards must achieve legitimate state ends through more

individualized means when basic human liberties are at

stake. 423 U.S. at 46, 46 L.Ed.2d at 184.

It is clear that the Indiana system is significantly differ-

ent from those discussed in Turner and LaFleur. The

Indiana statute, since repealed, created no presumption of

a pregnant woman’s inability to work. A pregnant woman

was disqualified from eligibility for unemployment com-

pensation benefits on the ground that she had left her job

voluntarily and without good cause. Thus the presumption

created is not one of disability but one of voluntariness or

the absence of good cause. It is this point which distin-

guishes the Indiana system from the systems struck down

in Turner and LaFleur. In a Turner-type situation in

Indiana, a pregnant woman would likely continue to re-

ceive benefits throughout the pregnancy so long as she

was available for work within the meaning of the statute.

However, if her condition made her unavailable for work

she would, of course, be denied benefits.

Therefore, the Court must conclude, as it did in its

decision of August 10, 1978, that the Indiana system is

similar to those upheld in Geduldig, Gilbert and Satty. The

state is free to exclude pregnancy from the coverage of

legislation on any reasonable basis, just as it may exclude

any other physical condition. Gilbert, supra. Indiana

creates no blanket presumption. The system merely as-

sumes that if a woman terminates her employment be-

cause of pregnancy it is done voluntarily and without good

cause. It is hard to conceive of a more reasonable basis

upon which the Indiana legislature could have excluded

pregnancy, an action which it is constitutionally permitted

to make.

For the foregoing reasons, plaintiffs have failed to per-

suade the Court that its original decision was improper.

A-13

Plaintiffs’ motion to alter or amend the judgment and for

reconsideration is hereby denied.