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Rosen v. Public Service Electric and Gas Co.

UNITED STATES COURT OF APPEALS, THIRD CIRCUIT.


January 30, 1976

LEO ROSEN ET AL., APPELLANTS
v.
PUBLIC SERVICE ELECTRIC AND GAS COMPANY, APPELLEE. MORGAN SWEENEY ET AL., APPELLANTS V. SAME.

On Appeal from United States District Court, District of New Jersey.

Before VAN DUSEN, ADAMS and WEIS, Circuit Judges.

Per Curiam: The principal issue in this appeal is whether the damages awarded by the district court to the plaintiffs, former male employees of a public utility, for violation Rights Act were calculated in accord with our previous decision in this case.*fn1

Public Service Electric and Gas Company (Public Service), the defendant, has maintained a pension plan for its employees since 1911. Benefits were based upon an employee's average annual salary for the five years of highest earnings in the last ten years of employment, and upon the total number of years of service with the company. Under the terms of the plan in effect in 1965, pension benefits of employees who retired before attaining "normal, retirement age" - 65, in the case of men, or 60, in the case of women - were reduced according to a stated formula. The critical factor in the formula determining the extent of the decrease in the benefit payments was the number of months remaining, at the time of retirement, until the employee reached "normal retirement age." For each additional month by which the employee's age upon his or her actual retirement fell short of the "normal retirement age," the loss of pension payments increased.

Because the "normal retirement age" for women was less than that for men, the result was that pension payments could differ for a man and a woman who retired at the same age, with the same average salary, and after the same number of years of employment. For example, if a man and a woman identically situated with regard to salary and tenure both retired at age 61, the man's pension would be reduced, since he was retiring four years before the "normal retirement age" for males. The woman would suffer no loss in her pension allowance, however, since she had already passed the "normal retirement age" for females. Consequently, the result would be a higher pension for the woman.

Title VII of the Civil Rights Act of 1964,*fn2 which prohibits discrimination in employment on the basis of several attributes, including gender, went into effect on July 2, 1965. Thereafter, in order to remedy the inequities they perceived in the pension situation, several male employees and their collective bargaining representative brought employment discrimination charges against Public Service.

Subsequent to the filing of the suit in the district court, Public Service amended its pension plan. The new plan, effective May 1, 1967, eliminated the disparity in the "normal retirement age" for men and women, making the age 65 for both, and retained an arrangement for reducing the pension allotments of any employee who retired before reaching age 65. A sort of grandmother clause in the amended plan provided that women who retired early would not be penalized in the calculation of their pensions for employment prior to the date the modified plan came into force. There was no such clause formen.

The plaintiffs amended their complaint to include an allegation that the new plan also violated Title VII, in that it discriminated against males who retired after Title VII became effective. The district court granted summary judgment in favor of Public Service on the grounds that the challenge to the first plan was moot, since it had been superseded by the amended plan, and that no charge had been filed with the Equal Employment Opportunity Commission regarding the second plan. This Court vacated that judgment and remanded for a determination whether Title VII was violated by either plan.*fn3 On remand, the district court found that both versions of the pension plan transgressed Title VII because of their impact on male employees.*fn4 The district court therefore ordered Public Service to cease and desist from discriminating between men and women, but it refused to award damages.*fn5 We affirmed the finding of a violation of the statute, but held that an award of damages was required. The case was once again returned to the district court, this time for a determination of damages.*fn6 In the opinion remanding the case, this Court added the specific caveat that "the retirement credit of males... must be increased for the relevant period between July 2, 1965 and May 1, 1967."*fn7

Following that instruction, the district court held that an adjustment was required in the pension benefits due the male employees for work performed during the twenty-two month period between July 2, 1965 and May 1, 1967. Damages were assessed on the basis of that equalization proviso. The district court stated that the clear language of the Court of Appeals foreclosed it from considering the plaintiffs' contention that the necessary adjustment was one that would require equalized pension benefits for all years of service with the company to be given to every male employee who retired during the relevant twenty-two-month period.*fn8 The district court thus fashioned a grandfather clause for male employees corresponding to the grandmother clause that the amended pension plan made applicable to women. However, the judge ruled that the reach of the grandfather clause had to be limited to the twenty-two-month period between July 2, 1965 and May 1, 1967. No such limitation applied to the grandmother clause, which was based upon the pension rights vested in the women employees. The plaintiffs in essence urged the district court to create a grandfather clause that similarly had no time limitation.

The ruling by a panel of this Court that the plaintiffs' pension payments had to be increased for work performed during the interval between the effective date of Title VII and that of the modified pension plan became the law of the case.*fn9 It bound the district court on remand, and controls the decision in this appeal. A review of the record that was before the panel that decided the previous appeal and an analysis of the language used in its opinion demonstrated that the district court faithfully executed the panel's instructions regarding the calculation of damages.

Plaintiffs have been awarded attorneys' fees, as authorized by Title VII, for legal services in the district court.*fn10 They now request fees for work performed before this Court in the present appeal and the previous one.*fn11 Congress has mandated that only the "prevailing party" may be awarded an attorneys' fee. The plaintiffs may therefore recover a fee only for services performed in connection with an appeal in which they prevailed. Plaintiffs' counsel has represented that he spent 46 hours working on the last appeal, and the parties have stipulated that $60 per hour is the suitable rate of payment. An attorneys' fee of $2,760 is thus appropriate.*fn12

The judgment of the district court will be affirmed, an attorneys' fee of $2,760 will be awarded the plaintiffs, and costs will be taxed against the defendant.


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