would breach the duty of fair representation it owes to its members, would constitute a failure to enforce the anti-discrimination provisions of its collective bargaining agreements, and would leave it vulnerable to charges that it had actively participated in or passively accepted discriminatory practices that violate federal law.
In its prayer for relief, the Alliance asks that the Consent Decree be modified to provide that: (1) transfers and promotions by the operating companies be made in accordance with the relevant collective bargaining agreements and the past practices of the parties under those agreements, and without granting preferential treatment to any individual or group on the basis of their race, color, religion, sex or national origin; (2) maternity leave be treated like any other absence for temporary disability in the computation of seniority under those collective bargaining agreements and under the employee benefit plans of the operating companies; (3) the Decree not be construed to demand the imposition of time-in-title requirements for transfer and promotion; and (4) no employee of the operating companies be disqualified from transfer or promotion for failure to pass a Bell System Qualification Test that is not directly related to the job for which transfer or promotion is sought.
4. The Claims of the Government Plaintiffs and AT&T
A. The Interim Report
In support of their joint motion to enter the proposed Supplemental Order, the Government plaintiffs and AT&T filed an Interim Report on the implementation of the Consent Decree. The report states that, after the entry of the decree, the plaintiffs established a Government Co-ordinating Committee (GCC), AT&T enlarged its Human Resources Development Department (HRD), and the GCC and the HRD worked together to assure defendants' compliance with the decree. The report further states that while numerous problems were encountered in 1973, in particular the development of a suitable compliance procedure, the defendant operating companies made substantial progress in fulfilling their obligations under the decree. Nevertheless, the GCC determined that, on the basis of reports submitted to it and of its own on-site reviews, many of the operating companies had not met their intermediate targets for the placement of members of previously under-utilized groups. The GCC attributed these deficiencies to (1) ineffective management control of the program in some operating companies; (2) initially inefficient monitoring procedures; (3) insufficient use by the defendants of the affirmative action override,
(4) inadequate recruitment efforts among previously under-utilized groups; and (5) the failure to adopt the alternate selection procedures where test disqualifications of job applicants from under-utilized minority groups had made it more difficult to meet intermediate employment targets for such groups.
During discussions with the defendants of methods to improve on their 1973 performance, the GCC reviewed their compliance with the decree in 1974 and found it significantly improved, 90% of the 1974 intermediate targets having been achieved by the defendant operating companies. The GCC therefore concluded that no on-site reviews were required to monitor the defendants' 1974 performance. The Government plaintiffs and AT&T then agreed upon a supplemental action program in which target performances for 1973, 1974 and part of 1975 would be aggregated.
This supplemental action program included two adjustments in 1973 target performance. Given the unanticipated difficulties encountered by the operating companies in placing women in outside craft jobs, the parties agreed that performance for such placements would be evaluated on the basis of the acknowledged good faith efforts made by certain operating companies to achieve those targets. The parties also agreed that in the present state of the economy an affirmative action program should not provide a disproportionate number of job opportunities to individuals who are not members of minority groups. The 1973 and 1974 targets in certain job classifications were therefore adjusted to provide comparable opportunities for both minority and non-minority employees and applicants.
At the close of this Interim Report, the government plaintiffs and AT&T jointly moved the Court to enter the proposed Supplemental Order pursuant to its retained jurisdiction under Part B, Section IV, Paragraph A of the Consent Decree.
B. The Proposed Supplemental Order
The Proposed Supplemental Order (hereinafter "PSO") includes carry forward provisions to correct previous deficiencies; provisions for financial compensation to specific individuals and for financial contributions by the defendants to a Bell System Affirmative Action Fund, along with examples of the projects to which the fund may be applied; provisions to compensate for test disqualifications of otherwise qualified candidates for job opportunities; an articulation of the affirmative action override, of the situations in which the defendants shall employ it, and of the steps to be taken if the override is modified in any way by the courts; provisions stating the effect of the PSO, including its impact on any Bell Company's collective bargaining agreements; provisions for the determination of compliance with the PSO; provisions setting forth procedures for compliance with the PSO; provisions for record-keeping by the defendants and for their reporting to the Government plaintiffs under the Consent Decree and the PSO; and, finally, a provision setting forth the effective term of the PSO. The PSO also incorporates three appendices: Appendix A sets forth the operating companies' deficiencies for 1973 and 1974, and the method by which the deficiencies were determined; Appendix B lists the actions the operating companies must take in order to comply with their obligation to make good faith efforts to place women in certain non-traditional jobs; Appendix C is a letter, dated May 6, 1975, from the Government plaintiffs to the defendants, describing the operation of the affirmative action override and stating that its use is required by federal law and that it prevails over any conflicting provision of a Bell System collective bargaining agreement.
For purposes of the petitions and motions presently before the Court, the most important provisions of the PSO are Part I, the carry forward procedure, and Part IV, the affirmative action override. Part I.A provides for the proration by job classification of 1973 deficiencies in performance to establishments that were themselves deficient in placing members of protected race, sex, and ethnic groups in the appropriate job classifications during 1973. Part I.B, insofar as it concerns us here, spells out a placement procedure for non-management employees and applicants in job classifications 5-15 for those establishments that did not meet their 1973 targets. Under this procedure, employees or applicants from deficient groups will receive priority in placement if they had on file in 1973 an application for employment, upgrade or transfer for the same job title they now seek,
if they have not yet received an offer of employment in response to that application and are currently available for employment or assignment, and if they are qualified for the job that is open.
Part I.B of the PSO states further that in any calendar quarter where the process of priority placement described above fills less than 50% of the deficiencies in a particular establishment's deficient (classifications), additional qualified employees or applicants from the deficient (groups) will receive priority placement until the total number of priority placements equals 50% of the deficiencies at the start of the quarter or 50% of the projected job opportunities for the quarter, or until the deficient group achieves its ultimate employment goal under the decree. Should deficiencies continue in a particular establishment where the pools of qualified employees or applicants from deficient groups identified above have been exhausted, each race, sex or ethnic group that is still deficient will share proportionately in the remaining job opportunities, subject to certain limitations not relevant here. Part I.B additionally provides for the termination of the carry forward procedure when a formerly deficient group reaches ultimate goal, and directs the operating companies to notify the Government plaintiffs whenever, in a particular calendar quarter, placements to groups at ultimate goal exceed one-third of the placements in a job classification with deficiencies. Part I.C. of the PSO directs all defendants with carry forward obligations to make all placements in accordance with the Part I.B procedures. Where there are no deficiencies or where they have been eliminated, the defendants must make placements in accordance with goals II percentage allocations. Part I.D of the PSO directs operating companies to make all placements for a specified time period -- from shortly after the entry of the PSO until the effective date of the carry forward procedures -- from deficient groups, to the extent that qualified members of those groups are available or until the deficiencies are eliminated. Finally, Part I.E of the PSO provides that an operating company which has, for two consecutive calendar quarters, made more than one-third of its placements in a particular job classification to groups at ultimate goal may petition the Government plaintiffs and, eventually, this Court for a reduction of the remaining deficiencies in that job classification.
Part IV of the PSO sets forth the affirmative action override. In pertinent part, it provides that, while contractual criteria for the selection of candidates for promotion remain generally in effect, "to the extent any Bell System operating company is unable to meet its intermediate targets in job classifications 5 - 15 using these criteria, the Decree requires that . . . selections be made from among any at least basically qualified candidates for promotion and hiring of the group or groups for which the target is not being met and in accordance with any applicable selection criteria in a collective bargaining agreement or pursuant to Bell System operating company practices as among such candidates."
Part IV further provides that "Bell System Companies shall employ the affirmative action override described . . . above, in any job classification and establishment (a) at any point in a quarter when they conclude that such use is necessary to meet intermediate targets or (b) in quarters following the end of any quarter when a Company is failing to meet any intermediate target in such classification and establishment and until such target is being met for the year."
THE MERITS OF THE PETITIONS TO MODIFY OR SUPPLEMENT THE CONSENT DECREE
A. Preliminary Considerations
1. Promotions and Seniority
in the Bell System.
While I fully realize the importance of seniority to union members, privileges based upon it have not yet acquired the status of constitutional rights. An examination of Bell System employment practices makes this abundantly clear. In the Bell System, management makes all the hiring decisions, Affidavit of Richard W. Hackler, Doc. #88, para. 10, and AT&T's overriding policy has traditionally been that "management retains the prerogative to transfer and promote consistent with the needs of the business." Id., para. 4. Thus, in the relevant collective bargaining agreements, there is no absolute entitlement based on seniority. See Affidavit of Oliver R. Taylor, Doc. #86, Appendix VI, para. 4. Seniority is one, but not the only, consideration in transfers and promotions; it usually functions as "a method of selecting between candidates of equal or approximately equal qualifications." Hackler Affidavit, Doc. #88, para. 4. More specifically, the role of seniority in filling vacancies in Bell System operating companies is as follows:
"Among employees competing for promotion opportunities, the standard calls for selection of the best qualified employee and for consideration of net credited service (company-wide seniority). Where qualifications are substantially equal, net credited service governs."
Doc. #75, at 7, and Attachment III; see Doc. #77, at 5.
The CWA has described this "best qualifications" criterion for filling vacancies as governed by the subjective judgment of management. See Doc. #65, at 8; Doc. #77, at 6.
The intervenors' horror at an override of seniority would lead one to believe that it is an unprecedented departure from past practices within the Bell System. It is not. Consistent with the very collective bargaining agreements that intervenors claim are violated by the override, the defendants have always had the authority to fill, and have from time to time filled, vacancies in jobs above the entry level with new hires or with better qualified, low seniority employees, even though employees with greater seniority were by-passed in the process. Affidavit of Oliver R. Taylor, Doc. #86, Appendix VI, para. 4. This practice was, in essence, a seniority override for reasons of business efficiency. In the instant case, the seniority override is used for a far more important and compelling purpose, the implementation of a significant national policy, the assurance of equality of employment opportunity, as expressed by the national legislature in Title VII and by the national executive in Executive Order No. 11246.
B. Agency Interpretations
The EEOC, the agency charged with the enforcement of Title VII, and the Department of Labor, the agency charged with the implementation of Executive Order No. 11246, are parties to the Consent Decree and the Proposed Supplemental Order. Obviously, they judge the relief provided in the decree and the proposed order to be fully consistent with Title VII and the executive order respectively, and their judgments should not be lightly disregarded by the courts. As the Supreme Court has said, referring specifically to the EEOC, "the administrative interpretation of the Act by the enforcing agency is entitled to great deference." Griggs v. Duke Power Company, 401 U.S. 424, 433-34, 28 L. Ed. 2d 158, 91 S. Ct. 849 (1971). The court of appeals for this circuit has stated that the Labor Department's interpretation of Executive Order No. 11246 should be accorded similar respect. Contractors Association of Eastern Pennsylvania v. Secretary of Labor, 442 F.2d 159, 175 (3d Cir.), cert. denied, 404 U.S. 854, 30 L. Ed. 2d 95, 92 S. Ct. 98 (1971). While neither of these agency interpretations completely forecloses judicial inquiry into the validity of the Consent Decree and the Proposed Supplemental Order, they nevertheless weigh heavily in support of a finding that both the decree and the proposed order are proper exercises of this Court's remedial powers.
C. The Evidentiary Posture of the Case
Because the defendant-intervenors challenge a consent decree and its implementation, the instant case comes before the Court in an unusual evidentiary posture. In their complaint, the government plaintiffs alleged that AT&T had discriminated against women and minority employees in promotions and transfers by a variety of policies and practices. See Doc. #1, para. 14, (a)-(g). According to the government, AT&T's vaguely defined transfer and promotion procedures were not made known to women and minority employees; women and minority employees were placed in job categories where there were disproportionately limited opportunities for upward mobility and advancement as compared to jobs staffed predominately by Caucasian males; AT&T did not provide women and minority employees with equal opportunities for training as compared with Caucasian males; AT&T failed to promote women and minority employees in non-management job categories at a rate comparable to Caucasian males; AT&T preferred new hires over current employees seeking to transfer to higher-paying non-management jobs; AT&T failed to promote women and minority employees into management jobs at a rate comparable to Caucasian males; and AT&T used "net credited service" to determine lay-off and recall rights to the disadvantage of women and minority employees. In its answer, filed the same day, AT&T denied each of these allegations in their totality except the last, and then denied that its use of "net credited service" to determine lay-off and recall rights had in fact disadvantaged women and minority employees. Answer of AT&T, Fourth Defense, Doc. #2, at 4. Still on the same day, January 18, 1973, the parties entered into a consent decree which provided for extensive changes in AT&T's promotion and transfer policies. That consent decree, however, stated that its provisions constituted neither an admission by the defendants nor a finding by this Court that the defendants had in fact discriminated against women and minority employees as the complaint alleged. See Consent Decree, Doc. #3, at 1-2.
To achieve the equality of employment opportunity that is the goal of Title VII, Congress selected cooperation and voluntary compliance as "the preferred means." Alexander v. Gardner-Denver Company, 415 U.S. 36, 44, 39 L. Ed. 2d 147, 94 S. Ct. 1011 (1974). That these "preferred means" might be used effectively, it created the EEOC and established procedures by which the Commission could "settle disputes through conference, conciliation, and persuasion" prior to litigation. Id. The termination of litigation through settlement is, of course, a judicially favored way of disposing of litigation. Petty v. General Accident Fire & Life Assurance Corp., 365 F.2d 419, 421 (3d Cir. 1966). Accord: Stanspec Corporation v. Jelco, Inc., 464 F.2d 1184, 1187 (10th Cir. 1972); State of West Virginia v. Chas. Pfizer & Co., 440 F.2d 1079, 1085 (2d Cir.), cert. denied, 404 U.S. 871, 92 S. Ct. 81, 30 L. Ed. 2d 115 (1971).
The intervenors, however, seek to eviscerate the Consent Decree, and their attack on the decree has arguable legal merit only because the decree was formulated through a process that fully complied with the express intent of the Congress. If this case had gone to trial, and if the Government plaintiffs had proved, as they alleged in their complaint, that AT&T had in fact discriminated against women and minority employees in its promotion and transfer policies, it is clear that this Court would have had the equitable power to fashion an appropriate remedy for that discrimination, i.e., to order affirmative action in promotions and transfers. See Patterson v. Newspaper and Mail Deliverers' Union of New York and Vicinity, 514 F.2d 767, 775 (2d Cir. 1975); Schaefer v. Tannian, 8 EPD para. 9605 (E.D. Mich. 1974); N.A.A.C.P. v. Civil Service Commission, S.F., 6 EPD para. 8956 (N.D. Cal. 1973). It would surely be incongruous if the use of Congressionally preferred means to achieve a Congressionally desired result would leave that result vulnerable to attack on the ground that the Congressional intent had been violated. Yet that is precisely the kind of ruling that the intervenors seek from this Court.
They conveniently overlook both the general judicial preference for settlement of litigation and the specific Congressional preference for settlement of Title VII litigation.
They appear to say that because no evidence of discrimination was produced here, there was no evidence of discrimination to be introduced. This implicit argument suffers from the same historicity that flaws so many of intervenors' arguments. It ignores, for example, the administrative proceedings before the Federal Communications Commission concerning the same charges alleged in the instant complaint. Those proceedings lasted for more than a year, involved approximately 60 days of hearings, at which 150 witnesses testified and over 200 exhibits were introduced into evidence, and produced a record of more than 8,000 pages.
I took specific note of these proceedings in my earlier opinion in this case. 365 F. Supp. at 1109, 1114.
Indeed, the intervenors themselves have introduced evidence that would tend to support a finding of sex discrimination within the Bell System. See Affidavit of Richard W. Hackler, Assistant to the President of CWA, Doc. #88, para. 9 (traditional job classifications according to sex), para. 10 (pay differentials between traditionally male and traditionally female jobs), para. 13 (infrequency of transfer into traditionally male craft jobs or into traditionally female operator and clerical jobs).
Ultimately, however, I do not rest my rejection of intervenors' evidentiary contentions on the presence in the record of some evidence of racial and sexual discrimination by defendants. A federal court, when it reviews the settlement of an employment discrimination action, may not disregard the public policies embodied in Title VII. See Rios v. Enterprise Association Steamfitters, Local 638, 501 F.2d 622, 628 n.4 (2d Cir. 1974). Moreover, as the court of appeals for the Second Circuit has said in a case substantially similar to the instant action:
"the clear policy in favor of encouraging settlements must also be taken into account, see Florida Trailer & Equipment Co. v. Deal, 284 F.2d 567, 571 (5th Cir. 1960), particularly in an area where voluntary compliance by the parties over an extended period will contribute significantly toward ultimate achievement of statutory goals."