California Brewers Assn. v. Bryant – Oral Argument – November 27, 1979

Media for California Brewers Assn. v. Bryant

Audio Transcription for Opinion Announcement – February 20, 1980 in California Brewers Assn. v. Bryant

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Warren E. Burger:

We’ll hear arguments next in California Brewers Association against Bryant.

Mr. Carr, I think you may proceed whenever —

Willard Z. Carr, Jr.:

Mr. Chief Justice

Warren E. Burger:

— you’re ready.

Willard Z. Carr, Jr.:

— may it please the Court.

Question which is before the Court in this case is whether the requirement that there’d be 45 weeks of work within a calendar year in order to achieve the status of a permanent employee, the California brewing industry, whether this is a seniority system or a part of a seniority system.

The Ninth Circuit found that it was an all or nothing proposition and that didn’t — did not meet the fundamental test with seniority system which they said had to be based upon length of service.

It is our position that from an examination of the system itself, it not only looks like a seniority system, it operates as a seniority system, and it is a seniority system.

California brewing industry, at the time this complaint was filed, operated under a multiemployer agreement.

There are a number of unions involved under this agreement too.

Within the particular classification of brewer which is the classification of Mr. Bryant, the plaintiff in this case held, there were three tiers of employees.

There were new employees, there were temporary employees, and there were permanent employees.

A new employee was an employee who work 60 days within a calendar year in order to become a temporary employee.

A temporary employee was an employee who worked within 45 weeks within a calendar year in order to become a permanent employee.

Throughout the time, from the day that the employee first comes to the industry and starts working in the industry, starts acquiring seniority.

He acquires seniority on two different bases.

He acquires seniority on the plant basis and he also inquires seniority on an industry basis.

This seniority has different applications for different purposes.

But for each day that the employee work, he is building up seniority credit towards various purposes under the Agreement.

For example, after the employee has worked 30 days, he is no longer a probationary employee.

After he’s worked 30 days, he cannot be discharged except for just cause.

After he has worked 60 days within a calendar year, then he becomes a temporary employee.

Now, when he’s a new employee as he’s working along this way, he is building up plant seniority as a new employee.

He’s also building up industry seniority as a new employee.

Among other new employees, he has seniority rights within the plant.

He would be laid off after other — after other new employees were laid off who were junior to him.

And within the industry, he would have also rights as a new employee.

When he becomes a temporary employee, he then has further rights as a temporary employee on the basis of his work within the particular plant and also as a temporary employee based upon his work within the industry.

If a temporary employee is going to be laid off, he is going to be laid off based upon his seniority.

The junior temporary employee working in that plant would be the first person laid off.

Willard Z. Carr, Jr.:

The senior temporary employee will be the last laid off.

If an employee is going to be recalled to work within that plant and they have a need for temporary employees, then the temporary employee with the greatest seniority within that plant will be the first to be recalled and the temporary employee with the least seniority within that plant will be the last recalled.

The same situation pertains to permanent employees.

Within the classification of permanent employees, it is the permanent brewers that we’re talking about, Your Honor, within the classification of permanent employees, employees are laid off according to their seniority as permanent employees.

The most senior permanent employee is laid off last, the most junior employee — permanent employee is laid off first.

On a question of recall, and this is again on the basis of plant seniority, the permanent employee with the greatest seniority would be recalled first and the plant employee or the permanent employee with the least seniority would be the — recalled last.

This is the way it works on a plant by plant basis.

In addition to this, our industry applications of the seniority principle — for example, the temporary employee and I might pause here for a second to point out that the term “temporary employee” maybe a misnomer.

It’s a term that is used in the contract.

These are not temporary employees in the sense that they’re casual employees, these and temporary employees maybe employees who have worked for a period of years within the industry and have acquired important and significant rights.

The temporary employee on the basis of this industry service, he may work for one company, for two companies, for three companies, will acquire rights and will work — work towards acquiring the 45 weeks of work within the calendar year which will enable him to become a permanent employee.This is an application of industry seniority.

Also, there’s another application of industry seniority as far as temporary employees are concerned.If a temporary employee is out of work, he’s been laid off by his own employer and all the temporary employees with plant seniority at another plant have been recalled and they still need for additional temporary employees of that plant, the plant employee or the temporary employee with the greatest industry seniority will be the first person recalled to that plant.

So this is another application of the seniority principle working within the system.

And the employees also are acquiring in other rights in addition to the competitive rights of seniority which I mentioned.

They’re also acquiring benefit rights.

They’re acquiring rights as far as health and wealth are concerned.

They’re acquiring rights as far as pensions are concerned.

They’re acquiring rights as far as vacations are concerned.

These rights are building up within this multitiered system as the employees progress through the system.

Now, when the system comes to the point where the employee is working, say less than 45 weeks, the temporary employee is working less than 45 weeks within the calendar year, and so therefore, he does not become a permanent employee.

The Ninth Circuit suggested or claimed that this was an all or nothing proposition, and that he had to start over again on January 1 of the following year and earn the 45 weeks of work within that year.

In our opinion, this was a failure on the part of the Ninth Circuit to examine the system as a whole as this Court has said on numerous occasions, seniority systems are quite varied in their application in the varieties that they have and that there’s no one system is — note 41 in Teamsters says, “No one system is to be preferred.”

Harry A. Blackmun:

Mr. Carr —

Willard Z. Carr, Jr.:

Yes sir.

Harry A. Blackmun:

— you don’t — will you point out where in the Ninth Circuit statement was incorrect.

Willard Z. Carr, Jr.:

Well, in our opinion, Your Honor, they said it was an all or nothing proposition.

In other words, a person had to start over again the following year and then so —

Harry A. Blackmun:

Is — is that incorrect?

Willard Z. Carr, Jr.:

It is incorrect, Your Honor in this respect, in our opinion.

He does not lose his seniority.

Willard Z. Carr, Jr.:

He has a seniority that he’s accumulated as a temporary employee.

If he has worked 40 weeks within 1979 as a temporary employee, he does not lose that seniority on January 1, 1980.

He maintains that seniority and that will give him the first opportunity to be referred out to a — the company that — from which he was laid off assuming it was a light layoff at the time and he will be the last person laid off based upon that seniority, that plant seniority that he has acquired is not lost even though he does not attain permanent status within the year.

Harry A. Blackmun:

Well, I don’t think the Ninth Circuit meant it was lost in that respect.

But to become a permanent employee, he has to start over again, doesn’t he?

Willard Z. Carr, Jr.:

He has to earn 45 weeks within the calendar year but he does not start over again in the sense that his seniority is continuing to push him ahead.

His seniority, his plant seniority, his industry seniority is going to give him the best opportunity to work the 45 weeks of work in 1980 to become a permanent employee.

Harry A. Blackmun:

Well, is it not true that if one man who worked on a year and a half but happened to work 45 weeks in one calendar year, is a permanent employee.

Whereas someone who has worked 35 years, 44 hours a week still was a temporary employee and junior to the other one.

Willard Z. Carr, Jr.:

That’s conceivable, Your Honor.

But that I think it’s very unlikely hypothetical.

This case is before this Court without any evidence as to the operation, the maintenance of the system or how it actually operates, is conceivable under the language of the Agreement that this can work.

However, I think it is highly unlikely that an employee would find himself in that position.

There’s only two reasons that an employee, under the situation that you posit could be a disadvantage to that extent.

And that would be, number one, if he is working for a company which has economic problems, economic downturns, and so therefore they are laying off employees and they’re not the job opportunities at that plant, that’s one fortuity.

The other fortuity would be if the employee himself was not available, if he was on leave of absence, if he was sick, if he was injured.

But each day that an employee works under the system within the industry and within the plant, he is acquiring seniority rights which, with reasonable certainty, will assure him of the best opportunity, the best chance of becoming a permanent employee the following year.

In Northern California, the brewing industry as according —

Harry A. Blackmun:

Does the record show how many get across the line between “temporary” and you admit this is a poor term, into the permanent category?

Willard Z. Carr, Jr.:

No, Your Honor.

There is no record.

However, as we indicated in a footnote in our brief, even there are allegations that no blacks have made permanent employee within the industry during the period of time involved in the complaint.

If this case is remanded by this Court, we are prepared to show that there were some 777 employees who became permanent employees from the temporary ranks and that all that members, some 33% were minorities.

And we are prepared to show that if this case is remanded by this Court.

Most of these employees, all but 28 of these employees became permanent employees in Southern California out of 777, this is in a ten-year period from 1968 to 1978.

And all the 28 of them became permanent employees in Southern California.

This is where the companies were operating and that were the most successful.

This is where Anheuser-Busch, Miller, and Schlitz were operating.

They were the most successful.

They are the only three companies left at the present time.

Willard Z. Carr, Jr.:

Mr. Bryant on the other hand happened to be working in Northern California.

At the present time, all those breweries are gone.

In fact, they were declining at the time that he was working in the industry.

For example, he was working at Falstaff in San Jose.

He then transferred, when Falstaff moved to San Francisco to take over a hams plant which had closed, he transferred up there.

At the present time and this is indicated in a footnote in our opening brief.

There are no Northern California breweries.

One of the things which I should also point out on the seniority principle here is that as Mr. Bryant had chosen to and if he could have seen what was going to happen in Northern California with the various companies closing down and no longer operating because of business adversities, he could have sought transfer to Southern California and registered for work in the Southern California area and then referred out as a temporary employee to one of the Southern California breweries.

And then he might at that point of time because they were in expanding mode and there was a — a number of opportunity — job opportunities, he might have been one of the fortunate ones, presumably, he would have been based upon the seniority principles that I’ve alluded to who would have made permanent, one of the 777 employees who have made permanent within the last 10 years.

(Inaudible)

William H. Rehnquist:

Are there no local Northern California beers anymore?

Willard Z. Carr, Jr.:

There are no Northern California breweries operating at the present time and all the companies that were operating under the California Brewers Association contract have now closed down including Falstaff hams, General Brewing Corporation, and Burger Meister was another one that was operating at one point.

There are only three companies operating in California at the present time which are Schlitz, Millers, and Anheuser-Busch.

Pabst closed down, which was a Southern California company earlier this year, which is also the —

William H. Rehnquist:

But Pabst was originally a Wisconsin Company.

Willard Z. Carr, Jr.:

Pabst was a — yes, and Anheuser-Busch was originally in St. Louis but these are companies that were operating in California.

And Pabst no longer has a plant in California.

(Inaudible)

Harry A. Blackmun:

Did they drink more beer in the Southern California than in Northern.[Laughter]

Willard Z. Carr, Jr.:

That maybe true, Your Honor.

I haven’t seen a statistics on that.

That might be something that would come to the Court’s attention on remand.

I don’t know.

[Laughter]

In any event, where the arguments of the Supreme — of the Ninth Circuit in this particular case was that this system is subject to manipulation.

In our opinion, it is not subject to manipulation because it is a seniority system.

It is the major of time worked.

An employee advances within the system from temporary to permanent status based upon the time that he works.

His layoff and recalls from layoff are based upon the time that he works.

This is an objective standard.

Harry A. Blackmun:

No.

Willard Z. Carr, Jr.:

This is —

Harry A. Blackmun:

Based on the time he worked in one year.

Willard Z. Carr, Jr.:

Not — the time — the — his layoff is not determined on the basis of the time he worked in one year, Your Honor.

Harry A. Blackmun:

No.

But you — you said he advanced from temporary to permanent based on the time he worked.

Willard Z. Carr, Jr.:

That’s right.

Harry A. Blackmun:

And they amended that to say on the time he worked in one year.

Willard Z. Carr, Jr.:

Yes.

But then naturally, the time that he has worked before that particular year will push him up to the front of the ranks of those people who will be — have it — or receive the first opportunities for the allocation of the available work in the year in question.

His seniority is not lost.

His seniority continues and he will be the first recalled and he will be the last laid off based upon his seniority as a temporary employee.

So then, he will then become a permanent employee that much more certainly based upon the service that he’s already accumulated as a temporary employee.

This is —

Warren E. Burger:

Is this a — is this a common pattern in the area?

Willard Z. Carr, Jr.:

Yes, sir.

It’s common.

There’s also some other cases that had been cited in the brief and in the AFL-CIO brief, they included in their appendix a example in the Seafarers Union where this type of a program exist.

One of the cases cited in our brief, the New Jersey Brewing Company involved a situation where employees had to work on a similar basis.

Gerber Foods involved a situation where the War Labor Board directed that the provision be that there’d be 600 hours within a six-month period which is quite similar to what we have here.

So there is a considerable precedent for this type of system in this operation of a system along this line.

As the Chief Justice said in a case decided a few years ago when he was a judge in Outland, that very short term is length of service being considered the dominant factor and that is contrary to experience and also to judicial attitudes to say that it is a dominant factor.

In this case, we do have a major of time work and whether it’d be within a discrete period of time as in 45 weeks within a calendar year, it is still a period of time work.

It is not running to any of devises that might be considered in other types of cases if you’re dealing with the supervisor’s evaluation or an educational test or something like that.

This is an objective seniority standard.

It is a major of time work and it operates just on that basis.

Our position as far as the disposition of this case, the disposition that this Court should make this case is first, that it should be remanded to the District Court for Mr. Bryant to have the opportunity to prove any allegations of intentional or differential treatment that he maybe able to establish.

Secondly, if there’s some question in the Court’s mind or in the party’s mind as to whether this is a bona fide system which was specifically not addressed by the Ninth Circuit, then it should be remanded to have a determination made and evidence taken.

One of the problems with this case is that this case is before you without a record as to the actual operation or without any evidence as to whether there’s any question of the bona fides of this particular case — particular provision.

Finally, we think that this Court can and should decide that this particular provision based upon an examination of the totality of the seniority system within the California brewing system, how it works on a plant basis, how it works on an individual company basis that it must be held to be a seniority system and therefore within exemption, 703 (h) of Title VII of the Civil Rights Act of 1964.

Potter Stewart:

But then the —

Willard Z. Carr, Jr.:

Thank you.

Potter Stewart:

— if the Court accepts your argument, how — what action should we take in this case, to remand it?

Willard Z. Carr, Jr.:

Yes, sir.

Potter Stewart:

To see if a — first of all, it was bona fide?

Willard Z. Carr, Jr.:

If there’s a — if there’s any question raised and it has not been decided, yes, it should be remanded to determine if it’s bona fide.

Potter Stewart:

And then also for a consideration of the plaintiff’s Title VII claims of —

Willard Z. Carr, Jr.:

Intentional discrimination.

Potter Stewart:

— know — know — knowing that this is a seniority system.

Willard Z. Carr, Jr.:

And that can — and that could be —

Potter Stewart:

And the issues would be if it’s bona fide and secondly, even if it is bona fide, it was a discrimination —

Willard Z. Carr, Jr.:

That’s right.

Potter Stewart:

— quite apart from this seniority system.

Willard Z. Carr, Jr.:

And under the principles of Franks v. Bowman —

Potter Stewart:

Yes.

Willard Z. Carr, Jr.:

— the Court can grant relief if they find differential treatment without disturbing the seniority system.

Potter Stewart:

Right.

Harry A. Blackmun:

Mr. Carr, I suppose there isn’t any possibility of the unions and management working out something different.

This is an old type of thing.

Surely as a lawyer, in the face of 703 (h), you wouldn’t be drafting this kind of a system today.

Willard Z. Carr, Jr.:

I might not, Your Honor.

It’s been around for 25 years and it’s worked satisfactory as far as the parties are concerned for over the last 25 years.

In addition, you may also notice that there’s another category of employees within the Agreement.

That’s the permanent bottler and the temporary bottler.

You progress from a temporary bottler to a permanent bottler based upon 1600 hours of work, and that is of course, gives credit for overtime work that you may perform.

And that was a change from an earlier provision where they required 45 weeks of work within the calendar year, they changed it to 1600.

It maybe that through the process of collective bargaining which is where we think it belongs rather than before this Court, through the process of collective bargaining, there may be a change in the way that the contract reads and — and how you move from temporary to permanent but we believe it’s up to the parties rather than to the courts.

Harry A. Blackmun:

Well, I suppose the — the argument is that is a collective bargaining and that’s the barrier.

And it — it’s not too dissimilar from the case we had this morning.

Willard Z. Carr, Jr.:

Yes, Your Honor, but this is — we — in our opinion within a specific exemption granted by Congress in Section 703 (h), and that to give Congress its due that this should be held to be exempt from the reach of Title VII otherwise, Your Honor.

Warren E. Burger:

Mr. Wilder.

Roland P. Wilder, Jr.:

Mr. Chief Justice, may it please the Court.

There are a number of facts in this record, some of which have been touched on by Mr. Carr in behalf of the petitioners.

It cannot be disputed and that are R and R few determinative of this case.

One of these facts is that the 45-week rule is based on time served, it is based on service.In determining whether that rule reflects the seniority principle, therefore, it becomes necessary to determine to find out under the system how in a — a temporary employee’s chances of working 45 weeks in a calendar year are allocated.

As Mr. Carr has indicated, the competition for work opportunities among temporary employees is determined by plant and industry seniority that accrues from year to year.

It is this accrual interaction of seniority that affords the employee the opportunity to work 45 weeks in a calendar year, and therefore, satisfied the requirement.

So viewed against the context of the total seniority system, it seems the time that the 45-week rule in the acquisition of permanent status reflects seniority principles to the fullest possible degree.

One of the functions of the 45-week rule is to regulate competition between so-called permanent employees and temporary employees.

It is the way, in other words, that industry service is given partial seniority credit at the plant.

Whereas the Government says at page 24 of its brief, “It is a measure of time worked.”

And like other measures of seniority, the 45-week rule is to a great extent determinative of where an employee appears on the seniority list.

And Mr. Bryant has always agreed that the brewery system should extend recognition to length of industry service.

That appears at page 306 and 307 of the record.

But neither he nor the Government likes the 45-week rule because it does not give controlling effect to what they describe as cumulative length of service.

We submit that in seeking to restrict Section 703 (h) to cumulative length of service systems, our opponents apparently confuse simple longevity with seniority.

Longevity is only one of the values that are reflected in seniority arrangements.

If it were the only value, if it were the only value, all seniority systems would allocate opportunities across the broadest possible basis.

There would be no collective bargaining agreement establishing separate units of seniority as appeared in the system considered by this Court in Teamsters.

There would be no agreements having rules providing for the breaks in seniority or for loss of accrued seniority altogether as can be found in virtually every collective bargaining agreement.

But the point is —

William H. Rehnquist:

You say in effect this — if that’s all seniority, means all you would need to do is have a (Voice Overlap) one or two sentence definition of it, the number of days you worked for the plant.

Roland P. Wilder, Jr.:

I’m not sure I followed the question.

William H. Rehnquist:

Well, you’re — you’re saying that seniority is as simple as the Ninth Circuit said it was, then all you would need in defining a seniority system is a one or two sentenced paragraph.

Roland P. Wilder, Jr.:

Simply a — a sentence in the collective bargaining agreement saying that plant seniority shall govern for all purposes.

That would be the end of the seniority clause, it would not —

Potter Stewart:

Well, it would still have to be — well, suppose defined in terms of interruptions and so on.

Roland P. Wilder, Jr.:

Well, I think that there is one other factor that would have to be here other than the measure of seniority.

Potter Stewart:

Right.

Roland P. Wilder, Jr.:

There would have to be a definition of the field of eligible participants.

Potter Stewart:

Certainly.

There are — all has to be all sorts of ground rules (Voice Overlap) —

Roland P. Wilder, Jr.:

Otherwise, you (Voice Overlap) wouldn’t also compete using their plant seniority.

Potter Stewart:

Precisely.

Roland P. Wilder, Jr.:

But the — the point that I — that I wish to make and I — I think it is an important one that the qualifications on absolute accumulation of seniority exist today.

They existed in 1964 when Title VII was passed and they existed from the beginning of seniority arrangements in the 1880s in the railroad industry.

Congress in 1964, acted to protect — vested seniority rights.

Those rights that had accrued under seniority systems if whatever form and description, we think it plain that Congress did not seek to restrict Section 703 (h) its protections to so-called accumulative length of service systems if indeed such systems exist.

That’s all.

Thank you.

I would like to reserve the rest of my time for rebuttal.

Warren E. Burger:

Mr. Wolpman.

James Wolpman:

Mr. Chief Justice and may it please the Court.

I must add to the facts shortly anyway.First of all, there is still a brewery in Northern California, Anheuser-Busch operates a very large brewery in Fairfield.

During much of the time that this dispute was going on, there were likewise other breweries in Northern California where Mr. Bryant could have worked.

Mr. Bryant seems to fall into the category of an inconceivable situation as Mr. Carr has phrased it, in view of the fact that he worked for seven years in the Northern California brewery industry and never was able to pass the barrier into permanent employment.

Potter Stewart:

Well, he obviously didn’t work for seven years in the common meaning of that term.He — he worked for the parts of seven years.

It’s a —

James Wolpman:

Right.

A major part — his major source of income during that period was —

Potter Stewart:

Well, we don’t know what his income was, I mean it — it could’ve been — even if he’d worked a week in one year.

James Wolpman:

Right.

That’s — it’s in the — it — there is in the record, there are some interrogatories, indicated the periods of time that he worked during those years and it was his major life endeavor.

Potter Stewart:

He didn’t work for seven years.

He —

James Wolpman:

That’s correct.

Potter Stewart:

Yes.

William H. Rehnquist:

Did this case —

Potter Stewart:

Right.

William H. Rehnquist:

— go off on summary judgment or was it after trials?

James Wolpman:

It was even before summary judgments on motions to dismiss filed by the defendant breweries, Your Honor.

William H. Rehnquist:

And the motions for summary judgment granted by the breweries were granted in that — those judgment or were reversed by the Ninth Circuit?

James Wolpman:

That’s correct, Your Honor.

Warren E. Burger:

And remanded.

James Wolpman:

That’s correct.

The — there are two other important facts.

One is that there is no difference in the actual day to day work carried on by a permanent brewer and by a temporary brewer.

Yet there is a tremendous difference in the pay and benefits which accrued to those two categories.

In our brief, we’ve indicated with citations to appropriate parts of the collective bargaining agreement no less than 16 areas where the permanent brewer is advantaged over the temporary.

William H. Rehnquist:

Well, that’s true of someone who has worked five years on an assembly line and someone who’s worked 25 years on an assembly line too, isn’t it?

James Wolpman:

I doubt that it would be that extreme.

This is certainly an extreme situation.

I want to point that out because the Ninth Circuit took that, I think, into account in sort of a litmus paper test if you want as to whether this was a seniority provision.

William H. Rehnquist:

What do you mean a litmus paper test?

James Wolpman:

Well, any — there’s so many differences.

The — the system operates so harshly on the temporary as compared to other people down the seniority lines and other kinds of operations.

And the cutoff, this all or nothing thing, is so unique that I think that — that that possibility led the Court to go on from that and — and begin to analyze what was behind that possibility as revealing that what was really going on here was something other than seniority considerations, and I’ll try to — I have to — I’ll try to draw that out a little more in my argument, Your Honor, as we proceed.

William H. Rehnquist:

But if this — our case wasn’t on summary judgment or a motion to dismiss, how can the Ninth Circuit have any peculiar knowledge as to what was “behind” the Agreement.

James Wolpman:

The Agreement itself will tell us a lot, Your Honor.

It will tell us that there’s a tremendous financial advantage to the employer if he utilizes temporaries who do the same work as permanents, that that’s the purpose for this provision.It’s not a seniority provision.

William H. Rehnquist:

But it was collectively bargained for by the union, could — presumably has the employee in mind.

James Wolpman:

Right.

And the union did have some employees in mind.

That’s the other part of the purpose.The old time employees, it definitely were taken into account.

In fact, the fine — essential a finite wage and benefit package has been divided up by those few permanents to the disadvantage of the temporaries.

William H. Rehnquist:

Well, isn’t that a complaint that temporaries may have against the union rather than that the possible permanent employee has against the employer?

James Wolpman:

I think it raises really — no, the question that is the — is this really a seniority a provision or is it a thing that allows the employer low-paid labor and the old timers the right to — to divide up a — a package among themselves, a — a smaller number.

Now, that’s — that’s — that may — there’s — I’m not saying those reasons are necessarily illegitimate or illegal.

I’m saying those are not the reasons that lie at the — at the root of the seniority principle to see — the root of the seniority principle is to reward the accumulation of service, to reward the person as he works for years and years.

Not to — on what it does for the employers making — make it cheaper or for the unions allow a few people to share all of the benefits.

William H. Rehnquist:

But to the extent that it makes it more expensive for the employer to keep on employees who worked for a number of years and the employer has a finite amount of money that he can devote to labor cost.

It necessarily makes it cheaper for the employer as with respect to new — new employees.

James Wolpman:

It certainly does, Your Honor but that’s not seniority.

That’s — that’s our point.

That’s something else.

And that’s something that would have to be justified as a business necessity.

Remember, we’re not saying that the 45-week provision is automatically invalid.

We’re saying if we go back to the District Court, we will have to establish that, and indeed does perpetuate the discrimination of the past and the employer will have the opportunity to — to establish that.

Indeed, he has to have it that way because it’s a business necessity.

William H. Rehnquist:

But any bona fide seniority system is necessarily going to be top heavy with labor cost at the — at — at the upper end of the age scale of the workers and if the — if it’s a finite of amount of wages of — of money available to the employer, it’s going to be conversely lower in the lower wage scales.

James Wolpman:

I — I think we have to get — to — to get at the — to the answer to that question, you have to begin to see what kind of industry we’re talking about here, Mr. Justice Rehnquist.

You have to see that we are talking about a seasonal industry.

And a seasonal industry, what is unique about a seasonal industry is that it is tied to the calendar year.

It’s — it’s a calendar year notion.

And the biggest thing about jobs in that senior — in that kind of industry is whether or not you are a year rounder or whether you’re just a seasonal.

That’s — that’s ingrained in the job structure of a seasonal industry.

And what the 45-week provision is about — is about, is about the classification structures that exist in seasonal industries, it’s not about seniority.

Seniority comes into play in the first half of the — there — the sentence, 45 weeks in a calendar year.

45 weeks as the Government indicates, is a seniority measure in a calendar year, is something that comes from somewhere else that comes from the principles that I’ve indicated to you, the advantages that accrued to the employer and to the old time union members that have nothing to do with seniority.

So you put those two together and you get the 45-week rule.

William H. Rehnquist:

Well, you say that a — as a rule where 45 weeks out of 52 does not count as seniority or if it’s a 44, does not advance one toward seniority, is a seasonal industry?

James Wolpman:

That’s right, Your Honor.

That’s the typic — the — the typical way that you’ll find in packing industry, for example, you’ll find this — the same kinds of structure which are being attacked to.

They have to do with the job structuring of the industry, not with seniority.

Warren E. Burger:

What’s the vacation period maximum for a very seniority employee in this industry?

James Wolpman:

I don’t know off the top of my head, Your Honor.

I suspect that it’s —

Warren E. Burger:

Must be at least two to three weeks, isn’t it?

James Wolpman:

That’s right.

Warren E. Burger:

More likely three than two.

James Wolpman:

That’s right.

It —

Warren E. Burger:

Possibly four?

James Wolpman:

Possibly.

It — it can get very difficult —

Warren E. Burger:

Then you don’t have —

James Wolpman:

— to pass —

Warren E. Burger:

— then you don’t have many — you don’t have much range between five weeks and four weeks and seven weeks.

James Wolpman:

It’s a — it’s a very, very difficult hurdle.

And it’s a hurdle that — again, and the Ninth Circuit observed, that’s the hurdle that you have to be very mistrustful of because in any large industry, there is enough free play in the scheduling of the startup of production and in the timing of layoffs to very easily allow an employer the economies that come with maintaining a large low-paid labor pool.

I think that the — the best way I can portray the — the — what — what I’m trying to get at here is to put it in the context of collective bargaining.

In collective bargaining, the — the union comes in with proposals and the management comes in with other — with counterproposal that seek to limit or to alter the proposals.

That’s — that’s exactly the way it is with seniority.

Unions will generally propose seniority provisions.

Management will answer with countervailing limitations on the seniority provision, limitations such as testing, ability, supervisor’s recommendations or whatnot.

Those are non-seniority principles.

And — and what you may come up with is some kind of compromise between those two.

Potter Stewart:

Since this was decided rather summarily as it was, I suppose there is nothing in this case — in the record to show the history of the collective bargaining of this particular provision, is there?

No, Your Honor.

And of course we would —

But one — one can assume that it followed the pattern that you’re describing of give and take.

James Wolpman:

That’s correct, Your Honor.

Now, given that give and take, I think that — and this — and this is the real danger of the position that the employers are taking — taking.

Given that give and take, what they want to say is that any system that combines those two elements, the seniority principle plus the conflicting countervailing considerations which — which have been interjected in the course of bargaining by the employer that that entire system is protected.

In other words, you have not only the seniority principle but you have the concerns that are coming from the opposite direction.

Now, I think that that — and now — and that’s why they say a mixed system is protected so that — such that, well, they’ll — they’re willing to acknowledge that a test for example as a — as a grounds for promotion would be invalid.

They would claim 703 (h) protection for a test combined with a — a seniority provision.

Now, besides these countervailing non-seniority considerations that do come from management, there are again seniority principle and the aspects of it has to be worked out.

There has to be rules for how seniority is obtained in a unit.

There has to be rules for loss of seniority.

James Wolpman:

There has to be rules for breaks in service.

These rules have to do with the elaboration of the seniority principle.

They are a part of seniority.

They do not concern the countervailing considerations that the employers generally have introduced to erode the notion of seniority.

They could be said to compliment or elaborate rather than override, supersede or restrict.

So the real issue here becomes, is the 45-week provision in a calendar year, one of these housekeeping ground rules or is it something that is coming from another direction from the countervailing limitations on seniority.

And that is as I think, requires an analysis of the purpose behind the 45 weeks in a calendar year.

So I think that ultimately, you have to get at the purpose behind this.

And this is nothing new.

The Court has — has done this in the veterans cases, in Accardi and in Alabama Power.

It didn’t take what management and laborer agreed to as seniority or non-seniority, in those cases, it faced value.

It says we have to look at it.

We have to enter the (Voice Overlap) —

William H. Rehnquist:

Did the — did the Ninth Circuit send this back for trial or did it simply say, “This is not a seniority system.”

James Wolpman:

It — well, it — it sent it back for trial but it also said that this is not a seniority system, therefore, we would go to trial on the issue of whether it is perpetu — whether it indeed does perpetuate discrimination and whether it can be justified as a business necessity.

It eliminated 703 (h).

William H. Rehnquist:

Well, if you — if you — if you’re right and you have to kind of look at the purpose of the thing just behind it, I would think that was a factual issue if there ever was one.

James Wolpman:

I — I would say that except that the facts are so completely clear in the collect — from the nature of the collective bargaining agreement.

The obvious — obvious economic advantage which accrues to the employer by maintaining a few permanents and as many temporaries as possible.

The obvious advantage which has been pointed out by — like Professor Slichter in his book which is cited in all the briefs as to the old timers getting what they want.

Now, there’s nothing wrong with the old timers getting what they want.

There’s nothing wrong with the employer trying to save money, but that’s not seniority.

That’s not what Section 703 (h) was about.

William H. Rehnquist:

It certainly was collective bargaining in this.

James Wolpman:

It certainly was collective bargaining but not everything as we well know from the history of Title VII litigation is in collective bargaining is to be protected.

Well, I think there’s a real danger that if we took this mixed notion of seniority, that is the rules for working out seniority and the seniority principle and this countervailing considerations that the — that the expansion in that would occur in 703 (h) would — would wind its way into just about every part of the collective bargaining agreement.

We’ve pointed out 16 areas in this collective bargaining agreement where the seniority principle plays some role.

Now, if every area that is touched by that principle is automatically protected by 703 (h), I question whether we — Congress did not enact the Seniority Protection Act of 1964 rather than the Civil Rights Act of 1964.

Byron R. White:

Well, on the other hand, if this is not a seniority system, it’s going to be quite a swath cut through collective bargaining agreements, isn’t there?

James Wolpman:

No greater a swath, Your Honor.

Byron R. White:

Well, how do you — how do you phrase the position of the AFL-CIO in term —

James Wolpman:

Well —

Byron R. White:

They’d — they’d say this is a seniority system.

James Wolpman:

They say that it is a senior — and they actually adopt our reasoning.

They say that anything that overrides seniority is not a seniority system.

But then they adopt a definition of the people who can compete in a system that — that sort of brings in the back there all of my words.

Byron R. White:

Well, in any event, this is — in any event, this is a seniority system in their — in their view.

James Wolpman:

In their view, yes, Your Honor.

Byron R. White:

And I suppose I wouldn’t be so interested if this was on the effect, maybe one or two strays — stray collective bargaining agreements, wouldn’t it?

James Wolpman:

It certainly affects any collective bargaining agreement or many collective bargaining agreements in seasonal industry, and I think that in — in analyzing this problem, the Court is going to have to inevitably meet the question of — of just how broad 703 (h) could be.

That it shouldn’t include these countervailing considerations and that’s important.

Byron R. White:

I suppose somebody besides permanent employees belong to these unions.

James Wolpman:

I — I’m sorry Your Honor, I didn’t hear you.

Byron R. White:

I suppose someone besides permanent employees belong to these unions.

James Wolpman:

Yes, Your Honor.

The difficulties however of the temporary employee in asserting his powers within the union is — is something that I can only point to, there’s certainly nothing in the record.

I can only say that this Court in — in the veterans cases has not turned its back on — on what is and what is not a seniority and left it entirely to the — to whatever the union and the manage — management happen to say.

I think it maybe — you know, it’s an old and very sad story.

When people can’t clean their own houses, the Government sometimes has to clean it for them.

And the history of the intrusion of the Government in the area of discrimination into employment relationships is one that has showed a great deal of patience and reluctance on the part of the Government up until 1944 when the Steele case was — Steele versus Louisville and — and Nashville Railway case was decided, the Government has stayed out of this area.

Then in 1944, it entered the fray because of what — what was — I can only characterize it as abysmal discrimination.

But then —

Byron R. White:

Well, your — your argument about whether this is a seniority system or not would be the same whether there was any racial — racial aspects of this case at all.

James Wolpman:

Yes, Your Honor.

I think we have to — we have to decide what is a seniority system.

It only becomes critical not in the — in the racial case, in a racial situation because of the way the legislation is drawn of course, but I think we do have to work toward a — an analysis as to —

Byron R. White:

And it’s not just to — it won’t be disgrace or be any kind of what could be called invidious discrimination.

That would be — that could be gotten at —

James Wolpman:

Well, that would have to be gotten not only for the duty of fair representation, Your Honor.

And as I pointed out, probably under the duty of fair representation, which we had for 20 years and did not accomplish the purpose, what it — that it was supposes to.

James Wolpman:

It made it impossible to get at this kind of situation.

Under Title — under Title VII which again after 20 years, Congress decided that it could not countenance what was going on in the workplace and it came in with another stronger test.

It wasn’t the duty of fair representation test, it was the business necessity test.

And so I think that the — the Court sees a tremendous amount of patience and it’s time.s

William H. Rehnquist:

Well, certainly, of a good deal of that patience ended with the Landrum-Griffin Act of 1959 where the Congress finally got into the internal affairs of unions to a certain extent.

James Wolpman:

Right, Your Honor.

I can only come into — we certainly don’t — I do not know the internal affairs of these unions, I can only point to my years of experience in the difficulties that younger people have in — in asserting power in — in some sorts of unions.

I — I — that’s all I could say about that, I mean we could develop that as we develop the record.

William H. Rehnquist:

But how do you develop a record except by trial?

James Wolpman:

I think with — well, we have to decide first of all, is this a seniority system?

And I think there is a record to do that, to whether this is — whether this is —

William H. Rehnquist:

A record of — of witnesses?

James Wolpman:

No.

I don’t think that’s necessary.

The seniority system is a creature of contract.

Is there — we can look at the contract which is before this Court, and say, “Is there a mechanism in there which protects the accumulation of services — of service as a way of advancing?”

And I think we can see from the 45-week provision that it does not.

Thank you.

Warren E. Burger:

Mr. Wallace.

Lawrence G. Wallace:

Mr. Chief Justice and may it please the Court.

As the United States views the governing legal principles in this case, the broader propositions urged by the employers and the unions here proved too much.

Seniority in the sense of length of service is ordinarily a substantial ingredient in transfers, promotions, layoffs, rehirings and in measuring compensation and fringe benefits.

This cannot mean, we submit, that all additional criteria considered along with seniority for such purposes thereby become part of the seniority system within the meaning of Section 703 (h) and thereby become immunized from examination under the ordinary standards of Title VII.

Otherwise, the limited purpose exception of 703 (h) would largely swallow up Title VII’s guarantee of non-discrimination in transfers, promotions, layoffs, rehiring, and in compensation and fringed benefits.

So our major premise in this case is that a rule such as the 45-week rule that at issue here, must be separately scrutinized for purposes of Section 703 (h) to determine whether it embodies the seniority principle.

Another way of stating the same proposition is that we don’t believe the use of the word system in Section 703 (h) is meant to be a grab bag for non-seniority considerations that can be tied in with seniority considerations and thereby immunized from the basic non-discrimination principle of Title VII.

If anything, we would submit that it would be more plausible to read the word system in 703 (h) as indicating the way in which seniority can be used to override the non-discrimination principle.

It’s only systematic use rather than ad hoc use of seniority which is being authorized to override the basic purpose of the statute, the non-discrimination principle so that there will be a guarantee that to the extent seniority will override the basic principle of the statute, it will be systematic seniority available to all classes of persons rather than ad hoc use of seniority that might prejudice the protected classes.

Now, our minor premise in this case, it seems that that’s fundamentally important question before the Court.

Our minor premise is that the 45-week rule at issue here does not embody the seniority principle as we understand it because it does not provide reasonable certainty of progression based principally on cumulative length of satisfactory and reasonably continuous service.

Lawrence G. Wallace:

This does not mean that the rule is invalid but only in our submission that it is not immunized by Section 703 (h) from a challenge under Title VII.

And the legal standard I have stated is a rather complex one involving cumulative length of satisfactory and reasonably continuous service and reasonable certainty of progression.

It — and I —

Byron R. White:

Is this the —

Lawrence G. Wallace:

our —

Byron R. White:

— is this the Ninth Circuit standard?

Lawrence G. Wallace:

Well, I don’t think they were that specific, Mr. Justice.

Although they said nothing inconsistent with this as I read their opinion.

It seems to me the complexities of seniority rules largely go to determining these various elements that I’m stating rather than to incorporating in other considerations and other values that don’t go to effectuating the basic principle of seniority which is what Congress meant to protect.

And their discussion was largely in terms of last hired, first fired kind of relatively simple considerations.

It seems to us that this is the approach to 703 (h) that is faithful to the basic purpose of Title VII which was to assure that there would be a non-discrimination principle applicable to work rules affecting all these valuable rights in the employment relationship.

And our view of what constitutes seniority for these purposes is supported as well by this Court’s decisions by analogy, considering what constitutes seniority for purposes of veterans’ reemployment rights under the Military Selective Service Act.[Laughs]

As we explain in some detail in our brief on pages 8 and 9 and in footnote 7, one of the reasons we think this 45-week rule does not meet the legal standard for purposes of 703 (h) is because of the fortuities that it permits to displace cumulative length of service as determinative of achieving the permanent status that’s involved here.

But even if, in our view, even if it produce results that more closely approximated cumulative length of service, it still seems to us would not be a rule that’s part of a seniority system because of the lack of reasonable certainty of progression which was the basic reason why in the McCarthy case, cited and discussing our brief, this Court held that a veteran was not entitled to a promotion that he could not be reasonably certain of having received during the period of his military service.

That after all is an act in which seniority of being an emulative principle should be broadly interpreted where here, it’s an exception that should be narrowly interpreted.

Instead, what we have is a classification system which — as Mr. Wolpman has explained, has something about us and them syndrome in which there is no reasonably certain progression from the class of them to the class of us that can be earned through stages of seniority, through which there is some kind of systematic progression.

Now, it maybe that in this industry, these classifications are justified by the business needs of the particular industry.

And we don’t say that in determining whether the business justification has been met under Title VII, there is no room for flexibility in the collective bargaining process.

William H. Rehnquist:

But if the business justification is meant, wouldn’t it be also a business justification for that kind of a seniority system?

Lawrence G. Wallace:

Well, there are — the — the seniority aspects of this contract don’t need a justification in our view, Mr. Justice, but because they’re protected by 703 (h) and some of those were recited by Mr. Carr.

But the 45-week rule for the reasons I have just stated is not part of this seniority provisions.

William H. Rehnquist:

Well, you say —

Lawrence G. Wallace:

It’s —

William H. Rehnquist:

— then that you — the plaintiff can pick and choose as among the seniority provisions and say some are protected by 703 (h) and some aren’t.

Lawrence G. Wallace:

Well, that the question presupposes that the 45-week rule is a seniority provision but I have devoted my entire argument to the reasons why we think it is not a seniority provision.

So I — I can only say that it’s not a matter of picking and choosing the seniority provisions, are protected by 703 (h) but this is not a seniority system both because it’s not based principally on cumulative length of service and — and because there’s no reasonable certainty of progression from one class to another here.

But we do believe that there is a needing of the business necessity test considerable room for flexibility in the bargaining process for reasonable accommodations to meet the substantial needs of the industry.

But the inquiry still must be as a justification of these classifications whether this does meet a substantial need of the industry.

There — there is room for flexibility in determining how to meet the substantial needs.

But the question, if a prima facie showing of discriminatory impact is made, would be whether a classification system of this type is necessary to meet substantial needs in this industry.

Lawrence G. Wallace:

All of this has not been explored although some justifications have been recited in the briefs but it since it’s not —

Byron R. White:

Well, Mr. Wallace, I think that if — if the employer and the union had a contract and — and they agreed that one classification of employees was permanent employees, then at — in this company, we — they had agreed there would be a hundred employees of permanent employees.

And that as — as — and a permanent employee retired, he’d be replaced and he’d be replaced by the fellow who had worked the longest time in the last two years.

Now, I take it that you’d have the same problem with that.

Lawrence G. Wallace:

Well, there might — there might be —

Byron R. White:

Well, that should be the same thing.

Lawrence G. Wallace:

It — it’s very similar although there would be some additional certainty of progression in your —

Byron R. White:

Why, what for example?

Lawrence G. Wallace:

— hypothetical Mr. Justice, because here —

Byron R. White:

Except that it’s just between two years and one —

Lawrence G. Wallace:

Here, the indications are that automation is reducing the number of permanent employees and that people are not progressing into that rank but this is something that has not been explored in detail.

It is an allegation.

And the — the Court of Appeals, although I — I can’t say what it has based on, stated that no one in Northern California is advancing from one class to the other.

Byron R. White:

But the — but in this case, the question of seniority has been finally disposed off by the Ninth Circuit.

It is no longer an issue in the case.

Lawrence G. Wallace:

That is correct —

Byron R. White:

Yes.

Lawrence G. Wallace:

— Mr. Justice.

That based on their interpretation of the terms of the Agreement.

Byron R. White:

And you agree with that.

Lawrence G. Wallace:

We agree with that.

Byron R. White:

Yes.

Lawrence G. Wallace:

But what is of principle concern to us are the governing legal principles which I have come to — to state.

Warren E. Burger:

Mr. Wilder, you have about six minutes left.

Roland P. Wilder, Jr.:

Thank you, Mr. Chief Justice.

Let — let me start first by reviewing — referring to one or two factual matters.

I am advised that AFL plant never had been covered by the Agreement in issue that the industry seniority provisions would not be applicable to that agreement.

Also, Mr. Chief Justice, the maximum amount of vacation a senior employee in the industry can obtain is six weeks per year.

Warren E. Burger:

Please.

Roland P. Wilder, Jr.:

Six weeks per year.

Potter Stewart:

And that would be a permanent employee, isn’t it?

Roland P. Wilder, Jr.:

Yes.

Yes, it would be.

It would be normally through the accrual of an industry vacation by cumulating time worked at different plants.

Warren E. Burger:

So that, even if this fellow would work only 46 weeks in the year then if he — if he qualified —

Roland P. Wilder, Jr.:

If he — if he took the vacation or if he qualified for it, you don’t — you earn your vacation on the basis of time worked according to a particular formula.

You — you don’t get six weeks automatically.

Warren E. Burger:

I suspect there aren’t all that many six weeks people, are there?

Roland P. Wilder, Jr.:

I —

Warren E. Burger:

(Voice Overlap) —

Roland P. Wilder, Jr.:

— do not know Your Honor.

I would suspect not.

However, I should point out that with respect to the allegation that the purpose of the Agreement is to create a — a pool of cheap labor, the temporary employees earn vacations too.

In fact, Mr. Bryant earned a vacation by working 45 weeks in two calendar years at Falstaff.

The point is that the benefits under the Agreement, very expensive benefits, pension, health and welfare are held by temporary employees.

This is not a depressed pool of labor.

Now, building on that theme, I should like to suggest that the analysis suggested by the Ninth Circuit and urged by the Government and the respondent here will affect every collective bargaining agreement because their arguments go not so much to the classifications but they go to the appropriateness of this seniority system.

Under the guise of determining whether or not it is a seniority system, they are questioning the appropriateness.

Let me refer to at least some of the adjectives that I heard them use just before this Court.

It is harsh, it is unfair, it’s unjustified, we can’t see the business necessity, it’s unnecessary.

People don’t like it.

It sets up divisiveness between permanent and temporary employees in the union.

These are questions that go to the appropriateness of the choice that was made by management and labor.

Byron R. White:

Well, but the Government who says more than that.

The Government says — proposes two criteria to — by which to judge whether something is seniority system or not.

Roland P. Wilder, Jr.:

The Government proposes a cumulative length of service criterion which is a criterion that henceforth, it’s been unknown in the real world of collective bargaining.

They proposed absolute cumulative length of service.

Any provision, that does not measure up but of course —

Byron R. White:

It doesn’t — it doesn’t — isn’t triggered by that.

Any advantage that isn’t triggered by cumulative in the services, not part of a seniority system.

Roland P. Wilder, Jr.:

That’s correct.

Now, there has been a suggestion that if this Court holds that this particular provision is a seniority system within the meaning of Section 703 (h).

There will be opened, Your Honor, in gap.

This Title VII protection will be inevitably wounded.

I can’t see how this will happen, but the Ninth Circuit and what the Government are concerned about is privileging classification devices, privileging test, education requirements and other obvious non-seniority criteria.

These are the — these are the override factors that all parties, the employers, the unions, and the AF of L have indicated, would not be covered by Section 703 (h) its protection.

The 45-week rule is a measure of time worked.

It deals with service and because it is itself based on service, there is no possibility whatever that there could be any confusion between an obvious seniority provision like this rule and the classification devices that the — our opponents has so artfully enmeshed in this case.

One quick word if I might on the need to construe 703 (h) narrowly.

This is a theme that’s runs through all the briefs.

We suggest that analytically, it is ill-funded.

Section 703 (h) with a definitional provision caught in the act by Congress to determine what actions were discriminatory and unlawful and what were not.

It was designed to confirm Congress’ understanding stated many times in the legislative history that bona fide seniority systems were not intended to be condemned by the general prohibition of Title VII.

It is not an exemption to Title VII’s remedial purpose.

Indeed —

Byron R. White:

Could I ask you — could I ask you if there was — what if — what if the only semblance of a seniority system in this case was a collective bargaining provision providing for how people enter the permanent employee class?

That’s all, that’s the — and there’s nothing.

You don’t accumulate any other kind of time by being a temporary employee.

There are no advantages whatsoever from — from length of service except if you work 45 weeks in any year or whatever the week is —

Roland P. Wilder, Jr.:

It — it —

Byron R. White:

— you’re a permanent employee.

That’s the only provision.

Roland P. Wilder, Jr.:

I — I will answer the question.

I do suggest, Mr. Justice White, that that was how the Ninth Circuit got in trouble below.

Byron R. White:

Well, I know —

Roland P. Wilder, Jr.:

But with that — but with that —

Byron R. White:

Would that be a seniority system or not?

Roland P. Wilder, Jr.:

I think it would be because it is based on time worked.

It is a criterion of advancement based on actual service as opposed to some other —

Potter Stewart:

But you think (Voice Overlap) —

Roland P. Wilder, Jr.:

Let’s call it a non-seniority criterion.

Potter Stewart:

You’re glad you don’t have that case.

Roland P. Wilder, Jr.:

Yes, I am glad I don’t have that case.

I have a case in which that it once (Voice Overlap) —

Potter Stewart:

Do you say that the Ninth Circuit —

Roland P. Wilder, Jr.:

— in a —

Potter Stewart:

— only simplified the case to be just that.

Roland P. Wilder, Jr.:

That’s correct.

That — as Professor Slichter said, there is a positive danger in —

Byron R. White:

Do you say it was wrong even on its — even on its simplistic assumptions, it was wrong?

Roland P. Wilder, Jr.:

I think that that would make it a — an easier case analytically.

And that is all the Court has to decide in this case.

Thank you.

Warren E. Burger:

Thank you, gentlemen.

The case is submitted.

We’ll hear arguments next in Freeland against the United States.