Opinion ID: 339209
Heading Depth: 3
Heading Rank: 2

Heading: The Mechanics of the Award

Text: 23 The major difficulty in attempting to compute a backpay award in a case such as this one is that the subjectivity of defendant's method of filling job vacancies renders impossible anything like a precise calculation of the pecuniary effects of discrimination. In light of the uncertainty which clouds the task before us, we must set down three general rules: (1) unrealistic exactitude is not required; (2) ambiguities in what an employee or group of employees would have earned but for discrimination should be resolved against the discriminating employer; (3) the district court, far closer to the facts of the case than we can ever be, must be granted wide discretion in resolving ambiguities. See Pettway, 494 F.2d at 260-61; United States v. United States Steel Corp., 520 F.2d 1043, 1050-55 (5th Cir. 1975). 24 It is with these rules in mind that he will discuss some of the problems that will face the district court on remand. The first issue which must be clarified is whether backpay should be awarded on an individualized basis to particular employees or on a classwide basis to be divided among the entire group which plaintiffs represent. Where possible, an individualized remedy should be utilized because it will best compensate the victims of discrimination without unfairly penalizing the employer. See United States Steel, 520 F.2d at 1055. In the case of the discrimination in regard to promotions to the position of hourly clerk, it should be possible to make individualized awards based on the seniority of black employees. A black employee denied promotion who can show that he had more plant seniority 3 than a white employee given an hourly clerk's job should receive the difference in pay between what he did receive and what he would have received as an hourly clerk. While this method will not reconstruct what would have happened in the absence of discrimination, since seniority played only an ancillary role in determining who would fill hourly clerk vacancies, it will do as fair a job as any in compensating the victims of discrimination without granting them a windfall. Moreover, defendant should be estopped from objecting to such a remedy since it claims that promotions to these positions were in fact handled on the basis of seniority. 25 In determining the appropriate award to be made to black employees who were unfairly denied promotions to salaried positions, however, the utilization of an individualized method of calculation is impossible. Because General Motors had no objective standards by which to measure whether a given employee deserved a promotion, deciding in individual cases whether a particular person would have been promoted but for racial discrimination would lead the district court into a quagmire of hypothetical judgments, see Pettway, 494 F.2d at 260, in which any supposed accuracy in result would be purely imaginary. 26 Therefore, it is necessary to use a classwide procedure in awarding backpay as compensation for defendant's failure to promote black employees to salaried positions because of their race. While such a method may generate a windfall for some employees who would have never been promoted had vacancies been filled on a nonracial basis and undercompensate the genuine victims of discrimination by forcing them to share the award with their undeserving brethren, it is the best that can be done under the circumstances. In any event, as Judge Tuttle has noted, (a)ny method is simply a process of conjectures. Pettway, 494 F.2d at 261. Given a choice between no compensation for black employees who have been illegally denied promotions and an approximate measure of damages, we choose the latter. Moreover, there is precedent for such a choice both in this circuit and in others. See Bowe v. Colgate-Palmolive Co., 416 F.2d 711, 721 (7th Cir. 1969); Pettway, 494 F.2d at 259-61; Johnson v. Goodyear Tire & Rubber Co., 491 F.2d 1364, 1375 (5th Cir. 1974); Robinson v. Lorillard Corp., 444 F.2d 791, 801-02 (4th Cir.), cert. dismissed, 404 U.S. 1006, 92 S.Ct. 573, 30 L.Ed.2d 655 (1971). 27 Once a decision is made to use a classwide rather than an individualized remedy, the determination of which employees are entitled to be included in the class receiving backpay becomes crucial. The district court should place an initial burden on an individual employee to give a history of his employment at Broadview, to list the jobs he was denied because of discrimination and their pay rates, and to produce any evidence showing that he was qualified for those jobs. An employee attempting to make this showing should have access to any of defendant's records concerning the Broadview plant which he requires. Once this showing has been made, the burden shifts to General Motors to demonstrate by clear and convincing evidence that the employee would not have received those promotions because of factors unrelated to discrimination. See Pettway, 494 F.2d at 259; Johnson v. Goodyear Tire & Rubber Co., 491 F.2d at 1379-80. 28 The district court must then arrive at a method for calculating the amount which the class, now defined, is to receive. Courts confronting this issue have developed a number of techniques to approximate the monetary effects of discrimination. See Bowe v. Colgate-Palmolive Co., 489 F.2d 896, 902 (7th Cir. 1973); United States Steel Corp., 520 F.2d at 1055-56; United States v. Local 416, Wire & Metal Lathers, 328 F.Supp. 429, 443-45 (S.D.N.Y. 1971); Stamps v. Detroit Edison Co., 365 F.Supp. 87, 121-22 (E.D.Mich.1973), rev'd on other grounds sub nom., Equal Employment Opportunity Commission v. Detroit Edison Co., 515 F.2d 301 (6th Cir. 1975). We approve of the use of some variation of the test period approach utilized by this court in Bowe. The district court should trace over a period of time the history of a group of white hourly employees which is comparable to the group of black employees constituting the class receiving the backpay award. By determining which members of the control group achieved salaried status, how high within the salaried ranks they rose, and what their increases in salary were, it will be possible on remand to estimate for that period the increment in salary which the black hourly employees as a group would have earned had they been permitted to advance to salaried positions. This figure will serve as a benchmark for computation of the actual award. 4 29 The final step which must be taken in calculating both the individualized awards on the basis of seniority and the classwide award is to determine the appropriate period of time for which backpay is to be granted. Title VII contains an explicit statute of limitations for backpay liability, see 42 U.S.C. § 2000e-5(g), providing that backpay shall only accrue for a period beginning two years prior to the filing of a complaint before the EEOC. 5 Since plaintiffs demonstrated an ongoing course of discriminatory conduct by defendant prior to any action before the EEOC, the initial date of the period for which backpay is to be awarded should be set by the statute of limitations at exactly two years prior to the filing of the complaint before the EEOC in June 1972. 6 The termination date of this period will be different for each type of backpay. Since the district judge refused to stay pending this appeal the pertinent parts of the decree dealing with promotions to the position of hourly clerk, the termination date for the individualized awards should be December 15, 1975, the date the decree was entered. He did stay those parts of the decree providing injunctive relief with respect to promotions to salaried positions, however, and the termination date for the classwide award should therefore be the date on which he vacates the stay after acknowledgment of the disposition of this appeal. 30 These dates will have different significance for the calculation of the final awards, depending on whether an individualized or a classwide procedure is being utilized. In computing backpay for employees who were unfairly denied promotion to the position of hourly clerk, the district court should compare the employment record of each hourly employee with company records to determine whether that employee was entitled to promotion on the basis of seniority during the period between June 1970 and December 15, 1975. If so, that employee should receive the difference between what he was paid and an hourly clerk's salary for the period between the time he should have been promoted and December 15, 1975. 31 In the computation of the classwide award, the specific beginning and ending dates of the appropriate period will be unimportant. Rather, the significant fact is that the period will be approximately six and one-half years long. The district court should reach a final figure by multiplying the increment in salary which the white control group earned during the test period by the ratio of six and one-half years and the length of the test period. 7 32 The district court may employ the services of a special master in performing the calculations which we have outlined. See Pettway, 494 F.2d at 258. We would urge the parties to avoid the need for appointment of a special master, however, by negotiating an agreement pursuant to the principles we have outlined. See Pettway, 494 F.2d at 258; Johnson v. Goodyear Tire & Rubber Co., 349 F.Supp. 3, 18 (S.D.Tex.1972), aff'd in part on other grounds, 491 F.2d 1364 (5th Cir. 1974). 33 The judgment of the district court is affirmed except as noted in part III(A) of this opinion and the cause is remanded for further proceedings consistent with part III(B) of this opinion.