Opinion ID: 325324
Heading Depth: 1
Heading Rank: 4

Heading: production jobs.

Text: 44 From the commencement of operations at the Pine Bluff Mill until 1962, employees were assigned to production jobs on the basis of race. However, pursuant to Executive Order 10,925, 27 I.P. announced a policy of racial desegregation for both the physical facilities at the mill and admission into lines of progression. Initial company focus was directed towards desegregation of the physical facilities and only one black was permanently assigned to a white job prior to 1967. 28 45 In 1968, the Office of Federal Contract Compliance, in the execution of the Executive Order program, advised I.P. that they had failed to comply with the non-discrimination requirements of the Executive Order and that, in order to retain government contract privileges, they would have to change employment practices. A conference with representatives of the Southern Kraft Division of I.P. was thereupon called by OFCC in Jackson, Mississippi, to discuss necessary modifications for Executive Order compliance. A Memorandum of Understanding, negotiated at that meeting and endorsed by the affected unions and representative mills, was approved by the OFCC as sufficient for compliance with the Executive Order. That memorandum, dealing only with production jobs, created remedial transfer, promotion and recall opportunities for members of an 'affected class,' defined as all black incumbent employees hired before September 1, 1962, and those additional blacks hired into black jobs after 1962. 29 The memorandum provided that members of the affected class could compete against other applicants 30 for entry level positions in any other line of progression on the basis of mill seniority, so long as an affected class member's qualifications were as high as the minimally qualified employee currently working in the line. 31 Affected class members who transferred under these provisions were offered wage maintenance protection so as not to deter the exercise of the transfer rights to lower paying entry level jobs in other lines of progression. 32 The memorandum also established that promotion, demotion, layoff, and recall rights of affected class members would be governed by mill seniority whenever a class member was in competition with a nonclass member. Finally the memorandum provided that negotiations were to take place at the mill level, between local management and local unions regarding possible merger or shortening of lines of progression, job skipping, and advanced level entry. 33 46 In May, 1969, upon I.P.'s request, OFCC issued a clarification of the Jackson Memorandum's provisions relating to promotion and recall. As I.P. had been administering the Memorandum, affected class employees either permanently or temporarily 34 classified on the job immediately preceding the vacancy, could be considered to fill the permanent vacancy and could compete with nonaffected class members on the basis of mill seniority. The Union had opposed this practice, since under the collective bargaining agreement only those permanently assigned to immediately preceding jobs were eligible for permanent promotions, and also had contended that affected class members could not compete on the basis of mill seniority against those eligible for recall to an entry level position in a line of progression. The OFCC response, called the McCreedy Letter, authorized the company to either establish residency requirements for each job representing minimal time periods essential to qualification for advancement, or to limit competition for permanent vacancies to those permanently assigned to the immediately preceding job classifications. I.P. chose the latter course. The McCreedy Letter also eliminated affected class mill seniority competition against incumbent employees with recall rights for entry into a line of progression. 47 After the trial of this matter below, a revision of the Jackson Memorandum was tentatively adopted. The 1972 Jackson Memorandum expanded the parameters of the affected class; advanced the maximum red circle wage maintenance rates from $3.00 to $3,86 per hour; permitted permanent promotion eligibility to rest upon fulfillment of residency requirements in prerequisite jobs without regard to the permanent or temporary nature of assignment thereto; and permitted affected class competition on the basis of mill seniority against incumbents with recall rights for entry level positions in lines of progression. The memorandum again called for local negotiations on advanced level entry and job skipping. 35 48 The district court found that, with respect to production jobs, since much discrimination had been eliminated, further injunctive relief from the allegedly discriminatory seniority, promotion, and transfer policies governing those jobs was inappropriate. The legal issue on appeal, then, is whether I.P.'s allegedly neutral policies, as modified by the Jackson Memoranda, effectively dispel the present effects of admitted past discrimination or, if not, whether they are necessary to a compelling business necessity. 36 See pp. 1346--1347, ante. 49 Under Title VII, seniority and promotion policies have been frequently scrutinized by courts, despite an exemption for 'bona fide seniority or merit system(s),' 42 U.S.C. § 2000e--2(h), for they can be subtle forms of discrimination which perpetuate discriminatory patterns of the past. See, e.g., Pettway v. American Cast Iron Pipe Co., supra, 494 F.2d at 224; Johnson v. Goodyear Tire & Rubber Co., supra, 491 F.2d at 1373 n. 27 (and cases therein cited); United States v. St. Louis-San Francisco Ry., supra, 464 F.2d at 307. The approach most often followed in ameliorating the built-in discrimination peculiar to dual seniority plans, the most common form of seniority discrimination, is the 'rightful place' doctrine. 37 Bing v. Roadway Express, Inc., 485 F.2d 441, 451 (5th Cir. 1973); United States v. St. Louis-San Francisco Ry., supra, 464 F.2d at 309; United States v. Bethlehem Steel Corp., 446 F.2d 652, 661 (2nd Cir. 1971). Various remedies in effectuating the rightful place doctrine have been adopted. Among them are mergers of segregated unions, 38 advanced level transfers, 39 job skipping, 40 and wage maintenance. 41 To some degree these policies are reflected in the Jackson Memoranda. However, those compliance pronouncements are deficient in several respects. 50 The $3.00 per hr. ceiling on wage rate protection under the 1968 Jackson Memorandum discouraged several affected class members who already had permanent wage rates in excess of that figure. The increased red circle ceiling in the 1972 memorandum, it has been represented, reflects merely overall increases in wage rates since 1968 but does not bring within its protections those previously excluded. Additionally, temporary assignments to jobs higher up a line of progression with comparably higher rates of pay are a frequent fact of employment at Pine Bluff. Thus an employee's permanent wage rate does not necessarily represent his average hourly net rate of pay over a period of time Finally, the red circle computation does not permit cost-of-living and contract renegotiation wage increase adjustments. See generally n. 41, ante. 51 The necessity to serve in every job in a line of progression is still an announced policy of I.P. As proffered at oral argument, an employee must still meet a residency requirement on the job for which he is bidding as well as that of the job immediately below. The cumulative effect of this policy is to nearly eliminate the possibility of job skipping or advanced level entry transfer opportunities. These seemingly neutral requirements that an employee serve in every job in a line of progression have impeded, in the past, affected class members' progress toward their rightful place. They may be retained, therefore, only upon a showing of business necessity. United States v. N.L. Industries, supra, 479 F.2d at 364--366; United States v. St. Louis-San Francisco Ry., supra, 464 F.2d at 308--309. I.P., however, did not present evidence that each job was an essential prerequisite to the next higher job in every line of progression. Some general evidence only was presented about general structures of lines of progression and their business convenience. But that evidence was not specific enough to meet the test of business necessity. Additionally, neither is there any assessment of the legitimacy of the length of each individual residency period 42 or consideration of whether functionally equivalent experience in another line of progression may be substituted for the residency period. See United States v. Jacksonville Terminal Co., supra, 451 F.2d at 453--454. Absent a showing of business necessity for, and justification of, the residency requirements and their respective lengths, advanced level entry and job skipping may be appropriate remedies. See n. 39 and n. 40, ante. 52 Finally, even assuming the trial court should determine that each job is essential to progression, I.P. has in the past, though in part in reliance on OFCC, retarded affected class promotion by its administration of the announced policies. After the McCreedy Letter, competition for permanent vacancies was limited to only those permanently assigned to the position immediately subordinate to the vacancy. This policy effectively eliminated competition for permanent vacancies, and was totally ineffectual in rendering whole the former discriminatees. The 1972 memorandum permits promotion eligibility to rest upon fulfillment of residency requirements without regard to permanent assignments to jobs. However, to bid on a vacancy, an employee must have fulfilled both the residency period for the job immediately subordinate to the vacancy, as well as the period for the vacancy itself. The latter requirement, while properly left to the district court for determination, should be very closely scrutinized. Another factor that will retard affected class movement and is a result of I.P.'s administration of the 1972 Jackson Memorandum is its present practice of further restricting competition for those vacancies to those either permanently assigned, or then temporarily assigned, to an immediately subordinate job. Employees may have satisfied a legitimate residency period in the recent past and thus be qualified for promotion though not be temporarily assigned to the preceding job when the permanent vacancy occurs in the line. 53 For these reasons we conclude that the present transfer, promotion, and seniority practices in the production department at Pine Bluff continue to perpetuate the effects of past discrimination. No significant movement to rightful places has been realized by former discriminatees, although some movement has been accomplished. 43 Thus some relief is warranted, and the district court was in error in denying such relief. We applaud, however, the district court's management of these complex issues as well as I.P.'s attempt to advance its discriminatees into and up other lines of progression in the production departments. We recognize that although I.P. was initially culpable, it was not individually so. The respective, then-segregated, unions must share liability for the discriminatory past conduct. Indeed, even since 1968, affected class movement has been partially frustrated by positions adopted by the unions, although at least UPIU has recently expressed a willingness to effectuate whatever remedies the court should impose. 44 54 On remand the court should insure full wage protection to affected class members who exercise transfer opportunities by: extending red circle ceilings to average hourly rates, inclusive of temporary set-ups, over a reasonable period of time immediately preceding the transfer, or to permanent wage rates of the employee, whichever is higher, including therein a factor for future adjustments for cost-of-living or contract renegotiation wage increases and by extending coverage to every member of the affected class. Such provisions should be accompanied with an order for full publication, dissemination, and explanation of the terms of the court's decree. Additionally, red circle protections should extend to affected class members who transfer to maintenance craft positions. The district court should require that I.P. demonstrate which jobs provide essential training for progression and are supported by business necessity and which jobs, if any, could be skipped upon entry and promotion. The court should also review the lengths of the residency requirements to determine whether they are the least restrictive means to accomplish their purpose and consider whether functionally equivalent experience in former lines of progression may satisfy those requirements. Finally, the court should review I.P.'s administration of its policy of advancement of affected class members to their rightful place in light of I.P.'s military rightful place policy, with a view toward rendering whole these former discriminatees as expeditiously as possible and to the same extent that it now accords a rightful place to returning service men. Provisions of this relief should be made available to all affected class members regardless of whether they have declined transfer offers in the past. If these conditions are fully implemented, the need for a back pay award will be obviated. 55