Supreme Court Cases: customer discrimination

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Supreme Court Cases customer discrimination

• Dias vs Pan Am (1971)
• Celio Diaz applied for a job as flight cabin
  attendant with Pan American Airlines in 1967. He
  was rejected because Pan Am had a policy of
  restricting its hiring for that position to
  females. Pan Am argued that customers preferred
  female flight attendants.
• Court ruled customer preference was not a bona
  fide exception

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Supreme Court Cases Marriage, fertility

• UAW v. Johnson Controls (1991)
• Court rules illegal a company policy barring all
  women of childbearing age from jobs involving
  actual or potential exposure to lead in amounts
  exceeding OSHA recommended levels. Women who
  wanted to work in these positions were required
  to submit medical documentation of inability to
  bear children.
• More generally, marital status must be shown to
  be a BFOQ and must apply equally to men and women
• G.E. vs Gilbert (1976)
• Pregnancy was excluded from company disability
  plan. Ruling stipulates that pregnancy must be
  treated the same as any other medical condition.
• 1978 Pregnancy Discrimination Act

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Supreme Court Cases Seniority

• Franks vs Bowman Transportation (1976)
• If discrimination led protected groups to lose
  seniority, Court can give retroactive seniority
• Teamsters vs U.S. (1977)
• Retiractive seniority can only aply to
  discrimnatory behavior that occurred after the
  1964 passage of Title VII

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Supreme Court Cases Physical Stuture

• Dothard vs Rawlinson (1977)
• After being denied employment as a correctional
  counselor because of inadequate weight, Dianne
  Rawlinson brought a class action against
  appellant corrections officials challenging the
  statutory height and weight requirements (5-2
  to 6-10 120-300 lbs.). The standards excluded
  41 of the female population but less than 1 of
  the male population.
• The prison failed to show that workers outside
  the stature requirements could not meet the
  requisite strength requirements, and so they did
  not meet the standards of a legitimate BFOQ.
  However.

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Supreme Court Cases Physical Stuture

• Dothard vs Rawlinson (1977)
• Alabamas four maximum-security male
  penitentiaries did not classify or segregate
  inmates according to their offense or level of
  dangerousness. The estimated 20 of the male
  prisoners who are sex offenders are scattered
  throughout the system, and the facilities were
  essentially dormitories. The use of women as
  guards in "contact" positions under the existing
  conditions in Alabama maximum-security male
  penitentiaries would pose a substantial security
  problem, directly linked to the sex of the
  prisonguard.

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Supreme Court Cases Layoffs

• Firefighters v. Stotts (1984)
• Layoffs based on seniority are ok, even if they
  lay off protected groups disproportionately
• Exception if low seniority was due to past
  discrimination

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Supreme Court Cases Pensions and Benefits

• City of Los Angeles v. Manhart (1978)
• Court ruled illegal the Department's pension plan
  was based on mortality tables and its own
  experience showing that female employees had
  greater longevity than male employees. The cost
  of a pension for the average female retiree was
  greater than for the average male retiree because
  more monthly payments had to be made to the
  female, and so women were charged 15 more for
  the pension.
• Department had to reimburse the past extra
  payment

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Supreme Court Cases Pensions and Benefits

• Arizona Governing Committee vs. Norris (1983)
• Under the States retirement plan, employees had
  the option of receiving retirement benefits from
  one of several companies selected by the State,
  all of which pay lower monthly retirement
  benefits to a woman than to a man who has made
  the same contributions.
• Court ruled that payments had to be equal.
• OK for firm to pay out dollar value at retirement
• OK for firm to pay into retirement plan that
  worker controls (401K).

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Supreme Court Cases Sexual Harassment

• Meritor Savings Bank vs Vincent (1986)
• After being fired by Meritor Savings Bank,
  Mechelle Vinson sued for damages saying that she
  had been subjected to sexual harassment that
  constituted a hostile working environment. Sidney
  Taylor, VP, had coerced her to have sexual
  relations, had touched her in public, exposed
  himself,
• Court ruled that sexual harassment is a violaton
  of Title VII if it is unwelcome and sufficiently
  severe or pervasive to alter the conditions or
  privileges of employment.

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Supreme Court Cases Sexual Harassment

• Harris vs Forklift Systems Inc (1993)
• Teresa Harris had worked for two years as rental
  manager. She filed a complaint alleging that the
  company's president, Charles Hardy, had created a
  hostile work environment by, among other things,
  calling her names and asking her to retrieve
  coins from his front pants pocket. A federal
  district court in Tennessee had found that Harris
  was not protected by Title VII since she had not
  suffered any psychological injury on the job.
• Court ruled that it was not necessary to show
  psychological damage or that job performance had
  suffered. Furthermore,
• The measure to be used in such cases was whether
  the harassment had the effect of altering the
  conditions of the working place, a condition or
  privilege of employment.

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Supreme Court Cases Sexual Harassment

• Burlington Industries, Inc. v. Ellerth (1998)
• From March 1993 until May 1994, Kimberly Ellerth
  was a salesperson in one of Burlingtons
  divisions in Chicago. She alleges, she was
  subjected to constant sexual harassment by her
  supervisor, one Ted Slowik.
• According to Slowiks supervisor, his position
  was not considered an upper-level management
  position, and he was not amongst the
  decision-making or policy-making hierarchy.
  Ellerth did not argue that the supervisor or
  other higher managers were aware of Slowiks
  actions.
• an employee who refuses the unwelcome and
  threatening sexual advances of a supervisor, yet
  suffers no adverse, tangible job consequences,
  can recover against the employer without showing
  the employer is negligent or otherwise at fault
  for the supervisors actions.

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Other Stipulations

• Advertising jobs
• Education
• Arrest and conviction records
• Credit rating
• Age comes under the Age Discrimination in
  Employment Act. People over 40 covered.
• State protective laws covering hours, lifting
  weights, occupations, superseded by Title VII

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Title VII as a response to discrimination in
internal labor markets

• The Act and subsequent court cases have created a
  manual on what firms can and cannot do in hiring,
  compensation, promotion, and other conditions and
  privileges of employment.
• Example Handout from SHRM on legal questions in
  interviews

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Anti Discrimination Legislation

• Affirmative Action Executive Order (1965, 1968,
  1971)
• Requires that contractors take
• "affirmative action to ensure that applicants are
  employed, and that employees are treated during
  employment without regard to their race, color,
  religion, sex, or national origin."
• 1971 "set numerical goals and timetables to
  correct deficiencies."

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Affirmative Action coverage and requirements

• Federal contractors, subcontractors and
  educational institutions
• 50 workers and/or 50,000 in contracts
• Firms must compare their own mix of workers by
  occupation against the mix in the labor market
  (local for less skilled, national for more
  skilled)
• Identify underrepresentation
• Set goals and timetables
• Good Faith Effort

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Affirmative Action Enforcement

• Office of Federal Contract Compliance (OFCC)
• Reviews plans vs. statistical data on relevant
  populations
• Checks for Good Faith Effort to make progress on
  goals
• Penalties
• Back pay and mandated corrections
• Delayed contracts
• Debarments
• Federal court ordered plans with contempt of
  court possible for noncompliance

17
Supreme Court Cases Voluntary quotas

• Bakke vs University of California at Davis (1978)
• UC Davis reserved 16 of 100 slots in the medical
  school for minorities
• Bakke had higher GPA and MCAT scores than some
  admitted minorities
• Supreme Court ruled that absent evidence of past
  discrimination, ongoing quotas violate Title VII.
  
• Note quotas may be mandated as a corrective
  action in cases where discrimination is found.
• Minority status can be used as a factor in
  admission

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Supreme Court Cases Voluntary quotas

• Steelworkers vs Weber (1979)
• Only 2 of Kaiser Aluminums skilled craft
  workers were Black, even though the population
  around Kaisers plants were 39 Black.
• Kaiser entered into a master collective
  bargaining agreement including an affirmative
  action plan, reserving for black employees 50 of
  the openings in in-plant craft training programs
  until the percentage of black craft workers
  matched that in the local workforce.
• Several more junior Black workers received
  training ahead of more senior White workers.

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Supreme Court Cases Voluntary quotas

• Steelworkers vs Weber (1979)
• Brian Weber, one of those white production
  workers, instituted a class action suit alleging
  discrimination against Whites.
• Supreme Court overturned lower court rulings
  favoring Weber because
• Title VII does not prohibit voluntary
  race-conscious affirmative action where it is
  necessary to eliminate conspicuous racial
  imbalance in traditionally segregated job
  categories
• the affirmative action plan was voluntarily
  adopted by private parties to eliminate
  traditional patterns of racial segregation, and
  Weber was represented in the negotiation by his
  union.
• Plan was temporary to correct imbalances
• Plan did not displace incumbents
• Plan did not unduly impede majority

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Supreme Court Cases Voluntary promotion
preferences

• Johnson vs Santa Clara County Transportation
  Agency (1987)
• Transportation Agency created an affirmative
  action plan to bring about representation equal
  to the labor force proportions of women,
  minorities, and disabled. While program was
  justified as redressing past harm to groups
  facing discrimination, the Agency had not been
  accused of discriminatory practice.
• Paul Johnson applied for a promotion to a skilled
  craft worker category. Although he scored
  highest on the evaluation process, the promotion
  went to Diana Joyce.
• Johnson sues alleging violation of Title VII.

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Supreme Court Cases Voluntary promotion
preferences

• Johnson vs Santa Clara County Transportation
  Agency (1987)
• Supreme Court rules against Johnson
• voluntary sex-conscious affirmative action does
  not violate Title VII where it is necessary to
  eliminate a manifest imbalance that reflects
  underrepresentation of women in traditionally
  segregated job categories
• Plan recognized gender as only one of several
  factors in decisions about hiring and promotion.
• temporary means to overcome past discrimination
  against workers based on sex.
• The Agency Plan did not unnecessarily trammel
  male employees' rights or create an absolute bar
  to their advancement.

22
Texas 5th District on Admissions Preferences

• Hopwood vs. Texas (1996)
• Cheryl Hopwood, a white female, alleged that she
  was denied admission to the University of Texas
  Law School despite being better qualified than
  many admitted minority candidates.
• 5th Circuit ruled that race cannot be used
  explicitly as a factor in admissions.
• U.of Texas changed admissions policies. Fdor
  undergraduates, they admit the top 10 of each
  high school class. For Law, preference for lower
  income applicants
• Because U.of Texas no longer maintained the
  policy, Supreme Court refused to rule on the case.

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Impact of Hopwood

• U of Texas freshman Admissions
• Black Hispanic Asian White
• Pre-Hopwood 4 14 15 65
• Post-Hopwood 3 14 20 61

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Supreme Court University Admissions

• Grutter v. Bollinger (2003)
• Barbara Grutter, a white Michigan resident with a
  3.8 GPA and 161 Law School Admissions Test (LSAT)
  score, was rejected by the University of Michigan
  Law School. She alleged that the university had
  discriminated against her on the basis of race in
  violation of the equal protection clause of the
  Fourteenth Amendment to the United States
  Constitution and Title VII of the Civil Rights
  Act of 1964.
• Court rule that Title VII "does not prohibit the
  law school's narrowly tailored use of race in
  admissions decisions to further a compelling
  interest in obtaining the educational benefits
  that flow from a diverse student body."

25
Supreme Court University Admissions

• Gratz v. Bollinger (2003)
• The University of Michigan used a 150-point scale
  to rank applicants, with 100 points needed to
  guarantee admission. The University gave
  "underrepresented" ethnic groups, including
  African-Americans, Hispanics, and Native
  Americans, an automatic 20-point bonus on this
  scale, while a perfect SAT score was worth only
  12 points.
• Jennifer Gratz and Patrick Hamacher, both white
  residents of Michigan, applied for and were
  denied admission to the University of Michigans
  undergraduate program in liberal arts.
• Court ruled that, because the University's use of
  race in its current freshman admissions policy is
  not narrowly tailored to achieve respondents'
  asserted compelling interest in diversity, the
  admissions policy violates the Equal Protection
  Clause of the Fourteenth Amendment.

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EEOC enforcement
27
In 1973, sex-related discrimination complaints
rose to 32 for the first time
Claudia Goldin, Understanding the Gender Gap An
Economic History of American Women, 1990
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Title VII of the Civil Rights Act of 1964 (Title
VII) The Americans with Disabilities Act of 1990
(ADA) The Age Discrimination in Employment Act of
1967 (ADEA) The Equal Pay Act of 1963 (EPA)
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Types of EEOC case resolutions

• Administrative Closure Charge closed for failure
  to locate charging party, charging party failed
  to respond to EEOC communications, charging party
  refused to accept full relief, closed due to the
  outcome of related litigation, charging party
  requests withdrawal of a charge without receiving
  benefits or having resolved the issue, no
  statutory jurisdiction.
• Merit Resolutions Charges with outcomes favorable
  to charging parties that include negotiated
  settlements, withdrawals with benefits,
  successful conciliations, and unsuccessful
  conciliations.
• No Reasonable Cause EEOC determines no reasonable
  cause to believe that discrimination occurred
  based upon evidence obtained in investigation.
  The charging party may exercise the right to
  bring private court action.

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Source http//www.eeoc.gov/stats/vii.html
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• The "rapid charge processing" program introduced
  by EEOC Commissioner Eleanor Holmes Norton in
  1977 sought quick settlement of cases prior to
  full investigation. This program relied on
  no-fault settlement agreements with the agency in
  return for payment of some money or other benefit
  to the charging party. Allowed EEOC to focus on
  large class action suits
• Large external impact as lesson to ther firms
• Her successor Clarence Thomas implemented a full
  investigation policy. All charges were to be
  fully investigated to a determination of
  "reasonable cause" to believe that there had been
  a violation of the law or a "no reasonable cause"
  determination. Emphasis shifts to individual
  cases with identifiable victims.
• Small external impact

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• Mediation has been widely praised by both
  charging parties (i.e., employees) and
  respondents (i.e., employers) as an effective and
  efficient way to resolve their employment
  discrimination disputes and increasing the
  likelihood that the parties can continue an
  employment relationship.

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EEOC Budget and FTEs Constraints on enforcement
Proposed As of Dec. 2005 SOURCES Office of
Management and Budget, Office of Personnel
ManagementWashington Post, June 14, 2006
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Enforcement of Affirmative Action

• Debarments rarely used 27 in first 20 years of
  Affirmative Action
• Most reinstated within one year
• Staffing is too small to investigate all firms,
  although most checks are electronic

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Impact on Hiring and QualificationsAverage skill
in the absence of hiring preferences would be µ
in each sector. Suppose instead that Federal
Contractors have a preference for hiring
protected classes (P). They lower hiring
standards qP for P and only hire white males (WM)
if they are atypically strong, (qWM or higher).
NonFederal sector hires everyone who does not get
a job in the Federal Contractor Sector, and so
average white male skills there are also higher
NonFederal Contractors
Federal Contractors
µP
µWM
qWM
qP
Skill
Skill
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Result

• Should have average qualifications of white males
  exceeding that of other groups in the Federal
  Contractor sector.
• Same will be true in the noncontractor sector as
  Federal Contractors will bid away the best
  protected class workers away from noncontractors.
• Does this happen? Evidence is mixed

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