Zichy v. City of Philadelphia

• Citation: 590 F.2d 503
• Decision Date: 05 January 1979
• Docket Number: No. 78-1223,78-1223
• Parties: 34 Fair Empl.Prac.Cas. 1381, 18 Empl. Prac. Dec. P 8846 Kathleen ZICHY and Jane E. Schofer, Appellants, v. The CITY OF PHILADELPHIA, Appellee.
• Court: United States Courts of Appeals. United States Court of Appeals (3rd Circuit)

Page 503

590 F.2d 503

34 Fair Empl.Prac.Cas. 1381, 18 Empl. Prac.

Dec. P 8846

Kathleen ZICHY and Jane E. Schofer, Appellants, v. The CITY OF PHILADELPHIA, Appellee.

No. 78-1223.

United States Court of Appeals, Third Circuit.

Argued Sept. 29, 1978.

Decided Jan. 5, 1979.

Susan Cary Nicholas, Alice M. Price, Philadelphia, Pa., for appellants.

John M. McNally, Jr., Sheldon L. Albert, Philadelphia, Pa., for appellee.

Benjamin G. Lipman, Philadelphia, Pa., for Pennsylvania Human Relations Commission, as amicus curiae.

Before SEITZ, Chief Judge, HUNTER, Circuit Judge, and LACEY, ^* District Judge.

OPINION OF THE COURT

JAMES HUNTER, III, Circuit Judge:

In this class action, plaintiffs challenge the City of Philadelphia's policy on pregnancy-related leave for city employees. On appeal, plaintiffs request that we reverse the district court's denial of their motion to amend the Complaint to add a claim based on state law. Plaintiffs also ask that we narrow a prior decision of this court which dismissed these plaintiffs' Title VII claims. In light of the Supreme Court's recent decision in Nashville Gas Co. v. Satty, 434 U.S. 136, 98 S.Ct. 347, 54 L.Ed.2d 356 (1977), we will remand to the district court for reconsideration of the Title VII claims and, therefore, the motion to amend the Complaint.

I.

Plaintiff class consists of female employees of the City of Philadelphia affected by the City's pregnancy-related, or maternity, leave policy. ¹ The action was first brought under the equal protection and due process clauses of the Constitution and under the Civil Rights Act of 1871, 42 U.S.C. § 1983 (1976). Later, plaintiffs amended the Complaint to add Title VII of the Civil Rights Act of 1964, 42 U.S.C. §§ 2000e to 2000e-17 (1976), as additional support. ² They contended that the City's policy discriminated against female employees because women on maternity leave were treated differently in the compensation, terms, and conditions of their employment from employees on ordinary sick leave. Further, they contended that treating women on maternity leave differently from employees on sick leave created a classification which adversely affected the status of female employees because of sex.

Sick leave and maternity leave are governed by section 21 of the Philadelphia Civil Service Regulations. Employees on sick leave continue to earn their normal salary and accrue seniority. They do not lose the opportunity to take promotional examinations, have the time out credited for service, and receive the same raises as other employees in the same classification who were not out on sick leave. Seniority continues to accumulate; the same job position remains open to employees when they return from sick leave; and fringe benefits are not affected. The woman on maternity leave, however, receives no pay during the period of absence. She accumulates neither seniority, sick leave, nor vacation time. Her anniversary date is deferred, and she is subject to a lower rate of pay for pension purposes. Zichy v. City of Philadelphia, 392 F.Supp. 338, 340-42 (E.D. Pa. 1975). See also Defendant's Answers to Plaintiffs' Interrogatories at PP 1, 2, 28, 63, & 72.

Finding no factual dispute over the provisions of the City's pregnancy-related leave policy, on March 19, 1975 the district court entered summary judgment in favor of the plaintiff class. The district court concluded "that defendant's policy of denying the use of sick leave for maternity-related disabilities violates Title VII's prohibition against sexual discrimination in employment." 392 F.Supp. at 347.

While the City's appeal was under consideration in this court, the Supreme Court decided General Electric Co. v. Gilbert, 429 U.S. 125, 97 S.Ct. 401, 50 L.Ed.2d 343 (1976). There, the Court held that an employer's disability plan which did not cover pregnancy-related disabilities was not a per se violation of Title VII. After Gilbert, we held in EEOC v. Children's Hospital of Pittsburgh, 556 F.2d 222 (3d Cir. 1977), Cert. denied, 434 U.S. 1009, 98 S.Ct. 718, 54 L.Ed.2d 751 (1978), that an employer's policy of prohibiting female employees from using accumulated sick leave for pregnancy-related disabilities did not violate Title VII. On the basis of Gilbert and Children's Hospital, this court reversed the district court's award of summary judgment for these plaintiffs, effectively dismissing all of their Title VII claims. We remanded "for the sole purpose of affording appellees an opportunity of presenting a proposed amendment to the complaint" to add a state law claim based on the Pennsylvania Human Relations Act, Pa. Stat. Ann. tit. 43, § 955 (Purdon 1964 & Supp. 1978). Zichy v. City of Philadelphia, 559 F.2d 1210 (3d Cir. 1977).

On remand, the district court denied the plaintiffs' motion to amend the complaint to add a state law claim. While assuming that it had the power under the doctrine of pendent jurisdiction to permit the amendment, the court declined to exercise its discretion to do so. 444 F.Supp. 344 (E.D. Pa. 1977).

II.

Plaintiffs contend that the June 28, 1977, opinion of this court which reversed the award of summary judgment to the plaintiffs was overly broad. They claim that they had made numerous allegations of discrimination based on Title VII which were not affected by Gilbert. In the Amended Complaint, which has not been changed since the prior appeal, plaintiffs state that the City's maternity leave policy:

a) discriminate(s) against plaintiff and other female persons in this class because of sex with respect to compensation, terms, conditions and privileges of employment, and b) limit(s), segregate(s) and classifi(es) employees of Defendant in ways which deprive Plaintiffs and other female persons in this class of equal employment opportunities and otherwise adversely affect their status as employees because of sex.

Complaint at P 2. These two allegations essentially track the language of sections 703(a)(1) and (2) of Title VII. ³ Further, plaintiffs contend that the City's policy "regarding Maternity leave . . . arbitrarily distinguishes such leave from all types of Leaves of Absence Without Pay" and causes "female employees to lose seniority and benefits upon returning to work from an absence due to a temporary disability." Complaint at P 26(d) and (e). Plaintiffs focus on two aspects of the City's pregnancy-related leave policy. First, they challenge the City's refusal to allow the use of accumulated sick leave for maternity leave. Second, they assert that the City's policy imposes impermissible burdens on female employees, essentially by refusing to allow their time on maternity leave to count toward benefits.

Plaintiffs first complain that the City's policy of denying the use of accumulated sick leave to employees on maternity leave violates Title VII. In December, 1976 the Supreme Court held in Gilbert that the exclusion of pregnancy from the range of disabilities covered by an employer's disability plan is not a per se violation of Title VII. The Court analyzed the plan under section 703(a)(1), which prohibits discrimination on the basis of sex "with respect to . . . compensation, terms, conditions, or privileges of employment." The record disclosed that, even excluding pregnancy-related disabilities, the plan cost the employer at least as much per female employee as per male employee. In finding no discrimination in compensation, the Court held that the plan was facially neutral: "As there is no proof that the package is in fact worth more to men than to women, it is impossible to find any gender-based discriminatory effect in this scheme simply because women disabled as a result of pregnancy do not receive benefits." 429 U.S. at 138, 97 S.Ct. at 409. Because there was no showing that the exclusion of pregnancy from the plan was a "pretext designed to effect an invidious discrimination against the members of one sex or the other," Id. at 136, 97 S.Ct. at 408, Quoting Geduldig v. Aiello, 417 U.S. 484, 496-97 n. 20, 94 S.Ct. 2485, 41 L.Ed.2d 256 (1974), nor a showing of discriminatory effect, the Court found no Title VII violation under section 703(a)(1).

In December, 1977 the Supreme Court in Nashville Gas Co. v. Satty, 434 U.S. 136, 98 S.Ct. 347, 54 L.Ed.2d 356 (1977), analyzed under section 703(a)(2) disability plans which exclude pregnancy-related disabilities. There, pregnant employees were required to take a formal leave of absence. The employees did not receive sick pay while on maternity leave. Further, employees who took maternity leave also lost all accumulated job seniority. The Satty court considered the legality of an employer's refusal to allow employees on maternity leave to use accumulated sick leave. It noted that "it is difficult to perceive how exclusion of pregnancy from a disability insurance plan or sick-leave compensation program" could interfere with individual employment opportunities or adversely affect a woman's status as an employee under section 703(a)(2) since "(t)he direct effect of the exclusion is merely a loss of income for the period the employee is not at work." 434 U.S. at 144-45, 98 S.Ct. at 352. The Court remanded to give the employee the opportunity to demonstrate that the facially neutral plan had a discriminatory intent.

The City's disability plan also appears to be facially neutral in this respect, suffering, as in Gilbert and Satty, only from underinclusiveness. Moreover, "the burden is on the plaintiff to show that the plan discriminates on the basis of sex in violation of Title VII." 434 U.S. at 144, 98 S.Ct. at 352. We leave it to the district court to determine on remand whether the plaintiffs have made sufficient allegations of discriminatory effect or intent to preserve their right to challenge the denial of the use of sick leave for pregnancy-related disabilities under the standards of Gilbert and Satty. We must recognize, however, that such a claim would be difficult to prove given the...