Alabama Power Company v. Davis

• Decision Date: 06 June 1977
• Docket Number: No. 76-451,76-451
• Citation: 52 L.Ed.2d 595,97 S.Ct. 2002,431 U.S. 581
• Parties: ALABAMA POWER COMPANY, Petitioner, v. Raymond E. DAVIS
• Court: U.S. Supreme Court

431 U.S. 581

97 S.Ct. 2002

52 L.Ed.2d 595

ALABAMA POWER COMPANY, Petitioner,

v Raymond E. DAVIS.

No. 76-451.

Argued April 25, 1977.

Decided June 6, 1977.

Syllabus

Respondent, who left employment with petitioner for military service but who returned after completion of such service and continued in employment until his retirement, held entitled under § 9 of the Military Selective Service Act, which requires an employer to rehire a returning veteran without loss of seniority, to credit toward his pension under petitioner's pension plan for his period of military service. Pp. 583-594.

(a) A benefit is a right of seniority secured to a veteran by § 9 if it would have accrued with reasonable certainty, as opposed to being subject to a significant contingency, had the veteran been continuously employed by the employer, McKinney v. Missouri-K.-T. R. Co., 357 U.S. 265, 78 S.Ct. 1222, 2 L.Ed.2d 1305; Tilton v. Missouri Pac. R. Co., 376 U.S. 169, 84 S.Ct. 595, 11 L.Ed.2d 590, and if it is in the nature of a reward for length of service rather than short-term compensation for services rendered, Accardi v. Pennsylvania R. Co., 383 U.S. 225, 86 S.Ct. 768, 15 L.Ed.2d 717; Foster v. Dravo Corp., 420 U.S. 92, 95 S.Ct. 879, 43 L.Ed.2d 44. Pp. 585-589.

(b) Here, not only is the "reasonable certainty" requirement met on the basis of respondent's work history both before and after his military service, but it also appears that the "true nature" of the pension payments is a reward for length of service, especially in view of the lengthy period (20 years or 15 years if age 50) required by the pension plan for pension rights to vest in the employee. Pp. 591-594.

(c) Moreover, respondent's claim is supported by the functions of pension plans in assuring financial security for long-term employees and, by providing such security, in encouraging such employees to retire when their efficiency declines. P. 594.

542 F.2d 650, affirmed.

Allan A. Ryan, Jr., Washington, D. C., for respondent.

H. Hampton Boles, Birmingham, Ala., for petitioner.

Mr. Justice MARSHALL delivered the opinion of the Court.

Respondent Davis became a permanent employee of petitioner Alabama Power Co. on August 16, 1936, and continued to work until March 18, 1943, when he left to enter the military. After serving in the military for 30 months, he resumed his position with Alabama Power, where he worked until he retired on June 1, 1971. Davis received credit under the company pension plan for his service from August 16, 1937,¹ until the date of his retirement, with the exception of the time he spent in the military and some time spent on strike. Davis claimed that § 9 of the Military Selective Service Act of 1967, 50 U.S.C. App. § 459(b),² requires Alabama Power to give him credit toward his pension for his period of military service. With the assistance of the United States Attorney,³ he sued to vindicate that asserted right. The District Court, 383 F.Supp. 880 (N.D.Ala.1974), and the Court of Appeals for the Fifth Circuit, 542 F.2d 650 (1976), agreed with Davis. Because of the importance of the issue and a conflict among the Circuits,⁴ we granted certiorari, 429 U.S. 1037, 97 S.Ct. 731, 50 L.Ed.2d 748.⁵ We affirm.

I

The Military Selective Service Act provides the mechanism for manning the Armed Forces of the United States. Section 9 of the Act evidences Congress' desire to minimize the disruption in individuals' lives resulting from the national need for military personnel. It seeks to accomplish this goal by guaranteeing veterans that the jobs they had before they entered the military will be available to them upon their return to civilian life. Specifically, § 9 requires that any qualified person who leaves a permanent position with any employer to enter the military, satisfactorily completes his military service, and applies for re-employment within 90 days of his discharge from the military,

"be restored by such employer or his successor in interest to such position or to a position of like seniority, status, and pay . . . unless the employer's circumstances have so changed as to make it impossible or unreasonable to do so." 50 U.S.C. App. § 459(b)(B)(i).

Moreover, any person so restored to a position

"shall be considered as having been on furlough or leave of absence during his period of training and service in the armed forces, shall be so restored without loss of seniority, shall be entitled to participate in insurance or other benefits offered by the employer pursuant to established rules and practices relating to employees on furlough or leave of absence in effect with the employer at the time such person was inducted into such forces, and shall not be discharged from such position without cause within one year after such restoration." 50 U.S.C.App. § 459(c)(1).

In our first confrontation with the predecessor of § 9,⁶ we held that the statutory protection against discharge within a year of re-employment did not protect a veteran from being laid off while nonveterans with greater seniority retained their jobs. Fishgold v. Sullivan Drydock & Repair Corp., 328 U.S. 275, 66 S.Ct. 1105, 90 L.Ed. 1230 (1946). In reaching this conclusion, we announced two principles that have governed all subsequent interpretations of the re-employment rights of veterans. First, we stated that under the Act:

"(The veteran) does not step back on the seniority escalator at the point he stepped off. He steps back on at the precise point he would have occupied had he kept his position continuously during the war." Id., at 284-285, 66 S.Ct., at 1111.

Congress incorporated this doctrine in succeeding re-enactments of the re-employment provision. See 50 U.S.C. App. § 459(c)(2).⁷ The second guiding principle we identified was:

"This legislation is to be liberally construed for the benefit of those who left private life to serve their country in its hour of great need. . . . And no practice of employers or agreements between employers and unions can cut down the service adjustment benefits which Congress has secured the veteran under the Act." 328 U.S., at 285, 66 S.Ct., at 1111.

Our next cases were also concerned with the extent of the protection afforded rights that were clearly within the Act's scope. Trailmobile Co. v. Whirls, 331 U.S. 40, 67 S.Ct. 982, 91 L.Ed. 1328 (1947); Aeronautical Industrial Dist. Lodge 727 v. Campbell, 337 U.S. 521, 69 S.Ct. 1287, 93 L.Ed. 1513 (1949); Oakley v. Louisville & N. R. Co., 338 U.S. 278, 70 S.Ct. 119, 94 L.Ed. 87 (1949). More recently, however, our efforts have been directed at determining whether a particular right claimed by a veteran is an aspect of the "seniority" which the Act protects. We have been unable to rely on either the language or the legislative history of the Act when making these determinations, for neither contains a definition of "seniority."

We first faced this problem in McKinney v. Missouri-K.-T. R. Co., 357 U.S. 265, 78 S.Ct. 1222, 2 L.Ed.2d 1305 (1958). McKinney had been re-employed at a higher level than he had attained when he left for military service, with seniority in his new position dating from his return to work. When his job was abolished, he claimed that his seniority at the higher level should have dated from the time he would have been eligible to reach that level had he not served in the military. This Court rejected his claim because of the contingent nature of his expectation of being promoted from the job he previously held. That promotion, the Court found, depended "not simply on seniority or some other form of automatic progression, but on the exercise of discretion on the part of the employer." Id., at 272, 78 S.Ct., at 1227. Since the promotion would not have come automatically had McKinney continued to ride the seniority escalator, the Court concluded that neither the promotion nor a seniority date calculated as of the time he might have been promoted were incidents of the "seniority" protected by the Act.⁸

Six years later, the Court again considered whether a veteran was entitled to a seniority date calculated as if he had obtained a higher level position while in the military. Tilton v. Missouri Pac. R. Co., 376 U.S. 169, 84 S.Ct. 595, 11 L.Ed.2d 590 (1964). Tilton had been promoted before he left the railroad to enter the military, but he had not worked enough days to complete the probationary period necessary to obtain permanent status and begin accumulating seniority in the higher level job. When he returned to the railroad, he successfully completed the remainder of the probationary period. The company set his seniority date as of the time he actually finished the probationary period; he claimed that the date should have been fixed as of the time he would have satisfied the probationary work requirement had it not been for his military service.

This Court agreed. Unlike the situation in McKinney, we found that the only management discretion involved was the decision to allow Tilton to assume probationary status in the higher level position, and that discretion had been exercised before he entered the military. Tilton's satisfactory completion of the probationary period after he was reinstated by the railroad was sufficient indication that he would have completed that period earlier if his tenure had not been interrupted by his service to his country. The mere possibility that his ride on the escalator might have been interrupted by some other circumstance could not be allowed to deny him the status he almost certainly would have obtained:

"In every veteran seniority case the possibility exists that work of the particular type might not have been avail- ables that the veteran would not have worked satisfactorily during the period of his absence; that he might not have elected to accept the higher position; or that sickness might have prevented him from continuing his employment. In light of the purpose and history of this statute, however, we cannot assume that Congress...