Anderson v. Zubieta

• Decision Date: 02 July 1999
• Docket Number: No. 97-5247,97-5247
• Citation: 180 F.3d 329
• Parties: Vicente J. ANDERSON, et al., Appellants, v. Alberto Aleman ZUBIETA, Appellee.
• Court: U.S. Court of Appeals — District of Columbia Circuit

180 F.3d 329

Vicente J. ANDERSON, et al., Appellants, v. Alberto Aleman ZUBIETA, Appellee.

No. 97-5247.

United States Court of Appeals, District of Columbia Circuit.

Argued Sept. 3, 1998.

Decided July 2, 1999.

Appeal from the United States District Court for the District of Columbia (No. 96cv02832).

Richard J. Hirn argued the cause for appellants. With him on the briefs was Ernest Allen Cohen.

Kimberly N. Brown, Assistant U.S. Attorney, argued the cause for appellee. With her on the brief were Wilma A. Lewis, U.S. Attorney, and R. Craig Lawrence, Assistant U.S. Attorney.

Before: SENTELLE, HENDERSON and GARLAND, Circuit Judges.

Opinion for the Court filed by Circuit Judge GARLAND.

GARLAND, Circuit Judge:

Plaintiffs are black American citizens of Panamanian or Hispanic national origin who have long worked for the Panama Canal Commission and its predecessor, the Panama Canal Company (together, the "PCC" or "Canal Commission"). The PCC pays them substantially less in salary and benefits than it pays other American citizens working at the same jobs--the overwhelming majority of whom are white, non-Panamanians. The plaintiffs allege this pay differential constitutes race and national origin discrimination in violation of Title VII of the Civil Rights Act of 1964, Pub.L. No. 88-352, 78 Stat. 241 (codified as amended at 42 U.S.C. §§ 2000e to 2000e-17 (1994)). The district court granted summary judgment in favor of the PCC and dismissed plaintiffs' complaint. We reverse.

I

The Canal Commission is a wholly-owned United States government corporation. The thirteen plaintiffs were hired by the PCC before 1979, and all but two before 1976. Compl. pp 4-16. One has since retired. Id. All the plaintiffs are currently United States citizens: eleven were naturalized between 1987 and 1994; one became a citizen in 1977 following his service in the military; and the remaining plaintiff is the son of a United States citizen whose citizenship was not registered with the U.S. Embassy until 1991. Id. The PCC denies plaintiffs three types of benefits that it grants to other employees, which generates the pay differential of which they complain.

The first benefit is the so-called "tropical differential," the current version of which was authorized by Congress in the Panama Canal Act of 1979, 22 U.S.C. § 3657. The differential, paid as a "recruitment or retention" incentive, is a 15% increment above the employee's basic pay. Id. § 3657(a); see 35 C.F.R. § 251.31(a). Under the statute it is available to "any" employee who meets the eligibility requirements, without reference to the nature of the employee's job. Anyone employed before October 1, 1979 ¹ is statutorily eligible for the benefit, regardless of citizenship or place of recruitment, as is anyone recruited after that date from outside Panama. 22 U.S.C. § 3657(a). Because all plaintiffs were employed before October 1, 1979, all are eligible under the statutory criteria.

The Canal Commission, however, has chosen to restrict eligibility further than Congress required. Under the PCC's regulations, only American citizens are eligible for the tropical differential. 35 C.F.R. § 251.31(a). Moreover, employees hired from within Panama ("Panamanian hires") are eligible only if they also come within a "grandfather clause" the PCC adopted in 1976--which requires that they were employed and receiving the differential no later than July 3, 1976. See id. § 251.31(c). This effectively limits the eligibility of Panamanian hires to those who already were American citizens on that date. ² This requirement disqualifies all of the plaintiffs.

The second benefit is known as the "equity adjustment package," and consists of free rent and electricity in PCC housing, as well as certain travel and educational benefits. Pls. Br. at 15. For many years, the PCC operated subsidized stores where employees who were American citizens could purchase goods at prices below those available elsewhere in Panama. See PCC Cross-Motion (Dist. Ct. Record Entry [hereinafter "R."] 13), Ex. 37. As part of the Panama Canal Treaty of 1977, the United States agreed to close those stores. PCC citizen-employees, however, were permitted to shop in military commissaries for a limited period of time ending September 30, 1984. Effective October 1, 1984, Congress authorized an allowance for any U.S. citizen (as of the time the benefits are received) who was employed on September 30, 1979, regardless of place of recruitment. The allowance was also authorized for anyone recruited after September 30, 1979 from outside Panama, regardless of citizenship. 22 U.S.C. § 3646. From 1984-89, five plaintiffs were eligible under these statutory criteria and received the equity package benefits.

On December 29, 1989, the last American administrator of the Canal changed the PCC's policy and imposed additional eligibility requirements on Panamanian hires. Under these new criteria, an employee hired from within Panama is eligible for the equity package only if he or she was employed on September 30, 1979 and was a citizen before October 1, 1984. See PCC Cross-Motion (R. 13), Exs. 20, 54. As a consequence of the new criteria, four plaintiffs who had been receiving the equity package lost their benefits. Pls. Br. at 16; PCC Br. at 8.

The final benefits at issue are travel and home leave vacation benefits. An employee hired from within Panama is eligible if he or she was employed on September 30, 1979 and was a citizen as of that date. An employee recruited from outside of Panama is eligible regardless of date of employment or citizenship. PCC Cross-Motion (R. 13), Ex. 67. The date-of-citizenship requirement disqualifies all but one of the plaintiffs. Compl. pp 4-16. ³

Between June 2, 1995 and July 3, 1996, the plaintiffs filed formal complaints with the PCC's Office of Equal Opportunity alleging that their exclusion from these salary and benefit programs constituted race and national origin discrimination. Pls. Br. at 3. The PCC accepted most of the claims for investigation. ⁴ After completing the investigation, however, it dismissed the claims as untimely, ruling that plaintiffs should have filed years earlier when the benefit policies were first applied to them.

In December 1996, the plaintiffs brought an action in district court, alleging that the denial of the three benefit packages constituted intentional disparate treatment, and had an unlawful disparate impact, in violation of 42 U.S.C. § 2000e-2. ⁵ Plaintiffs relied on statistical evidence, as well as on an attack on the rationales offered by the PCC for denying them the benefits. They contended that the date-ofcitizenship requirements were mere pretext, guaranteeing continued benefits to white non-Panamanians while denying them to black Panamanian employees, the vast majority of whom did not become citizens until after the cut-off dates. ⁶ They also proffered evidence of what they contended was the Panama Canal's "longstanding history of discriminating against employees from the West Indies in every aspect of Canal life and employment," symbolized, they said, by a racially-based payroll system in which white Canal workers were paid in gold from a "gold roll," while black Panamanians were paid in less-valuable Panamanian silver. Pls. Br. at 21. "[P]ayment of the tropical differential to some employees and not others," they contended, reflected nothing more than "a continuation of the 'gold' and 'silver' roll wage differentials which were based on race." Id. at 35.

The district court granted summary judgment in favor of the Commission and dismissed the case. The court rejected plaintiffs' disparate treatment claim, concluding they were denied benefits because of their "citizenship, not because of membership in a Title VII protected class." Anderson v. Zubieta, 977 F.Supp. 439, 441-42 (D.D.C.1997). The court denied the disparate impact claim on the ground that, although disparate impact "may be true as a matter of fact," there was "no evidence that the Defendant acted with any unlawful discriminatory purpose." Id. at 442. This appeal followed.

II

As an initial matter, we must decide whether plaintiffs timely filed their claims with the PCC's Office of Equal Opportunity. Regulations issued by the Equal Employment Opportunity Commission (EEOC) require federal employees to bring Title VII complaints to the attention of an Equal Employment Opportunity counselor within 45 calendar days of the alleged discriminatory event. See 29 C.F.R. § 1614.105(a)(1). A plaintiff's administrative complaint is untimely unless it is brought within the 45-day limitations period, or unless the plaintiff establishes a basis for equitable tolling. See id. § 1614.107(b).

After investigating plaintiffs' complaints, the PCC rejected them as untimely. The Canal Commission had amended the benefit policies in question in 1976, 1979, and 1989. The plaintiffs, all of whom became citizens between 1977 and 1994, received notice that they were not entitled to the benefits on various dates ranging from July 13, 1977 to July 7, 1994. See PCC Stmt. of Material Facts (R. 16). None brought a complaint within 45 days of either the amendments or the notice; the first complaint was not brought until June 2, 1995. On that basis, the PCC concluded plaintiffs' administrative complaints were filed too late.

The plaintiffs respond that their complaints allege continuing violations of Title VII, actionable upon receipt of each paycheck. We agree. As a unanimous Supreme Court said in Bazemore v. Friday, "[e]ach week's paycheck that delivers less to a black than to a similarly situated white is a wrong actionable under Title VII, regardless of the fact that this pattern was begun prior" to the limitations period. 478 U.S. 385, 395, 106 S.Ct. 3000, 92 L.Ed.2d 315 (1986) (Brennan, J., concurring, joined by all other Members of the Court). The Courts of Appeals have repeatedly reached the same conclusion. ⁷

The Canal Commission...