Davis v. Alabama Power Company

Decision Date11 September 1974
Docket NumberCiv. A. No. 72-G-1123-S.
Citation383 F. Supp. 880
PartiesRaymond E. DAVIS, Plaintiff, v. ALABAMA POWER COMPANY, Defendant.
CourtU.S. District Court — Northern District of Alabama


Wayman G. Sherrer, U. S. Atty., Henry I. Frohsin, Asst. U. S. Atty., Birmingham, Ala., for plaintiff.

H. Hampton Boles, Balch, Bingham, Baker, Hawthorne, Williams & Ward, Birmingham, Ala., for defendant.


GUIN, District Judge.

The plaintiff, Raymond E. Davis, in this non-jury proceeding, is a World War II armed forces veteran who temporarily left his employment with the defendant, Alabama Power Company, to serve his country during war time. This plaintiff asserts, pursuant to the Military Selective Service Act,1 that the period of time spent in the service of his country should be held, by this court, to be "accredited service" for purposes of computing retirement pension benefits under the defendant's retirement program.

The defendant, Alabama Power Company, on the other hand, ardently maintains that: (1) because the company's pension policy denies all other employees, who were on furlough or leave of absence without regular pay, the right to accredited service, that it would be contrary to the company's overall policy to bestow accredited service to those called to serve their country where no actual work had been done for the company during such period of service; (2) it would be unconstitutional to require the defendant to grant the plaintiff increased retirement income based upon a period of time in which the plaintiff performed no work; (3) the plaintiff's claim for relief is barred by the one-year Alabama statute of limitations, Ala.Code (Recomp.1958), tit. 7, § 26, or by the six-year Alabama statute of limitations, Ala.Code (Recomp.1958), tit. 7, § 21, or by the equitable doctrine of laches.


The pertinent facts, which were stipulated by the parties and the uncontradicted testimony of the one witness, are as follows:

The plaintiff commenced his employment with the defendant on August 16, 1937; after having worked for the defendant for a period of seven years, the plaintiff, on March 18, 1943, temporarily left that employment to serve the cause of his country in the military. The plaintiff honorably served our nation and was discharged on October 1, 1945. On October 8, 1945, the plaintiff was reinstated with the defendant and continued that employment until he retired on June 1, 1971. Thus, the time period involved in this suit is the two-year, six-month and 20-day period in which this World War II veteran plaintiff temporarily left the employment of the defendant to serve in the defense of his country. The plaintiff is presently receiving $198.95 per month under the defendant's retirement pension program; however, if this court determines that the Military Selective Service Act, 50 U.S.C.App. § 459, entitles the plaintiff to receive "accredited service" for his time in the service, plaintiff will be entitled to $216.06 per month; an increase per month of $17.11. If the plaintiff's seniority status is so determined, he will be entitled to an appropriate award to compensate him for the loss of this amount from past pension payments, and to a mandatory injunction requiring the defendant to increase his present pension payment from $198.85 per month to $216.06 per month, as to all future installments on his pension.

The defendant established its pension program for its employees on July 1, 1944, and the plan has been amended from time to time pursuant to negotiations between the defendant and the various local unions of the International Brotherhood of Electrical Workers since 1950, including Local No. 841 of which the plaintiff was a member at the time of his retirement. The pension plan has been a part of collective bargaining agreements between the defendant and the various local unions of the International Brotherhood of Electrical Workers since July, 1961, including Local No. 841.

The pension plan provides that all full-time regular employees of the defendant who have completed one year of service with the defendant and have attained the age of 25 years are included in the pension plan. Employees other than full-time regular employees, such as part-time employees and emergency employees, are not included in the pension plan and are not eligible to accrue "accredited service." According to directives and practices of the defendant, a full-time regular employee of the defendant is an employee who is employed on a full-time basis for an indefinite period of time. A full-time regular work week of the defendant consists of 40 hours per week, and regular daily work consists of eight scheduled hours work per day. Furthermore, under the defendant's pension plan, in the computing of "accredited time" the pension plan makes immaterial the number of overtime hours or overtime days the employee may have worked during his career, as none of this actual work time is taken into account in computing "accredited service." "Accredited service" does include, pursuant to collective bargaining agreements and employment practices and policies of the defendant, the following:

(1) From two weeks to five weeks annual vacation, the length of such vacation depending upon the length of the employee's service;
(2) Eight holidays per year;
(3) Annual sick leave up to 10 work days per year, or accumulation of a maximum of 30 work days;
(4) Up to three work days as a result of death in the immediate family of an employee; and
(5) Up to a maximum of nine months extended sick leave with pay, or up to 12 months by reducing the pay per month to the equivalent of six months at full pay and six months at half pay. (Such extended sick leave is discretionary with defendant and is pro-rated downward for employees with less than 20 years of service with defendant.)2

With respect to the exclusion of military service by the defendant from its pension plan, except as provided by the amendment of January 1, 1966 (which is not applicable to the plaintiff) the defendant has excluded all periods of leave of absence without regular pay and periods of military service in the computation of "accredited service" for the purpose of the pension plan.3

The plaintiff's status and benefits under the defendant's pension plan were reviewed with the plaintiff by the defendant on September 11, 1967, at which time the plaintiff was advised by the defendant that it would not include as a part of its computation of pension benefits the period of time he spent in the military service as "accredited service." The method of computation used to determine the plaintiff's retirement benefits is found in Section V.4(a) and (b) of the pension plan. This method is the so-called "minimum Retirement Income" method which takes into account two operating factors: (1) the employee's rate of earnings as of his retirement date; and (2) his years of "accredited service."

The amount of contributions to the pension plan trust fund is determined by the defendant or its agents annually on an actuarial basis, taking into account the factors which include: (1) the number of full-time regular employees who are covered by the plan; (2) their accredited service; and (3) their earnings. Further, the defendant maintains that the pension plan trust fund was not funded to pay retirement income based upon the inclusion of military service as accredited service other than as provided by Section III of the plan.4


The legal issue before the court is simply whether 50 U.S.C.App. § 459(b) and (c) require this defendant employer to include the plaintiff's time spent in the military service in its computation of benefits under the defendant's retirement pension plan. More basically, this court must determine whether the retirement benefits under the defendant's pension plan were perquisites of "seniority" or merely in the nature of "other benefits" under Section 9(c)(1) 50 U. S.C.App. § 459(c)(1) of the act.5 If the rights of the plaintiff, under the defendant's pension plan, are seniority rights, it is clear that the time he spent in the service of his country must be included in the computation of the amount of his pension payments. 50 U.S.C.App. § 459(b) and (c);6 Accardi v. Pennsylvania R. Co., 383 U.S. 225, 86 S.Ct. 768, 15 L.Ed.2d 717 (1966).

The defendant, Alabama Power, contends that its pension plan is not a seniority benefit but rather a retirement program based on the amount of work actually performed for the company, and thus is an "other benefit" which is not subject to the Military Selective Service Act. The finding of this court thus rests upon whether or not this pension plan is based upon the actual amount of work performed for the defendant company, or whether this pension plan is simply a perquisite of "seniority."


This court takes note that because the act does not define the term "seniority," veterans have had to turn to the courts for a definition of seniority rights.7 The courts have had to proceed, case by case, to delineate the concept of "seniority" within the spirit of the act, without a rigid classification of seniority rights by collective bargaining agreements or employer interpretation of what seniority rights should or should not consist of.

While collective bargaining contracts have been consulted by the Supreme Court, the rule devised by the Supreme Court in interpreting individual contracts once a benefit has been determined to be a perquisite of seniority has always been:

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. Fishgold v. Sullivan Drydock & Repair Corp., 328 U.S. 275 at 285, 66 S. Ct. 1105

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