Graczyk v. United Steelworkers of America
| Decision Date | 17 May 1985 |
| Docket Number | 83-3044,Nos. 83-2968,s. 83-2968 |
| Citation | 763 F.2d 256 |
| Parties | 37 Fair Empl.Prac.Cas. 1456, 37 Empl. Prac. Dec. P 35,271 Anthony J. GRACZYK, Plaintiff-Appellant, v. UNITED STEELWORKERS OF AMERICA, Defendant-Appellee. John HOWARD, Peter Calacci, and Harold Picard, Plaintiffs-Appellants, v. UNITED STEELWORKERS OF AMERICA, Defendant-Appellee. |
| Court | U.S. Court of Appeals — Seventh Circuit |
Lawrence Jay Weiner, Weiner, Neuman & Spak, Chicago, Ill., for plaintiffs-appellants.
Richard Brean, United Steelworkers of America, Pittsburgh, Pa., for defendant-appellee.
Before ESCHBACH, COFFEY and FLAUM, Circuit Judges.
The primary question presented by these consolidated appeals is whether the district court erred in concluding that the 1977 collective-bargaining agreement at issue was "in effect" on September 1, 1977, for the purposes of Sec. 2(b) of P.L. No. 95-256, which amended the Age Discrimination in Employment Act of 1967, 29 U.S.C. Secs. 621-634 ("ADEA"), and, therefore, that the agreement was exempted from the application of those amendments at the time of appellants' retirement. For the reasons developed below, we have determined that the district court's interpretation of both Sec. 2(b) and the 1977 labor agreement was correct.
The United Steelworkers of America ("USWA") is a labor organization that represents workers in the steel and related industries. During the period under consideration, the union employed approximately 800 individuals as "staff representatives," who would act as agents of the International for the over 5,000 local unions. The USWA staff representatives themselves were represented by a labor organization, the Staffman's Organizing Committee ("SOC").
Appellant Graczyk was employed as a staff representative by the USWA from July 1943 to October 1, 1979. The terms and conditions of his employment were determined by collective-bargaining agreements negotiated and signed between the SOC and the USWA. The six agreements--in 1966, 1968, 1970, 1971, 1974, and 1977--under which Graczyk was employed provided for mandatory retirement at age 65. 1
On May 9, 1977, the SOC notified the USWA that the SOC wished to terminate the agreement dated August 1, 1974. Article XI of the 1974 agreement provided that the contract would continue in effect until such time as the [USWA] has completed negotiations and reached new agreements with the aluminum industry, nonferrous and basic steel industry, in 1977. Not later than 30 days thereafter, the parties will make arrangements to meet and negotiate a new Agreement. This Agremeent shall continue in effect until either party notifies the other of its desire to terminate, or a new Agreement is reached by the parties. It is further understood that the effective date of any Agreement reached by the parties subsequent to July 31, 1977, shall be effective August 1, 1977, unless otherwise mutually agreed.
(emphasis in original)
The negotiations between the USWA and the SOC began in July 1977, and were completed on or about October 12, 1977; the new contract was formally signed on November 1, 1977, and provided that:
This Agreement, dated as of August 1, 1977, is between the [USWA] and the [SOC]. Except as otherwise specified herein, the provisions of this Agreement shall be effective August 1, 1977. This Agreement supersedes and replaces the Agreement between the parties dated August 1, 1974.
When the 1977 agreement was signed, the mandatory retirement policy was consistent with the requirements of the ADEA. In United Air Lines, Inc. v. McMann, 434 U.S. 192, 98 S.Ct. 444 (1977), the Supreme Court held that early retirement of an employee pursuant to a mandatory retirement provision of a bona-fide retirement plan was not prohibited by the ADEA. However, on April 6, 1978, Congress overruled McMann by enacting P.L. No. 95-256, 92 Stat. 189 ("1978 amendments"), which amended ADEA Sec. 12, 29 U.S.C. Sec. 631, to provide protection for individuals "who are at least 40 years of age but less than 70 years of age." This amendment to Sec. 12 became effective on January 1, 1979. In addition, Sec. 4(f)(2), 29 U.S.C. Sec. 623(f)(2), of the Act was amended to provide that no "seniority system or employee benefit plan shall require or permit the involuntary retirement of any individual specified by [29 U.S.C. Sec. 631(a) ] because of the age of such individual." 2
Section 2(b) of P.L. No. 95-256 set out the effective date of the amendment to Sec. 4(f)(2) of the Act:
The amendment [to 29 U.S.C. Sec. 623(f)(2) ] shall take effect on [April 6, 1978], except that, in the case of employees covered by a collective bargaining agreement which is in effect on September 1, 1977, which was entered into by a labor organization ..., and which would otherwise be prohibited by [29 U.S.C. Sec. 631], the amendment [to 29 U.S.C. Sec. 623(f)(2) ] shall take effect upon the termination of such agreement or on January 1, 1980, whichever occurs first.
The USWA sought an opinion from the Department of Labor ("DOL") 3 as to the effect of the 1978 amendments. On July 21, 1978, representatives of the USWA met with certain DOL officials, including Donald Elisburg, the DOL's Assistant Secretary for Employment Standards. At the meeting, the DOL representatives provided an oral opinion that the USWA's 1977 collective-bargaining agreement was "in effect" on September 1, 1977, for the purposes of Sec. 2(b) of the 1978 amendments. This conclusion was not memorialized in any document. Assistant Secretary Elisburg did, however, in responding to a request from Leroy D. Clark, General Counsel of the EEOC, provide in a letter dated October 20, 1980, an account of the July 1978 meeting:
To the best of my recollection we were unanimous in stating that such an agreement would be considered by us to be "in effect on September 1, 1977" if the purpose of the retroactivity was not a subterfuge to get around the purposes of the Act and to avoid application of the ADEA amendments as of January 1, 1979. As we were informed by the [USWA's] counsel that such retroactivity was completely consistent with past practice, that the retroactivity feature of the 1977 contract was agreed to by the parties in 1974, and that the retroactivity became effective when the current 1977 agreement was signed, which was well before the adoption of the ADEA amendments, it seemed clear to us that the retroactivity was not a bad faith effort by the [USWA] to get around the new age 70 mandatory retirement age.
(emphasis in original)
On July 5, 1979, Graczyk was informed by the USWA that, because he would reach 65 years of age on September 5, 1979, he would be required to retire no later than October 1, 1979, pursuant to the compulsory retirement plan. Graczyk filed a grievance on July 20, 1979, contesting the involuntary retirement and subsequently exhausted the administrative procedures and remedies provided by the USWA. On October 1, 1979, he was retired.
Graczyk then filed a charge with the EEOC on December 12, 1979, in which he maintained that the USWA's termination of his employment violated his rights under the 1978 amendments. The EEOC at first authorized the initiation of a lawsuit by that agency against the USWA for a violation of the ADEA. This position was consistent with that taken by the EEOC in its interpretation of the 1978 amendments:
Where a collective bargaining agreement expired prior to September 1, 1977, and a new agreement was signed subsequent to that date effective retroactively to the expiration date of the previous agreement, the exemption [of Sec. 2(b) ] does not apply. The expressed congressional intent was to exempt only those agreements which had been "negotiated" before September 1, 1977.
It should be noted that this regulation was not even proposed until November 1979 (after all four plaintiffs had been retired), and was not officially adopted until September 29, 1981 (1428 days after the 1977 agreement was formally signed and 637 days after January 1, 1980, which was the date that the Sec. 2(b) exemption expired). 4
The decision to proceed with litigation was made before the EEOC was informed of the July 1978 meeting between representatives of the DOL and the USWA. When apprised of the meeting, the EEOC determined that a suit by the government would be inappropriate and, therefore, withdrew authorization for the General Counsel to sue. Graczyk instituted this action on June 9, 1980.
Three other USWA staff representatives who were forced to retire in 1979 when they reached age 65--Peter Calacci, John Howard, and Harold Picard ("additional plaintiffs")--sought to join the action instituted by Graczyk. It is undisputed that the additional plaintiffs never filed timely age-discrimination charges with the EEOC relating to their retirement. On June 15, 1981, the trial court granted Graczyk leave under Fed.R.Civ.P. 21 to add the additional plaintiffs to the action. On June 19, 1981, the USWA filed a "Motion to Reconsider Granting of Plaintiff's Motion to Add Additional Plaintiffs or, in the Alternative, to Dismiss Claims of Additional Plaintiffs." The additional plaintiffs' consents were filed on July 6, 1981. Pursuant to a motion from the USWA, the court entered an order on August 13, 1981, that no new parties could be added after August 21.
On January 28, 1983, the trial court denied the USWA's motion for reconsideration and held over the motion to dismiss. At that time, the court, after being informed that no amended complaint had been filed since the order of June 15, 1981, directed Graczyk to file an amended complaint by February 4, 1983, that would include the names and allegations of the additional plaintiffs. This amendment was apparently requested because discovery had revealed certain factual distinctions in the individual claims of the additional plaint...
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