International Union, United Auto., Aerospace and Agr. Implement Workers of America v. Brock

• Decision Date: 24 April 1987
• Docket Number: No. 83-2026,83-2026
• Citation: 816 F.2d 761,259 U.S.App.D.C. 457
• Parties: , 259 U.S.App.D.C. 457, 55 USLW 2610, 106 Lab.Cas. P 12,400 INTERNATIONAL UNION, UNITED AUTOMOBILE, AEROSPACE AND AGRICULTURAL IMPLEMENT WORKERS OF AMERICA, et al. v. William BROCK, Secretary of the United States Department of Labor, Appellant.
• Court: U.S. Court of Appeals — District of Columbia Circuit

Page 761

816 F.2d 761

8 ITRD 2169, 259 U.S.App.D.C. 457, 55

USLW 2610,

106 Lab.Cas. P 12,400

INTERNATIONAL UNION, UNITED AUTOMOBILE, AEROSPACE AND AGRICULTURAL IMPLEMENT WORKERS OF AMERICA, et al. v. William BROCK, Secretary of the United States Department of

Labor, Appellant.

No. 83-2026.

United States Court of Appeals, District of Columbia Circuit.

Argued Feb. 6, 1987.

Decided April 24, 1987.

Appeal from the United States District Court for the District of Columbia (Civil Action No. 81-01954).

William G. Cole, Atty., Dept. of Justice, with whom Richard K. Willard, Asst. Atty. Gen., Dept. of Justice, Joseph E. diGenova, U.S. Atty., and Leonard Schaitman, Atty., Dept. of Justice, Washington, D.C., were on the brief, for appellant. Michael F. Hertz, Atty., Dept. of Justice, Washington, D.C., also entered an appearance for appellant.

Marsha S. Berzon, San Francisco, Cal., with whom Jordan Rossen, Leonard Page, Detroit, Mich., Stephen P. Berzon, George Harris and Gay C. Danforth, San Francisco, Cal., were on the brief, for appellees. Michael Rubin, San Francisco, Cal., Wendy Kahn and Abraham L. Zwerdling, Washington, D.C., also entered appearances for appellees.

Before MIKVA and EDWARDS, Circuit Judges, and WRIGHT, Senior Circuit Judge.

Opinion for the court filed by Circuit Judge HARRY T. EDWARDS.

HARRY T. EDWARDS, Circuit Judge:

In 1981, the International Union, United Automobile, Aerospace & Agricultural Implement Workers of America ("UAW") and eleven named plaintiffs filed suit in the District Court challenging worker eligibility guidelines promulgated by the Secretary of Labor for the Trade Readjustment Allowance ("TRA") program of the Trade Act of 1974 (the "Act" or "Trade Act"). 19 U.S.C. Sec. 2101 et seq. (1976 ed.). The District Court found that the guidelines conflicted with section 231 of the Trade Act and with the Vietnam Era Veterans' Readjustment Act of 1972 (Veterans' Act of 1972), 38 U.S.C. Sec. 2011 et seq. (1982). The trial court ordered the Secretary to modify his over-restrictive interpretation of the Trade Act; to eliminate the conflict with the Veterans' Act of 1972; and to direct cooperating state agencies to take specific steps to correct past and present errors in the administration of the program. UAW v. Donovan, 568 F.Supp. 1047, 1058-59 (D.D.C.1983).

On appeal, this court found that the UAW lacked standing to bring this action, and that the claims of the individual named plaintiffs should be dismissed for failure to join cooperating state agencies, UAW v. Donovan, 746 F.2d 839, 842, 843-44 (D.C.Cir.1984); the Supreme Court, in turn, reversed and remanded for further proceedings. UAW v. Brock, --- U.S. ----, ----, 106 S.Ct. 2523, 2533-34, 91 L.Ed.2d 228 (1986).

Years of procedural wrangling finally at an end, we turn to the substance of appellees' claims. We affirm the District Court's reading of the Trade Act, reverse its holding that the Secretary's guidelines conflict with the Veterans' Act of 1972, and modify its remedial order.

I. BACKGROUND

The Trade Act of 1974, 19 U.S.C. Sec. 2101 et seq. (1976 ed.), establishes a program of "trade readjustment allowances" to assist American workers who have lost their jobs to competition from abroad. Id. Secs. 2291-95. The 1974 Act endeavored to correct the shortcomings of a similar program that had been enacted in the Trade Expansion Act of 1962. See S.REP. No. 93-1298, 93d Cong., 2d Sess. 131 (1974), U.S.Code Cong. & Admin.News 1974, pp. 7186, 7273. The new program contained "eased qualifying criteria and a streamlined petitioning process," designed to ensure that displaced workers actually received the benefits to which they were entitled. Id.

Before a displaced worker may receive TRA benefits under the 1974 Act, two hurdles must be cleared. The Secretary of Labor must first certify that the worker's firm has been adversely affected by foreign competition. 19 U.S.C. Secs. 2271-73. After certification, employees of the firm who have lost their jobs to competition may apply for TRA benefits under the eligibility guidelines set out in the Act and in regulations promulgated by the Department of Labor. Id. Sec. 2291; 29 C.F.R. Sec. 91.6 (1976 ed.). Cooperating state agencies serve as "agents" of the United States in processing applications, determining whether individuals satisfy eligibility requirements and disbursing readjustment allowances. 19 U.S.C. Sec. 2311(a) & (d) (1976 ed.).

Section 231 of the Trade Act sets out the principal worker eligibility requirements for the program. To qualify for TRA benefits a worker must have "had, in the 52 weeks immediately preceding ... separation, at least 26 weeks of employment at wages of $30 or more a week in adversely affected employment with a single firm or subdivision of a firm." 19 U.S.C. Sec. 2291(2). In a 1975 policy handbook distributed to cooperating state agencies, the Secretary interpreted the term "employment" in section 231 to exclude

[p]eriods in which service is not being performed, such as leave of absence, sick or annual leave or vacation leave, and periods in which service is being performed for other than the adversely affected employer, such as military service, temporary loan or detail to another employer, or work for another employer while attached to the adversely affected employer....

Department of Labor Manpower Administration Handbook No. 315, ch. 1, p 9 (July 1975) ("Handbook"). On August 20, 1981, plaintiffs filed suit challenging this interpretation on grounds of inconsistency with section 231 of the Trade Act and with the Veterans' Acts of 1972 and 1974. ¹

The District Court, relying on the fact that the Secretary had threatened to cut off funding to state agencies that failed to follow the Handbook interpretation, concluded that the Secretary's interpretation had a sufficiently conclusive effect on state administration of the TRA program to make the issue justiciable. 568 F.Supp. at 1051. The court went on to find that the Secretary's interpretation, which excluded paid time-off from the definition of employment, conflicted with the congressional purpose underlying section 231 of the Trade Act. Id. at 1055-56. The District Court also found that, to the extent that the Handbook requires the state agencies to include weeks of military service in the 52-week "qualifying period," the Secretary's interpretation conflicted with section 2013 of the Veterans' Act of 1972, which requires periods of military service to be disregarded for employment rights purposes. Id. at 1057; 38 U.S.C. Sec. 2013 (1982). The court found no conflict, however, between the Handbook interpretation and the Veterans' Reemployment Rights Act of 1974. 568 F.Supp. at 1056-57. ²

The Secretary appealed the judgment of the District Court. A divided panel of this court found that the UAW lacked standing to bring the action, and that the action brought by the individual named plaintiffs should be dismissed for failure to join the cooperating state agencies. UAW v. Donovan, 746 F.2d 839, 843-44 (1984). The Supreme Court reversed, finding that the UAW has standing to sue on behalf of its members under settled principles of associational standing, and that the state agencies are not necessary and indispensable parties to an action that directly challenges the Secretary's interpretation of the Trade Act. UAW v. Brock, --- U.S. ----, ----, 106 S.Ct. 2523, 2533-34, 91 L.Ed.2d 228 (1986). In light of this decision and the specific instructions of the Supreme Court, --- U.S. ---- - ---, 106 S.Ct. at 2534-35, ³ we now examine the merits of the District Court's opinion.

II. SECTION 231 OF THE TRADE ACT

The principal dispute before the District Court concerned the UAW's challenge to the Secretary's interpretation of the term "employment" in section 231 of the Trade Act of 1974. Because the Act itself does not define "employment," the District Court decided that the "ordinary meaning" of the term should control, 568 F.Supp. at 1052, relying on American Tobacco Co. v. Patterson, 456 U.S. 63, 68, 102 S.Ct. 1534, 1537, 71 L.Ed.2d 748 (1982), and found that the term "employment" ordinarily includes weeks of paid vacation or sick leave. ⁴ The trial court thus had little trouble in concluding that the Secretary's interpretation is clearly at odds with the ordinary meaning of "employment."

In arriving at the proper construction of section 231, we must first determine what weight, if any, to give to the Secretary's interpretation. It is sometimes said that the "construction of a statute by those charged with its execution should be followed unless there are compelling indications that it is wrong...." Red Lion Broadcasting Co. v. FCC, 395 U.S. 367, 381, 89 S.Ct. 1794, 1801, 23 L.Ed.2d 371 (1969) (footnote omitted). However, this principle has been clarified by the Supreme Court in recent years to make it clear that "[t]he judiciary is the final authority on issues of statutory construction and must reject administrative constructions which are contrary to clear congressional intent." Chevron U.S.A. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 843 n. 9, 104 S.Ct. 2778, 2781 n. 9, 81 L.Ed.2d 694 (1984).

The principal charge of a court in statutory construction is to ascertain congressional intent. "If a court, employing traditional tools of statutory construction, ascertains that Congress had an intention on the precise question at issue, that intention is the law and must be given effect." Id. In performing this responsibility, "courts may substitute their interpretation of a statute for that of an agency whenever they face 'a pure question of statutory construction for the courts to decide,' rather than a 'question of interpretation [in which] the agency is required to apply [a legal standard] to a particular set of facts.' " I & NS v. Cardoza-Fonseca, --- U.S. ----, ----, 107 S.Ct. 1207, 1225, 94 L.Ed.2d 434 (1987) (Scalia, J., concurring in the result) (quoting majority op. at 1220-21)....