Jensen v. Gulf Oil Refining and Marketing Co.

• Decision Date: 08 August 1980
• Docket Number: No. 79-1572,79-1572
• Parties: 23 Fair Empl.Prac.Cas. 790, 23 Empl. Prac. Dec. P 31,157 Hans JENSEN, Plaintiff-Appellant, v. GULF OIL REFINING AND MARKETING COMPANY and Gulf Oil Corporation, Defendants-Appellees.
• Court: U.S. Court of Appeals — Fifth Circuit

Page 406

623 F.2d 406

23 Fair Empl.Prac.Cas. 790,

23 Empl. Prac. Dec. P 31,157

Hans JENSEN, Plaintiff-Appellant, v. GULF OIL REFINING AND MARKETING COMPANY and Gulf Oil Corporation, Defendants-Appellees.

No. 79-1572.

United States Court of Appeals Fifth Circuit.

Aug. 8, 1980.

James E. Robinson, Houston, Tex., for plaintiff-appellant.

William G. Duck, The Gulf Companies, Law Dept., Houston, Tex., for defendants-appellees.

Marcia B. Ruskin, App. Div., EEOC, Washington, D. C., amicus curiae, for Equal Employment Opportunity.

Appeal from the United States District Court for the Southern District of Texas.

Before VANCE, POLITZ and RANDALL, Circuit Judges.

RANDALL, Circuit Judge:

I. FACTS

Plaintiff-Appellant Hans Jensen brought suit against his former employer, Gulf Oil Corporation and Gulf Oil Refining and Marketing Company, a division of Gulf Oil Corporation (Gulf), alleging that Gulf violated the Age Discrimination in Employment Act of 1967 (ADEA), 29 U.S.C. §§ 621-34 (1976) by forcing him to retire because of his age. From a summary judgment entered in Gulf's favor, Jensen appeals. ¹

Appellant, a Gulf employee for twenty-nine years, was involuntarily retired on January 31, 1977, at the age of fifty-one, pursuant to the terms of an employee benefit plan that has been in effect at Gulf continuously since 1944. Under that plan, the normal retirement age is sixty-five, but after an employee has accumulated seventy-five points, computed on the basis of age plus years of service with Gulf, he can be retired at any time either upon his own request or upon application of any of the Gulf companies.

The purpose of the ADEA is stated as follows:

to promote employment of older persons based on their ability rather than age; to prohibit arbitrary age discrimination in employment; to help employers and workers find ways of meeting problems arising from the impact of age on employment.

29 U.S.C. § 621(b) (1976). Under the ADEA it is unlawful for an employer:

to fail or refuse to hire or to discharge any individual or otherwise discriminate against any individual with respect to his compensation, terms, conditions, or privileges of employment, because of such individual's age . . . .

Id. at § 623(a)(1).

At the time of Jensen's retirement, § 623(f)(2) of the ADEA contained the following language permitting some involuntary retirements prior to age sixty-five:

(f) It shall not be unlawful for an employer, employment agency, or labor organization

(2) to observe the terms of a bona fide seniority system or any bona fide employee benefit plan such as a retirement, pension, or insurance plan, which is not a subterfuge to evade the purposes of this chapter, except that no such employee benefit plan shall excuse the failure to hire any individual . . . .

Id. at § 623(f)(2) (amended 1978). ² In 1978, that subsection was amended to provide as follows:

(f) It shall not be unlawful for an employer, employment agency, or labor organization

(2) to observe the terms of a bona fide seniority system or any bona fide employee benefit plan such as a retirement, pension, or insurance plan, which is not a subterfuge to evade the purposes of this chapter, except that no such employee benefit plan shall excuse the failure to hire any individual, and no such seniority system or employee benefit plan shall require or permit the involuntary retirement of any individual specified by section 631(a) of this title because of the age of such individual . . . .

Id. at § 623(f)(2) (Supp. II 1978). Congress provided that the amendment "shall take effect on the date of enactment of this Act (April 6, 1978)." Pub.L.No.95-256 § 2(b), 92 Stat. 189.

II. ISSUES

Jensen does not contend that there are any genuine issues of material fact, so we must determine only whether Gulf is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(c). The first issue presented this appeal is the retroactive application of the 1978 amendment to § 623(f)(2). If that amendment governs in this case, Gulf's action was concededly unlawful. If the amendment does not apply retroactively, the question remains whether Gulf's action was unlawful under the unamended version of § 623(f)(2) in effect at the time of Jensen's retirement. Answering both questions in the negative, we affirm the judgment of the district court.

III. RETROACTIVITY OF AMENDMENT TO § 623(f)(2)

Since the amendment of the ADEA in 1978, several courts have had occasion to consider whether amendment to § 623(f)(2) should be applied to involuntary retirements occurring before April 6, 1978, the date of enactment of the Act amending the ADEA. See, e. g., Sikora v. American Can Co., 22 FEP 638 (3d Cir. 1980); Marshall v. Delaware River & Bay Authority, 471 F.Supp. 886 (D.Del.1979); Marshall v. Baltimore & Ohio Railroad Co., 461 F.Supp. 362 (D.Md.1978); Marshall v. Atlantic Container Line, 18 FEP 1167 (S.D.N.Y.1978); Davis v. Boy Scouts of America, 457 F.Supp. 665 (D.N.J.1978). Of those cases, we are aware of only one holding that the amendment to § 623(f)(2) should be applied to an involuntary retirement occurring before the ADEA was amended, Davis, 457 F.Supp. 665. ³ Cf. Wagner v. Sperry Univac, Division of Sperry Rand Corp., 458 F.Supp. 505, 511 n.3 (E.D.Pa.1978) (1978 amendments to 29 U.S.C. § 626(d), lowering some procedural hurdles with which plaintiffs must comply under the ADEA, said to be applicable only to actions brought after April 6, 1978).

Applying the principle set forth in United States v. Schooner Peggy, 5 U.S. 103 (1 Cranch), 2 L.Ed. 49 (1801), ⁴ and elaborated upon in Bradley v. Richmond School Board, 416 U.S. 696, 94 S.Ct. 2006, 40 L.Ed.2d 476 (1974), that "a court is to apply the law in effect at the time it renders its decision, unless doing so would result in manifest injustice or there is statutory direction or legislative history to the contrary," Bradley, 416 U.S. at 711, 94 S.Ct. at 2016, we conclude that the amended version of § 623(f)(2) does not apply to retirements occurring before the date the amendment was enacted.

A. Statute and Legislative History

Turning first to the statute, we do not find the statement that the amendment prohibiting involuntary retirement before age sixty-five shall take effect upon enactment dispositive. ⁵

Turning next to the legislative history, Appellant stresses that one of the purposes of the amendment was to clarify Congress' original intent. See, e. g., H.R.Conf.Rep.No. 950, 95th Cong. 2d Sess. 7-8, reprinted in (1978) U.S.Code Cong. & Admin.News, pp. 504, 528-29. In order to reach the result that involuntary retirement before age sixty-five would not be excused by § 623(f) (2) as worded when enacted in 1967, unless the reasons for the retirement were other than age, clarification was needed since courts construing that section had held to the contrary. See Zinger v. Blanchette, 549 F.2d 901 (3d Cir. 1977), cert. denied, 434 U.S. 1008, 98 S.Ct. 717, 54 L.Ed.2d 750 (1978); Brennan v. Taft Broadcasting Co., 500 F.2d 212 (5th Cir. 1974). The Fourth Circuit, however, had held that a pre-age-sixty-five involuntary retirement under a retirement plan, meeting the Brennan tests (requiring that it exist and pay substantial benefits in order to be bona fide and that it predate the enactment of the ADEA in order not to be a subterfuge), is nevertheless proscribed by the ADEA unless the employer can demonstrate that the early retirement provision "ha(s) some economic or business purpose other than arbitrary age discrimination." ⁶ McMann v. United Air Lines, Inc., 542 F.2d 217, 221 (4th Cir. 1976), rev'd, 434 U.S. 192, 98 S.Ct. 444, 54 L.Ed.2d 402 (1977). The Supreme Court reversed that decision during the pendency of the 1978 amendments to the ADEA and held that no such purpose was required to justify bona fide pre-existing plans in order to satisfy the subterfuge language of § 623(f)(2). United Air Lines, Inc. v. McMann, 434 U.S. 192, 98 S.Ct. 444, 54 L.Ed.2d 402 (1977). Justice Marshall, dissenting in that case was of the opinion that the Committee reports concerning the 1978 amendments "make plain that, properly understood, the existing Act already prohibits involuntary retirement, and that the amendment is only a clarification necessitated by court decisions misconstruing congressional intent. H.R.Rep.No. 95-527, pp. 5-6 (1977); id., at 27 (additional views of Rep. Weiss, quoting statement of Sen. Javits); S.Rep.No. 95-493, pp. 9-10 (1977)." Id. at 218, 98 S.Ct. at 458. (Marshall, J., dissenting). In response to this argument, however, the majority noted that "(l)egislative observations 10 years after passage of the Act are in no sense part of the legislative history." Id. at 200 n.7, 98 S.Ct. at 449 n. 7. See also Oscar Mayer & Co. v. Evans, 441 U.S. 750, 758, 99 S.Ct. 2066, 2072-2073, 60 L.Ed.2d 609 (1979) (quoting McMann ); Rogers v. Frito-Lay, Inc., 611 F.2d 1074, 1080 (5th Cir. 1980) ("What happened after a statute was enacted may be history and it may come from members of the Congress, but it is not part of the legislative history of the original enactment."); Holliday v. Ketchum, MacLeod & Grove, Inc., 584 F.2d 1221, 1229 (3d Cir. 1978) ("Certainly the intent of the 1978 amenders of the ADEA cannot be said to represent or reflect the intent of the 1967 Congress: there is no necessary relation back.") (footnote omitted).

Furthermore, the clearest statement in the legislative history on the question of retroactivity of the amendment supports the view that it should not be applied retroactively. During Senate debates the following exchange occurred:

Mr. Randolph: I should like to ask the Senator from New Jersey (Mr. Williams) whether this bill retroactively covers a forced retirement at, say, age 60 or 62 prior to the effective date of this bill where the individual so retired is eligible for, and actually receives, a pension under a pension plan which has been qualified with the Internal Revenue Service?

Mr. Williams: The bill is not...