Russell v. American Tobacco Co.

• Decision Date: 19 April 1976
• Docket Number: AFL--CI,Nos. 74--1650 and 74--1652,A,s. 74--1650 and 74--1652
• Citation: 528 F.2d 357
• Parties: d 357 11 Fair Empl.Prac.Cas. 395, 10 Empl. Prac. Dec. P 10,412 Edgar RUSSELL et al., Appellants, v. The AMERICAN TOBACCO CO., and Local 192, Tobacco Workers International Union, an affiliate,ppellees. United States Equal Employment Opportunity Commission, Amicus Curiae. Edgar RUSSELL et al., Appellees, v. The AMERICAN TOBACCO CO. et al., Appellants.
• Court: U.S. Court of Appeals — Fourth Circuit

Page 357

528 F. 2d 357

11 Fair Empl.Prac.Cas. 395,

10 Empl. Prac. Dec. P 10,412

Edgar RUSSELL et al., Appellants, v. The AMERICAN TOBACCO CO., and Local 192, Tobacco Workers

International Union, an affiliate, AFL--CIO, Appellees.

United States Equal Employment Opportunity Commission,

Amicus Curiae.

Edgar RUSSELL et al., Appellees, v. The AMERICAN TOBACCO CO. et al., Appellants.

Nos. 74--1650 and 74--1652.

United States Court of Appeals, Fourth Circuit.

Argued Jan. 7, 1975.

Decided Sept. 24, 1975.

Certiorari Denied April 19, 1976.

See 96 S.Ct. 1666, 1667.

Robert Belton, Charlotte, N.C., and O. Peter Sherwood, New York City (Jonathan Wallas, J. LeVonne Chambers, Charlotte, N.C., Jack Greenberg, Morris J. Baller, New York City, Chambers, Stein, Ferguson & Lanning, Charlotte, N.C., on brief) for appellants.

Charles T. Hagan, Jr., Greensboro, N.C. (Daniel W. Fouts, Adams, Kleemeier, Hagan, Hannah & Fouts, Greensboro, N.C., on brief), for The American Tobacco Co.

Julius J. Gwyn, Reidsville, N.C. (Gwyn, Gwyn & Morgan, Reidsville, N.C., on brief), for Local 192, Tobacco Workers International Union.

Margaret C. Poles, Alexandria, Va., Atty., Equal Employment Opportunity Commission (William A. Carey, Gen. Counsel, Joseph T. Eddins, Jr., Associate Gen. Counsel, and Beatrice Rosenberg and Charles L. Reischel, Attys., Washington, D.C., on brief), for amicus curiae.

Before WINTER, BUTZNER and FIELD, Circuit Judges.

BUTZNER, Circuit Judge:

These appeals involve only a narrow aspect of a class action in which the district court properly granted black employees broad relief under Title VII of the Civil Rights Act of 1964 against the American Tobacco Company and Local 192 of the Tobacco Workers International Union, AFL--CIO. The district court found that at the company's Reidsville, North Carolina, Branch (Branch), the use of departmental seniority, subjective qualifications, and an excessive probationary period for promotions, transfers, pushbacks, and layoffs had unlawfully excluded black employees in the prefabrication department from working in the fabrication department, where better paying jobs had generally been reserved for white employees. Accordingly, the court ordered that these matters be controlled entirely by plant seniority and by a reduced probationary period. It enjoined the use of screening tests not approved by the Equal Employment Opportunity Commission. It found no discrimination in the appointment of supervisors at Branch.

The district court also found that at the company's Leaf Department (Leaf) in nearby Rockingham County, there had been discrimination in the choice of supervisors. Therefore, it required objective criteria for selecting supervisors and affirmative action in appointing black employees to those positions. The court awarded back pay for some of the employees at Branch and Leaf. Neither the company nor the employees appeal these provisions of the decree.

The district court, 374 F.Supp. 286, ruled that Branch and Leaf are separate operations because they are two miles apart, different work is done at each plant, and it is more efficient for the company to maintain their distinct identities. It concluded that 'there is no justification in law or in fact for merging the two lines of seniority' at Branch and Leaf. The employees have appealed the denial of relief for Leaf employees. They also seek to enlarge the decree's provision for compliance reports. The union has filed a cross-appeal challenging the court's jurisdiction and complaining about the assessment of back pay.

For the reasons stated in Part I, we conclude that qualified black Leaf employees should be permitted to fill permanent vacancies in the fabrication department at Branch without sacrificing their company seniority and that they, like the black employees at Branch, are entitled to back pay. In Part II we affirm the court's order for reports. For the reasons stated in Part III, we find no cause for reversal in the union's cross-appeal. Accordingly, with appropriate modifications to provide a remedy for the employees at Leaf, we affirm the district court's decree.

I

The company's Leaf department receives, processes, and stores both domestic and Turkish tobacco for use at Branch. Its management is separate and independent from Branch's management. Leaf employs 106 regular workers, approximately 69 percent of whom are black, and 127 seasonal workers from July to the following January, 97 percent of whom are black. When this suit was filed in 1968, the average hourly wages were approximately as follows: white Branch employees, $2.90; regular black Leaf employees, $2.50; and seasonal black Leaf employees, $2.36.

The Reidsville Branch of the company receives tobacco from Leaf and makes it into cigarettes. Branch is organized into two departments--prefabrication and fabrication. Prefabrication receives tobacco from Leaf and blends, cuts, and dries it. The Fabrication department manufactures filters and cigarettes, and packs, stores, and ships the finished products. Craft employees, such as electricians, tinsmiths, and welders, are classified in fabrication, but they perform duties in prefabrication as well. Some of the black Leaf employees also work at Branch stemming tobacco.

The company's regular employees were formerly represented by racially segregated local unions. Local 192 was the bargaining agent for white employees, most of whom worked in Branch's fabrication department. The employees represented by the black union worked primarily in the Leaf department, in the prefabrication department, and as janitors in the fabrication department. Each union, and consequently, for practical purposes, each department, had a separate seniority roster. In October 1963 the racially segregated unions merged because of a directive from the United States Defense Supply Agency, issued pursuant to an executive order. Seasonal employees, however, continued to work under a separate bargaining agreement.

The merger, however, did not open the doors of the fabrication department to black employees. The district court found that through various practices both the company and the union discriminatorily preserved jobs in this department for white employees after the enactment of Title VII.

We agree with the district court that the seniority rosters of Branch and Leaf should not be merged. For example, it would be wasteful, as the appellants acknowledge, to use a merged seniority system to fill daily vacancies by shuffling employees between the plants. A company is entitled to the efficiencies it derives from maintaining separate departments and seniority rosters if this can be done without discrimination. Cf. United States v. Chesapeake & Ohio Ry Co., 471 F.2d 582, 593 (4th Cir. 1972). But the inappropriateness of merging the seniority lists does not preclude permanent transfers of employees from Leaf to fabrication at Branch without loss of seniority.

If Branch and Leaf are both parts of the same operation, this case presents a straightforward application of the well-accepted principle that discriminatory hiring in departments of a business may be remedied by requiring the company to allow transfers between departments, based on plant-wide seniority. See, e.g., Robinson v. Lorillard Corp., 444 F.2d 791 (4th Cir. 1971); Quarles v. Philip Morris, Inc., 279 F.Supp. 505 (E.D.Va.1968). The district court found that the company and the union had discriminated against black employees in staffing Branch's fabrication department. Therefore, if Leaf is considered to be another department of the company's cigarette manufacturing operations in the Reidsville area, the remedy for the discrimination found by the district court should include allowing Leaf employees to transfer to the fabrication department without losing their seniority.

If, on the other hand, Leaf and Branch are different locations, and if differences in treatment of workers at the different locations are not due to an intention to discriminate, the company's refusal to allow Leaf employees to transfer on the basis of company-wide seniority would not violate the Act. This is so because 42 U.S.C. § 2000e-2(h) provides in part:

'Notwithstanding any other provision of this subchapter, it shall not be an unlawful employment practice for an employer to apply different standards of compensation, or different terms, conditions, or privileges of employment pursuant to a bona fide seniority or merit system, . . . or to employees who work in different locations, provided that such differences are not the result of an intention to discriminate because of race, color, religion, sex, or national origin . . ..'

Neither the Act nor the EEOC regulations define the statutory term 'employees who work in different locations,' and we deem it unwise to attempt to draft a definition for every situation. It is readily apparent, however, that the labor market is the most important criterion for determining whether a company's employees work in different locations. If the labor for each plant is recruited from different geographical areas, or if one plant requires labor possessing different skills from the labor employed at another company plant, it is obvious that the company cannot draw from the same labor market to man its plants. Under these circumstances, it generally can be said that the employees work at different locations. In contrast, if a company can operate two or more of its plants with employees from the same geographical area who are unskilled or possess the same skills, an applicant for a job can be assigned to an entry level position in either plant. Therefore, these employees, having been hired from the same labor market, would not generally fall within the statutory class of 'employees who work in different locations.'

In this case, the company draws from the same labor market for both Leaf and the fabrication department of Branch. The plants are only two miles apart, and...