Stewart v. General Motors Corp.

• Citation: 542 F.2d 445
• Decision Date: 04 October 1976
• Docket Number: Nos. 76-1079,76-1080,s. 76-1079
• Parties: 13 Fair Empl.Prac.Cas. 1035, 12 Empl. Prac. Dec. P 11,260 Joe STEWART et al., Plaintiffs-Appellees, Cross-Appellants, v. GENERAL MOTORS CORPORATION, Defendant-Appellant, Cross-Appellee.
• Court: United States Courts of Appeals. United States Court of Appeals (7th Circuit)

Page 445

542 F.2d 445

13 Fair Empl.Prac.Cas. 1035,

12 Empl. Prac. Dec. P 11,260

Joe STEWART et al., Plaintiffs-Appellees, Cross-Appellants, v. GENERAL MOTORS CORPORATION, Defendant-Appellant, Cross-Appellee.

Nos. 76-1079, 76-1080.

United States Court of Appeals Seventh Circuit.

Argued April 15, 1976.

Decided Oct. 4, 1976.

Thomas R. Meites, Freda R. Merritt, Chicago, Ill., for Joe Stewart.

Michael A. Warner, Chicago, Ill., for General Motors.

Before SWYGERT and SPRECHER, Circuit Judges, and CAMPBELL, Senior District Judge. ¹

SWYGERT, Circuit Judge.

This action was brought under Title VII of the Civil Rights Act of 1964, 42 U.S.C. §§ 2000e et seq., and 42 U.S.C. § 1981, and concerns claims of racial discrimination in hiring and promotion against General Motors Corporation at its Broadview, Illinois Parts Distribution Center. Plaintiffs are black employees representing the class of black people who have been employed at this facility in hourly rated positions since December 21, 1973. Plaintiffs claim that discrimination exists at the Broadview plant with respect to: (1) promotions to the position of hourly clerk, the most desirable of the hourly rated jobs; and (2) promotions to salaried positions.

Charges were filed before the Equal Employment Opportunities Commission (EEOC) in June 1972 and an action was commenced in the District Court for the Northern District of Illinois in August 1973. The district judge found that defendant's promotional practices violate section 703 of Title VII, 42 U.S.C. § 2000e-2. Accordingly, he issued an injunction designed to prevent future racial discrimination in promotions to the position of hourly clerk and to salaried positions.

In reviewing the district court's decision, we are bound under Fed.R.Civ.P. 52(a) to accept findings of fact unless they are clearly erroneous. Prince v. Packer Mfg. Co., 419 F.2d 34, 36 (7th Cir. 1969). The statement that discrimination exists for the purposes of establishing liability under Title VII, however, is as much a conclusion of law as a finding of fact. A distinction must be drawn between subsidiary facts to which the "clearly erroneous" standard applies, and the ultimate fact of discrimination within the meaning of Title VII, which is the decisive issue to be determined in this litigation. East v. Romine, Inc., 518 F.2d 332, 338-39 (5th Cir. 1975). Accordingly, we will make an independent examination of whether defendant's conduct constitutes a violation of Title VII.

I. Discrimination in Promotions to Hourly Clerk Positions

The district court found that the position of hourly clerk is the most desirable hourly job at the Broadview plant, both because it is highly paid and because it is considered a stepping stone to salaried positions. It also found that at the time this action was instituted, twenty-five percent of the workforce at the Broadview plant was black, while none of the twenty-seven hourly clerks were black. It then held as a matter of law that under the circumstances of the case these statistics created a prima facie case of discrimination under Title VII. We agree with this conclusion. Where statistical evidence demonstrates a discrepancy between the racial composition of those promoted to a given job and the pool of eligible applicants which is too great to reasonably be the product of random distribution, the burden should be placed on the employer to show that this disparity is the product of nondiscriminatory factors. See United States v. Local 169, United Brotherhood of Carpenters, 457 F.2d 210, 214 (7th Cir.), cert. denied, 409 U.S. 851, 93 S.Ct. 63, 34 L.Ed.2d 94 (1972); Rowe v. General Motors Corp., 457 F.2d 348, 358 (5th Cir. 1972).

Defendant advances as an affirmative defense that it is utilizing a "bona fide seniority system," expressly exempted from liability under Title VII by 42 U.S.C. § 2000e-2(b), in filling hourly clerk vacancies. The district court found as a fact, however, that seniority often served only an ancillary role in determining promotions to the position of hourly clerk. Despite defendant's contention that this finding is contrary to the evidence, our examination of the record shows that it has ample support.

Since defendant has therefore failed to rebut the prima facie case which plaintiffs' statistical evidence makes out, we hold that its promotional practices with respect to the position of hourly clerk are discriminatory in violation of Title VII.

II. Discrimination in Promotions to Salaried Positions

Plaintiffs' case that discrimination existed in promotions to salaried positions is also based on statistical evidence. For example, prior to any legal pressure, only two out of ninety-seven salaried jobs were held by black people. As of the time of trial, twenty-one percent of the white employees at Broadview, compared with only nine percent of the black employees, held salaried positions. Given that the district court's statistical findings are supported by substantial evidence, we agree that the plaintiffs have again made out a prima facie case of discrimination.

Unlike its argument in the case of promotions to the position of hourly clerk, defendant does not contend that it is relying on a bona fide seniority system in filling vacancies for salaried jobs. Rather, it admits that promotions to the salaried workforce are awarded on a subjective basis which is intended to recognize merit. It then asserts that the district court's finding of a Title VII violation should be reversed because plaintiffs had failed to meet their burden of demonstrating that individual employees had been denied salaried positions because of racial discrimination.

Defendant's argument misconceives the nature of what must be proved to show discrimination under Title VII. For plaintiffs to prevail, it is not necessary that they prove scienter by showing that in individual cases General Motors consciously excluded black employees from salaried positions simply because of their race. Rather, they need only show that black employees as a group were promoted at a significantly lower rate than white employees. At that point, as we stated earlier, the burden would be on the defendant to demonstrate that racial disparity was the product of nondiscriminatory factors. The Supreme Court has defined this burden in the following way:

The Act proscribes not only overt discrimination but also practices that are fair in form, but discriminatory in operation. The touchstone is business necessity. If an employment practice which operates to exclude Negroes cannot be shown to be related to job performance, the practice is prohibited. Griggs v. Duke Power Co., 401 U.S. 424, 431, 91 S.Ct. 849, 853, 28 L.Ed.2d 158 (1971).

General Motors has failed to meet this test. The district court characterized the promotion process with respect to salaried jobs as "highly subjective and loosely structured." It noted that supervisory recommendations play an important role in the promotion process, but that no significant safeguards exist to ensure that the recommendations are focused on the relevant issues in promotion. Foremen asked to make recommendations have no objective way of rating the employees whom they are evaluating. Moreover, they are never given written guidelines delineating the criteria for which they are supposed to be looking or describing the jobs for which they are making recommendations. Finally, almost all of the foremen at the Broadview plant are white.

We hold that such a system of filling vacancies is not job-related within the meaning of Griggs. The process described, while perhaps intended only to recognize merit, is highly susceptible to abuse. While some subjectivity is inevitable in filling jobs of an executive character, the total lack of objective standards at Broadview could only reinforce the prejudices, unconscious or not, which Congress in Title VII sought to eradicate as a basis for employment. In condemning promotional systems where employees of a minority race have been excluded by a process in which objective standards are lacking, we are in accord with a number of other courts. See, e. g., Muller v. United States Steel Corp., 509 F.2d 923, 929 (10th Cir.), cert. denied, 423 U.S. 825, 96 S.Ct. 39, 46 L.Ed.2d 41 (1975); Pettway v. American Cast Iron Pipe Co., 494 F.2d 211, 240-43 (5th Cir. 1974); United States v. N. L. Industries, Inc., 479 F.2d 354, 368 (8th Cir. 1973); Rowe v. General Motors, 457 F.2d 348, 358-59 (5th Cir. 1972).

We therefore affirm the district court's holding that defendant's promotional practices with respect to salaried positions violate Title VII.

III. Remedies

A. The District Court's Decree

The district court issued an injunction designed to prevent future racial discrimination in employment at the Broadview plant. We affirm all of the decree except for subsection (A)(1) ² calling for vacancies in hourly positions to be filled by the employee with the highest seniority on the shift on which the vacancy occurs. The record shows that while about two-thirds of the hourly clerk's jobs are on the day shift, about two-thirds of the black hourly employees work on the night shift. Therefore, a rule that seniority can only be used to obtain a promotion within the same shift on which it was accrued will have the effect of locking a majority of the black employees who have suffered discrimination into an inferior status. Accordingly, the decree should be modified to call for vacancies in hourly clerk positions to be filled by the employee with the greatest seniority, regardless of on what shift he is working or accrued that seniority.

B. Backpay

1. General Principles

Though plaintiffs asked for backpay as a part of the remedy to be imposed for a Title VII violation, the district court never addressed this issue. Since we find this claim to be meritorious, we remand this case to the district court with instructions to award backpay within the constraints of the guidelines which w...