Memorandum on Pending Steel Consent Decree Litigation

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CONSENT MEMORAN 

The NAACP Legal Defense and Educational Fund is asking the U. S. 

nt decr of Appeals for the Fifth Circuit to set aside the cons 

last April by nine maj 

nent. include 
and the gover: 

ent practices -- and back pay injunctive reli, atory employm 

amounting to about $30 million to compensate minority employees for past 

discrimination, 

Ostensibly, the agreement was intended to cover the steel 

hiring-and promotion obligations under Title VII of the Civil 

1964. Purportedly, it solves all of the civil rights cla: 

thonsands of black. Hispania and women workers emploved since 

than 200 plants locat 

But civil rights advocates vie the decrees as illegal co 

which have thrown the future of Title VII suits into doubt; as 

exempting or limiting company and union liability 

ard unions to make a national 

The Legal Defense Fund, therefore, has asked the Fifth Circuit court 

te consider the question: Can federal of: icials bargain away the 

machinery established by Congress to end discrimination -- in return 

promises by employers and unions to stop breaking the law? The problem 

of substantial public importance, since th government within the st year 

has entered into simil a is volving hundreds of thousands of employees agreement: 

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et 

The steel accord eneieusly is not an isolated phenomenon. For ten 

years, employes have tried unsuccessfully to make government lawsuits the 

exclusive remedy for employment litigation. And Congress repeatedly (in 

1964 and again in 1972) rejected efforts to limit the carefully designed 

structure of independent remedies, recognizing that there should be several 

avenues of public and private redress. 

Consequently, it is understandable that steel negotiations were 

entered into by government and ind@ustry lawyers following an action such as 

Williamson v. Bethlehem Steel Corp., a case which on November 3, 1972 

reaffirmed the right of minority employees to bring a private action for 

full relief after the government sued and obtained partial relief. 

‘whe most compelling pressure to hammer out an industry-wide agreement, 

however, stemmed from Ford v. U. S. Steel, a case decided in early 1973. 

The Ford case was a series of interrelated lawsuits (consolidated by the 

district court in Birmingham) which included three actions brought by the 

Legal Defense Fund against U. S. Steel's Fairfield Works and the local and 

national steelworkers' unions. 

Following seven years of litigation by LDF lawyers, the district 

court outlawed separate lines of progression in seniority systems and 

awarded $201,000 in back pay to 61 black workers as compensation for past 

discrimination. The Justice Department also obtained similar injunctive 

relief for 3,000 other black employees in that same plant. But the Department. 

was unable to win back pay, whereupon LDF promptly intervened in that suit 

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and is seeking -- on appeal -- back pay which may amount to millions of 

dollars for the 3,000 workers. 

The legal principles established in Birmingham, plus the fact that 

the Legal Defense Fund was conducting litigation of a comparable nature 

against three other major steel companies on precisely the same issues, 

set the stage for the consent decrees. Im short, the industry was confronted 

by massive potential liabilities; it had little to gain by continuing a 

hard-line approach to litigation -- and a great deal to gain by negotiating 

consent decrees. 

“LF lawyers assert that, under the provisions of the decrees: 

1) The steel companies have the power to offer each affected employee 

a cash settlement in return for a waiver of all prospective and accrued rights; 

or as expressed by the decrees: a release of "any claim ... resulting from 

any alleged violations ... of any equal employment opportunity laws." The 

Legal Defense Fund contends that the proposed waivers contravene public policy 

and are invalid because: 

They are prospective in nature and deprive employees of 

any relief if the defendants fail to remedy the effects 

of past discrimination. 

They require employees to waive their rights to maintain 
private litigation as a condition to receiving benefits 

under government litigation. 

They prevent employees from obtaining full monetary 
compensation for past discrimination. 

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cae 

2) Three government agencies (the Justice Department, EFCC and 

the Labor Department) are obliged to advise the court that relief is 

unwarranted in any private action relating to "systemic" issues: i.e. to 

seniority systems, pattemsof employment, or minority recruitment policies 

Supposedly resolved by the decrees. Many of the critical decisions bearing 

on seniority rights and transfer procedures, however, will not be made until 

employees sign waivers Meanwhile, government lawyers will serve as a legal 

arm of employers and unions. 

+3) Those responsible for discriminatory employment practices will 

enforce the decrees which are supposed to end discrimination. As stipulated 

in the agreement, the decrees will be administered at each plant by 

Implementation Committees which, in turn, will be overseen by an Audit and 

Review Committee. Each of these committees will be dominated by representa- 

tives of the defending companies and unions. 

4) Provisions for adequate judicial review are nonexistent. The 

agreement does not require the industry to provide information regarding 

compliance or the effectiveness of the decrees, either to the government or 

the court. If the government asks for and receives information from the 

companies, it in turn has no obligation to provide that information to the 

court. In short, the decrees are not designed to give the court information; 

instead they are designed to confer an absolute veto over what information 

the court can obtain. 

The agreement, moreover, is extraordinary in a number of other ways: 

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* It was arrived at through government-industry negotiations which 

deliberately excluded representation of those discriminated against. It was 

then approved by the Northern District Court of Alabama in an in camera 

proceeding on April 12 without prior disclosure and with no opportunity for 

concerned parties to intervene. 

* Because the government must side with defending companies in any 

instance where plaintiffs ask for more relief than provided in the consent 

decrees, government has surrendered much of its future role. The decrees, 

moreover, do not purport to remedy individual acts of discrimination. If a 

man was fired prior to the consent decrees, and can prove he was fired for 

racial reasons, EEOC can no longer sue on his behalf even though, under 

Title VII, the government is obliged to provide legal assistance. 

+ Before a worker's complaint gets referred to an Implementation 

Committee, it must contain the words, Decree Related. But there is no assur- 

ance that any worker will know anything about the committees, let alone the 

magic words. If the phrase is excluded, the complaint goes through normal 

employer-union contractual channels. 

+ One major area of contention is the use of tests that are not 

relevant to job performance. The decrees do not get rid of a single discrim- 

inatory test. The companies and unions have pledged that they will stick to 

EEOC regulations on testing, which they are supposed to do anyway. 

+ Goals and timetables for training and promotion to supervisory 

positions are based on the number of women and blacks presently employed 

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in the steel industry. Since women now represent less than one per cent 

of the work force, their participation will be relatively negligible. 

+ Nobody can state what $30 million in back pay means in terms of 

60-65,000 minority steel workers, or how the figure was arrived at. Is it 

an equitable figure, or is it inadequate when compared with back pay awards 

previously won in other steel actions? 

Shortly after the consent decrees were approved in the district court, 

the Legal Defense Fund filed a motion to intervene on behalf of all black 

steel Gores The Fund also represents 13,000 employees in other and 

separate actions against companies participating in the consent decrees. 

They are Republic Steel (Birmingham, Ala.), U. S. Steel (Fairfield, Ala.), 

Armco (Houston, Tex.), Republic Steel (Gadsden, Ala.), Bethlehem Steel 

(Sparrow Point, Md.), and U. S. Steel (Homestead, Pa.). 

Despite assertions by all parties that the agreement would not affect 

prior and pending actions, the decrees obviously are having an insidious effect 

adverse to the plaintiffs' positions. In some district courts, steel company 

lawyers are taking the position that the decrees solve all discrimination 

problems in the industry -- that the cases therefore are moot. They contend 

no relief should be awarded in pending steel cases because ali necessary relief 

is incorporated in the consent decrees. 

In the Legal Defense Fund's case against U. S. Steel’s Homestead plant, 

a district court judge in Pittsburgh employed the decrees as a reason for 

halting all action until January 15, 1975 so that the companies and unions 

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would be able to resolve the case under provisions of the consent decrees. 

The judge also prohibited the Fund's attorneys from discussing the agreement 

with a group of black workers who requested information about the decree 

and stopped all discovery, i.e. methods by which lawyers accumulate evidence 

for trial. 

The Fund's lawyers contend that the delay increases the likelihood 

that minority workers, without access to counsel, would be overreached and 

and suxrender their just claims to back pay in return for an offer representing 

only a ‘fraction of what they might otherwise obtain. The case has been 

appealed, and the U. S. Court of Appeals for the Third Circuit heard oral 

Er on “Octoner 24¢