Loeffler v. Tisch Brief for the Respondent

    No. 86-1431

3 n  tf)e S u prem e C o u rt of tfje Mruteti i&>tate£
O ctober  T e r m , 1987

T h eodore  J . L o effler , petitio n er

v .

P reston  R. T isc h , P ostm aster  G eneral 
of T he U nited  States

ON WRIT OF CERTIORARI TO 
THE UNITED STA TES COURT OF APPEALS FOR 

THE EIGHTH CIRCUIT

BRIEF FOR THE RESPONDENT

Charles Fried 
Solicitor General

Donald B. Ayer 
Deputy Solicitor General

Charles A. Rothfeld 
Assistant to the Solicitor General

John F. Daly 
A ttorney

Department o f Justice
LouisA. Cox Washington, D.C. 20530

Genera! Counsel (202) 633-2217

Stephen E. Alpern 
Associate General Counsel

Kevin Rachel 
Senior A ttorney 
United States Postal Service 
Washington, D.C. 20260-1134



QUESTION PRESENTED

Whether prejudgment interest may be awarded against 
the United States Postal Service in a suit brought pursuant 
to Section 717 of Title VII of the Civil Rights Act of 1964, 
42 U.S.C. 2000e-16.

(I)





TABLE OF CONTENTS

Opinions below............................................................................  1
Jurisdiction ..................................................................................  1
Statutes involved ...........................   1
Statement .................................................................................... 2
Introduction and summary of argum ent...................................  4
Argument:

Sovereign immunity bars an award of prejudgment in­
terest against the Postal Service in a suit under Section 
717 of Title V II ....................................................................  7
A. Section 717 sets forth a comprehensive set of

remedial procedures that differ from those governing 
private sector Title VII actions...................................  7

B. Congress has included the Postal Service in the
federal sector for purposes of Title VII Litigation . . .  9

C. Section 717 of Title VII, not Section 401(1) of the 
Postal Reorganization Act, is the source of the waiver
of sovereign immunity in this case .............................  II

D. The remedy created by Section 717 does not provide
for awards of interest..................................................  15

Conclusion ........................................................   24
Appendix.....................................................................................  la

TABLE OF AUTHORITIES

Cases:
A.L.T. Corp. v. SB A, 823 F.2d 126 (5th Cir. 1987).......... 18
Ass’n o f American Publishers, Inc. v. Governors o f the

USPS, 485 F.2d 678 (D.C. Cir. 1973)...........................  14
Blakev. Califano, 626 F.2d 891 (D.C. Cir. 1980).............  4
Brown v. GSA, 425 U.S. 820 (1976)....................... 5, 7, 8, 9, 12
Caninov. EEOC, 707 F.2d 468 (11th Cir. 1983)...............  13
Chandler v. Roudebush, 425 U.S. 840 (1976).....................  8
Chelsea Neighborhood Ass’ns v. USPS, 516 F.2d 378 (2d

Cir. 1975).................................................................   19
Contemporary Mission v. USPS, 648 F.2d 97 (2d Cir.

1981) ...............................................................................  16

Page

( H I )



IV

Cooper v. USPS, 34 Fair Empl. Prac. Cas. (BNA) 985 
(S.D. Cal. 1983), aff’d, 740 F.2d 714 (9th Cir. 1984),
cert, denied, 471 U.S. 1022 (1985)................................. 13, 23

Cross v. USPS, 733 F.2d 1327, affd, 733 F.2d 1332 (8th
Cir. 1984), cert, denied, 470 U.S. 1051 (1985)...............  2, 23

Davisv. Califano, 613 F.2d 957 (D.C. Cir. 1979).............  13
deWeever v. United States, 618 F.2d 685 (10th Cir.

1980) ...............................................................................  4
Ellis v. USPS, 784 F.2d 835 (7th Cir. 1986).......................  13
Federal Housing Administration v. Burr, 309 U.S. 242

(1940).............................................................................. 14, 17
Fischerv. Adams, 572 F.2d 406 (1st Cir. 1978).................  4
Florida Dep’t o f  Health & Rehabilitative Services v.

Florida Nursing Home Ass’n, 450 U.S. 147(1981)........ 18
Franchise TaxBoardv. USPS, 467 U.S. 512 (1984)...........  3-4,

5, 12, 14, 17, 18, 23
Frazier v. USPS, 790 F.2d 873 (Fed. Cir. 1986)...............  21
Hill v. National Flood Ins. Program (In re Estate o f Lee),

812 F.2d 253 (5th Cir. 1987)............................................ 18
Insurance Co. o f North America v. USPS, 675 F.2d 756

(5th Cir. 1982).................................................................. 16
Jacobs v. Bolger, 587 F. Supp. 374 (W.D. La. 1984),

aff’d, 759 F.2d 20 (5th Cir. 1985)................................... 23
Jarrell v. USPS, 753 F.2d 1088 (D.C. Cir. 1985).............  23
King v. Bailor, 444 F. Supp. 1093 (S.D.N.Y. 1978).........  23
Lehman v. Nakshian, 453 U.S. 156 (1981).......................  11
Library o f Congress v. Shaw, No. 85-54 (July 1, 1986) .. .passim
McGuinness v. USPS, 744 F.2d 1318 (7th Cir. 1984)........ 13
Merced Production Credit Ass’n v. Sparkman (In re

Sparkman), 703 F.2d 1097 (9th Cir. 1983).....................  18
Morgan v. USPS, 798 F.2d 1162 (8th Cir. 1986), cert.

denied, No. 86-5979 (Mar. 30, 1987)............................. 13
Nagyv. USPS, 773 F.2d 1190 (11th Cir. 1985)............. . . 3, 23
National Ass’n o f Postal Supervisors v. USPS, 602 F.2d

420 (D.C. Cir. 1979)........................................................  14
Newbold v. USPS, 614 F.2d 46 (5th Cir.), cert, denied,

449 U.S. 878 (1980)........................................................  13, 23
Painter v. TV A, 476 F.2d 943 (5th Cir. 1973)................... 18
Quillen v. USPS, 564 F. Supp. 314 (E.D. Mich. 1983) . . . .  23
R & R Farm Enterprises v. Federal Crop Insurance 

Corp., 788 F.2d 1148 (5th Cir. 1986).............................

Cases —Continued: Page

18



V

Reconstruction Finance Corp. v. J.G. Menihan Corp.,
312 U.S. 81 (1941)..........................................................  17

Richerson v. Jones, 551 F.2d 918 (3d Cir. 1977)...............  4
Saunders v. Claytor, 629 F.2d 596 (9th Cir. 1980), cert.

denied, 450 U.S. 980(1981)............................................. 4
Segar v. Smith, 738 F.2d 1249 (D.C. Cir. 1984), cert.

denied, 471 U.S. 1115 (1985)........................................... 4
Soriano v. United States, 352 U.S. 270(1957)...................  12
Sportique Fashions, Inc. v. Sullivan, 597 F2d 664 (9th

Cir. 1979)..........................................    16
Standard Oil Co. v . United States, 267 U.S. 76 (1925) . . . .  18
Tw/Fs v. l/SPS, 431 F. Supp. 484 (N.D. Ohio 1976).......... 23
United Statesv. Testan, 424 U.S. 392 (1976).....................  11
United States v. Worley, 281 U.S. 339 (1930)...................  18

Constitution, statutes and regulations:

U.S. Const. Amend. X I ......................................................  18
Age Discrimination in Employment Act of 1967, 29

U.S.C. 633a......................................................................  22
Civil Rights Act of 1964:

Tit. VI, 42 U.S.C. 2000d et seq...................................  20
Tit. VII, 42 U.S.C. 2000e et seq...................................passim

§ 701, 42 U.S.C. 2000e(b)...................................  7
§ 705, 42 U.S.C. 2000e-4 n o te .............................  9
§ 706(a), 42 U.S.C. 2000e-5(a)...........................  9
§ 706(f), 42 U.S.C. 2000e-5(f).............................  9
§ 717, 42 U.S.C. 2000e-16 (Pub. L. No. 92-261,

§ 11, 86 Stat. I l l ) ........................................... passim,
la-4a

§ 717(a), 42 U.S.C. 2000e-16(a).........................  10 ,1a
§ 717(b), 42 U.S.C. 2000e-16(b).........................  8, la
§ 717(c), 42 U.S.C. 2000e-16(c) . . . . .  .6, 7, 8, 9, 12, 3a 
§ 717(d), 42 U.S.C. 2000e-16(d).........................  7, 3a

Civil Service Reform Act of 1978:
5 U.S.C. 3102.............................................................. 22
5 U.S.C. 3110.............................................................. 21
5 U.S.C. 5532 .............................................................. 21
5 U.S.C. 7211 .............................................................  22
5 U.S.C. 7501 et seq....................................................... 20

Cases —Continued: Page



VI

Contract Disputes Act of 1978, 41 U.S.C. (& Supp. Ill)
601 et seq........................................................................... 19

41 U.S.C. 601(2)..........................................................  19
Contract Work Hours Standards Act, 40 U.S.C. (&

Supp. Ill) 327 et seq.........................................................  19
Davis-Bacon Act, 40 U.S.C. 276a et seq.............................  19
Debt Collection Act of 1982, 5 U.S.C. 5514(a)(4)(B)........ 22
Federal Employees’ Compensation Act, 5 U.S.C. 8101

et seq..................................................................................  20
Federal Pay Comparability Act of 1970:

5 U.S.C. 5301(a)(3)....................................................  21
5 U.S.C. 5305(c)(1)......................................................  21

Federal Tort Claims Act:
28 U.S.C. 1346(b)............    3
28 U.S.C. 2671 et seq...................................................  3
28 U.S.C. 2679(a)........................................................  16

Freedom of Information Act, 5 U.S.C. 552 .....................  19
Government in the Sunshine Act, 5 U.S.C. 552b..............  19
Government Losses in Shipment Act, 40 U.S.C. 721

et seq.................................................................................. 19
Miller Act, 40 U.S.C. (& Supp. Ill) 270a et seq................ 19
Occupational Safety and Health Act of 1970, 29 U.S.C.

688 ...................................................................................  21
Postal Reorganization Act, 39 U.S.C. (& Supp. Ill)

101 et seq..........................................................................  3,5
39 U.S.C. 101(c)..........................................................  21
39 U.S.C. 201 .............................................................. 19
39 U.S.C. 202 .............................................................. 14
39 U.S.C. (Supp. Ill) 202(a)....................................... 20
39 U.S.C. 203 .............................................................. 14
39 U.S.C. 401(1)....................................................passim, la
39 U.S.C. 401(2)..........................................................  19
39 U.S.C. 401(9)..........................................................  19
39 U.S.C. 402 .............................................................. 14
39 U.S.C. 404(7)..........................................................  19
39 U.S.C. 407 .............................................................. 19
39 U.S.C. 408 .............................................................. 19
39 U.S.C. 409(b)..........................................................  19

Statutes and regulations — Continued: Page



VII

39U.S.C. 409(c)..........................................................  16, 19
39 U.S.C. 410(a)..........................................................  19
39U.S.C. 410(b)(1)................................................ 19, 21, 22
39 U.S.C. 410(b)(2).................................................... 19
39 U.S.C. 410(b)(4).................................................... 19
39 U.S.C. 410(b)(4)(B)................................................. 19
39 U.S.C. 410(b)(4)(C)................................................. 19
39 U.S.C. 410(b)(4)(E) .....................    19
39 U.S.C. 410(b)(4)(F)...............................................  19
39 U.S.C. 410(b)(5) . . . .  ............. ..............................  19
39 U.S.C. 410(b)(5)(A)..............................................  19
39 U.S.C. 410(b)(5)(B)...............................................  20
39 U.S.C. 410(b)(6).................................................... 20
39 U.S.C. 410(b)(7).................................................... 21
39 U.S.C. 410(b)(8).................................................... 20
39 U.S.C. 411 ...............................................    19
39 U.S.C. 601 ..............................   19
39 U.S.C. 603 .............................................................  19
39 U.S.C. 1001 et seq..................................................  20
39 U.S.C. 1001(b).......................................................  20
39 U.S.C. 1005(a)(1)..................................................  21
39 U.S.C. 1005(a)(2).................................................. 20, 21
39 U.S.C. 1005(c)........................................................ 20
39 U.S.C. 1005(d).......................................................  20
39 U.S.C. 1006 ............................................................ 20
39 U.S.C. 1011 ............................................................ 22
39 U.S.C. 1201 et seq................................................... 20
39 U.S.C. 1206 ............................................................ 20
39 U.S.C. 1209 ............................................................ 20
39 U.S.C. 2003(a).......................................................  20
39 U.S.C. 2009 ...........................................................  20
39 U.S.C. 3003 ...........................................................  19
39 U.S.C. 5206 ...........................................................  19
39 U.S.C. 5403 ...........................................................  19
39 U.S.C. 5604 ...........................................................  19

Program Fraud Civil Remedies Act of 1986, 31 U.S.C.
3801(a)(1)(D).................................................................... 19

Rehabilitation Act of 1973, 29 U.S.C. (& Supp. Ill) 701 et 
seq.:

29 U.S.C. (& Supp. Ill) 791(b)...................................  22
29 U.S.C. 792(a)(l)(B)(x) ........................................... 22

Statutes and regulations —Continued: Page



VIII

Service Contract Act of 1965, 41 U.S.C. 351 et seq............  20
Walsh-Healey Act, 41 U.S.C. (&Supp. 111)35 et seq........  19
5 U.S.C. 3333 ....................................................................  21
5 U.S.C. 5520 ..................................................................... 21
5 U.S.C. (Supp. Ill) 5734 .................................................  21
5 U.S.C. 7151 (recodified at 5 U.S.C. 7201 (Pub. L. No.

95-454, § 703(a)(1), 92 Stat. 1216))................................. 10
5 U.S.C. (& Supp. Ill) 7301 et seq...................................... 21
5 U.S.C. 7311..................................................................... 21
5 U.S.C. 8301 et seq............................................................ 20
42 U.S.C. 4151 et seq...........................................................  20
Exec. Order No. 11, 478, 3 C.F.R. 803 (1966-1970 comp.) 11 
29 C.F.R.:

Sections 1613.211-1613.222 ......................................... 8
Section 1613.218..........................................................  8
Section 1613.220(d) ....................................................  8
Section 1613.281..........................................................  8

Miscellaneous:

116 Cong. Rec. (1970):
p. 19847 .......................................................................  22
p.19849 .......................................................................  22
p. 19852 .......................................................................  22
pp. 22279-22280 ..........................................................  10
p. 22309 .......................................................................  22
p. 22334 ...........    22
p. 22340 .......................................................................  22
p. 22344 .............      22
p. 26953 .......................................................................  10
p. 26955 .......................................................................  10, 11
p. 26956 .......................................................................  10
p. 26957 .......................................................................  10, 11
p. 27597 ...............    10
p. 27607 ......................................................................  10, 11

118 Cong. Rec. (1972):
p. 4922 .........................................................................  12
p. 4929 .........................................................................  12

Statutes and regulations — Continued: Page



IX

Miscellaneous-Continued: Page

H.R. 348, 100th Cong., 1st Sess., 133 Cong. Rec. H6978 
(daily ed. Aug. 3, 1987)..................................................  21

H.R. Rep. 92-238, 92d Cong., 2d Sess. (1971).................  12
H.R. Rep. 98-425, 98th Cong., 2d Sess. (1984).................  21
S. Rep. 92-415, 91st Cong., 1st Sess. (1971).....................  12



3 n  tf)e Suprem e Court of tt)e U niteb s t a t e s
O ctober  T erm, 1987

No. 86-1431
T h eodore  J. L o effler , petitio n er

v.

P reston  R. T isc h , P ostm aster  G eneral 
o f  T he U nited  States

ON WRIT OF CERTIORARI TO 
THE UNITED ST A TES COURT OF APPEALS FOR 

THE EIGHTH CIRCUIT

BRIEF FOR THE RESPONDENT

OPINIONS BELOW

The opinion of the en banc court of appeals (Pet. App. 
A l-A ll) is reported at 806 F.2d 817. The panel opinion of 
the court of appeals (Pet. App. A12-A20) is reported at 
780 F.2d 1365. The opinions and orders of the district 
court (Pet. App. A21-A34) are unreported.

JURISDICTION

The judgment of the en banc court of appeals was 
entered on December 8, 1986. The petition for a writ of 
certiorari was filed on March 5, 1987, and was granted on 
June 22, 1987. The jurisdiction of this Court is invoked 
under 28 U.S.C. 1254(1).

STATUTES INVOLVED

The texts of 39 U.S.C. 401(1) and 42 U.S.C. 2000e-16 
are set out in an appendix to this brief.

( 1)



2

STATEMENT

1. Petitioner was employed by the United States 
Postal Service (Postal Service or USPS) as a rural letter 
carrier. In 1980 he was discharged from his position for 
repeatedly refusing to follow prescribed procedures in 
preparing his mail for delivery. After unsuccessfully seek­
ing administrative relief, petitioner brought this suit 
against the Postmaster General pursuant to Section 717 of 
Title VII of the Civil Rights Act of 1964, 42 U.S.C. 
2000e-16, arguing that he had been discharged as a result 
of sex discrimination. After a bench trial, the United 
States District Court for the Eastern District of Missouri 
ruled for petitioner; the court found that the Postal Serv­
ice had not discharged two female rural letter carriers 
although they had engaged in the same misconduct as peti­
tioner. Pet. App. A26-A30. The district court accordingly 
ordered petitioner reinstated with backpay (id. at 
A26-A34). But the court held that the United States’ 
sovereign immunity foreclosed the addition of prejudg­
ment interest to the backpay award (id. at A21).

On appeal, a panel of the Eighth Circuit, relying on that 
court’s prior opinion in Cross v. USPS, 733 F.2d 1327, 
aff’d en banc by an equally divided court, 733 F.2d 1332 
(1984), cert, denied, 470 U.S. 1051 (1985), affirmed the 
denial of prejudgment interest against USPS, holding that 
an award of interest was barred by sovereign immunity 
(Pet. App. A19-A20). The panel’s ruling was in turn af­
firmed by a six-to-five vote of the en banc Eighth Circuit 
(id. at Al-Al 1).

The majority adopted the reasoning of the Cross panel, 
adding that its “conclusion is strongly reinforced by the re­
cent decision of the Supreme Court in Library o f Congress 
v. Shaw, [No. 85-54 (July 1, 1986)], holding that Congress, 
in enacting Title VII, did not waive the Government’s im­
munity from interest” (Pet. App. A2). In reaching this



3

conclusion, the court of appeals found it irrelevant that 
Congress has permitted USPS to “sue and be sued in its of­
ficial name” (39 U.S.C. 401(1)). The court noted that, 
while the “sue and be sued” clause was enacted in 1970 as 
part of the Postal Reorganization Act, 39 U.S.C. (& Supp. 
Ill) 101 et seq., Congress did not authorize Title VII ac­
tions against the Postal Service until 1972. The court 
therefore explained that petitioner’s action “was not 
brought under the sue-and-be-sued clause of the Postal 
Reorganization Act. Instead it was brought under Title 
VII as amended in 1972” (Pet. App. A4). In these cir­
cumstances, the court concluded that “the scope of [peti­
tioner’s] remedy must be determined by reference to the 
federal sector provisions of Title VII, and not b[y] 
reference to the sue-and-be-sued clause of the Postal 
Reorganization Act” (id. at A5).

The court found support for its conclusion in the 
uniform judicial recognition that the Federal Tort Claims 
Act, 28 U.S.C. 1346(b), 2671 et seq., and not the Postal 
Reorganization Act’s “sue and be sued” clause, provides 
the waiver of immunity for tort actions against the Postal 
Service (Pet. App. A6). And the court observed both that 
“Congress explicitly treated the Postal Service as a federal 
agency when it amended Title VII in 1972 to make the 
Postal Service and other federal agencies amenable to suit 
under Title VII,” and that “the Postal Service’s legal rela­
tionship with its employees is predominantly that of a 
federal agency, not that of an ordinary business” (id. at 
A7). The court therefore found it “apparent that Congress 
did not intend to place postal employees in a better posi­
tion than all other federal employees with respect to in­
terest in Title VII cases” (id. at A8).

Judge Arnold, joined by four other judges, dissented 
(Pet. App. A8-A11). He noted that the en banc court’s 
holding “creates a square conflict” with Nagy v. USPS, 773 
F.2d 1190 (11th Cir. 1985), and he found support for peti­
tioner’s position in Franchise Tax Board v. USPS, 467



4

U.S. 512 (1984) (Pet. App. A9). And while he observed 
that “there are respects, and important ones, in which the 
Postal Service is unlike a private employer,” Judge Arnold 
doubted “that sovereign immunity with regard to an or­
dinary incident of relief in a civil action is one of those dif­
ferences” (id. at A10). He therefore would have held “the 
Postal Service to be like a private commercial enterprise 
for purposes of sovereign immunity” (ibid.).

INTRODUCTION AND SUMMARY OF ARGUMENT

It is common ground that an award of interest against 
the federal government is permissible only if the United 
States has waived the sovereign immunity that would 
otherwise bar such an award. See Library o f Congress v. 
Shaw, No. 85-54 (July 1, 1986), slip op. 4. And it is equal­
ly clear-as both petitioner (Pet. Br. 17) and the dissenters 
below (Pet. App. A9) acknowledge-that Congress gen­
erally has not made interest available to federal employees 
who obtain backpay from the government under Section 
717 of Title VII of the Civil Rights Act of 1964, 42 U.S.C. 
2000e-16. That conclusion necessarily follows from this 
Court’s holding in Shaw that sovereign immunity bars the 
payment of interest on attorneys’ fees awarded against the 
government under Title VII (see slip op. 12).1 The ques­
tion in this case therefore is whether Congress has created

1 Prior to Shaw, the courts of appeals had uniformly held that in­
terest is not available on Title VII backpay awards against the govern­
ment. See Segar v. Smith, 738 F.2d 1249, 1296 (D.C. Cir. 1984), cert, 
denied, 471 U.S. 1115 (1985); Saundersv. Claytor, 629 F.2d 596, 598 
(9th Cir. 1980), cert, denied, 450 U.S. 980 (1981); Blake v. Califano, 
626 F.2d 891, 894 (D.C. Cir. 1980); deWeever v. United States, 618 
F.2d 685, 686 (10th Cir. 1980); Fischer \ .  Adams, 572 F.2d 406, 411 
(1st Cir. 1978); Richerson v. Jones, 551 F.2d 918, 925 (3d Cir. 1977).



5

a special rule that waives the government’s immunity 
against Title VII interest awards for Postal Service 
employees, but not for other federal workers.

In asserting that Congress has created such a rule —and 
in thus seeking to escape from what otherwise would be 
the concededly dispositive holding of Shaw—petitioner 
focuses exclusively on 39 U.S.C. 401(1). That provision, 
enacted in 1970 as part of the Postal Reorganization Act 
that created the Postal Service, 39 U.S.C. (& Supp. Ill) 
101 etseq., provides that USPS has the power “to sue and 
be sued in its official name.” Citing Franchise Tax Board 
v. USPS, 467 U.S. 512 (1984), and a number of this 
Court’s earlier decisions, petitioner contends that such 
“sue and be sued” clauses generally are viewed as broad 
waivers of sovereign immunity that should be broadly con­
strued to permit awards of interest. But whatever the 
validity of this mode of interpretation in other contexts, it 
has no application here.

In creating the Section 717 discrimination remedy in 
1972, Congress recognized a distinct class of federal Title 
VII defendants that are dealt with differently from those 
in the private sector. This new federal sector remedy 
“create[dj an exclusive, pre-emptive administrative and 
judicial scheme for the redress of federal employment 
discrimination.” Brown v. GSA, 425 U.S. 820, 829 (1976). 
By compelling federal sector defendants to play an active 
administrative role in this new federal sector process, Con­
gress in Section 717 created a structure that differs 
dramatically from that used to process complaints of 
employment discrimination in the private sector.

This background makes it clear that the terms of Section 
717-which concededly does not provide for interest-are 
controlling in this case. When Congress lifted the govern-



6

merit’s immunity from suit under Title VII in 1972, it set 
out in precise terms the nature of the action as to which 
sovereign immunity was being waived. It is therefore the 
scope of the Section 717 waiver that is controlling here. As 
the court of appeals explained, the fact that Congress 
previously had made the Postal Service amenable to other 
types of lawsuits under Section 401(1) is a fortuity that has 
no application in this case. Indeed, Sections 717 and 
401(1) in terms authorize suits against different entities. 
Section 717(c) waives the government’s immunity in Title 
VII suits against “the head of the [plaintiff’s] department, 
agency, or unit”; Section 401(1), in contrast, makes the 
Postal Service amenable to suit “in its official name.”

In any event, even if Section 401(1) somehow is deemed 
the provision that provides the waiver of immunity in this 
case, Postal Service employees are accorded their cause o f  
action by Section 717. Section 401(1) (assuming that it is 
relevant here at all) simply makes the Postal Service 
amenable to process. The scope of the available recovery is 
spelled out by Section 717-a  statute that does not provide 
for awards of interest. And there is nothing anomalous in 
treating Postal Service employees the same as other federal 
sector workers for purposes of Section 717, as petitioner 
contends. Congress explicitly viewed Postal Service 
employees as federal workers for a wide range of pur­
poses. In particular, Congress consistently has treated 
Postal Service workers like their counterparts at other 
federal agencies for purposes of equal employment oppor­
tunity. Against this background, it is hardly likely that 
Congress intended to place Postal Service employees in a 
better position than all other federal employees with 
respect to prejudgment interest in Title VII cases.



7

ARGUMENT

SOVEREIGN IMMUNITY BARS AN AWARD OF PREJUDG­
MENT INTEREST AGAINST THE POSTAL SERVICE IN A 
SUIT UNDER SECTION 717 OF TITLE VII

A. Section 717 Sets Forth A Comprehensive Set of Remedial Pro­
cedures That Differ From Those Governing Private Sector 
Title VII Actions

When Congress enacted Title VII in 1964, the statute’s 
definition of “employers” who are subject to suit excluded 
(as it still does) both the United States and any “corpora­
tion wholly owned by the Government of the United 
States.” 42 U.S.C. 2000e(b). In 1972, Congress amended 
Title VII by adding a Section 717 that makes federal 
employers subject to suit for employment discrimination. 
Pub. L. No. 92-261, § 11, 86 Stat. I l l ,  codified at 42 
U.S.C. 2000e-16. This enactment accomplished two 
things. It provided a cause of action for federal employees 
who are subjected to discriminatory personnel actions. 
And at the same time, by making the United States 
amenable to a civil action (see 42 U.S.C. 2000e-16(c)) and 
liable for backpay and related remedies (see 42 U.S.C. 
2000e- 16(d)), “Congress effected a waiver of the Govern­
ment’s immunity from suit.” Shaw, slip op. 12. This enact­
ment amounted to what petitioner has labeled a “substan­
tive waiver” of sovereign immunity (Pet. Br. 5) —a 
precisely-defined waiver that is applicable on a govern­
ment-wide basis. And that waiver was effected not by add­
ing the federal government to the list of employers already 
subject to Title VII, but by enacting a new Section 717 (42 
U.S.C. 2000e-16), titled “Employment by Federal Govern­
ment,” that “create[d] an exclusive, pre-emptive adminis­
trative and judicial scheme for the redress of federal 
employment discrimination.” Brown v. GSA, 425 U.S. 
820, 829 (1976).



8

The new remedy created by Section 717 compels the fed­
eral sector defendant to play an active administrative role 
in dealing with discrimination complaints in a way that the 
private sector defendant need not, and thus mandates a 
procedural course for federal employees that differs from 
the one made available to their private sector counter­
parts. In conjunction with the Equal Employment Oppor­
tunity Commission (EEOC or Commission), federal agen­
cies are obligated to develop and implement plans to 
achieve equal employment opportunity. EEOC regula­
tions require federal agencies to create an elaborate 
administrative mechanism for the processing of discrim­
ination complaints, which includes procedures for investi­
gations and hearings at agency expense. 29 C.F.R. 
1613.211-1613.222. A federal worker who believes that he 
has been the victim of discrimination must first bring his 
complaint to the employing agency (42 U.S.C. 
2000e-16(b)), an obligation that the Court has character­
ized as a “rigorous administrative exhaustion 
requirement[]” (Brown, 425 U.S. at 833). The employee is 
entitled to a hearing before an administrative law judge 
selected by the EEOC (29 C.F.R. 1613.218); the 
examiner’s decision is binding on the agency unless re­
jected within 30 days (29 C.F.R. 1613.220(d)).

If he receives an adverse decision there, the employee 
may either appeal to the EEOC or bring an action in 
district court against “the head of the department, agency, 
or unit at which he is employed.” 42 U.S.C. 2000e~16(c). If 
the employee chooses to appeal to the EEOC, the Com­
mission’s decision is binding upon the agency, generally 
without recourse to judicial review, although the employee 
may seek de novo review of an adverse decision. 29 C.F.R. 
1613.281; see Chandler v. Roudehush, 425 U.S. 840 
(1976). The employee also may file a civil action if, after 
having chosen to pursue an administrative appeal, the



9

EEOC rejects his claim or takes no action on it within 180 
days. 42 U.S.C. 2000e-16(c). See generally Brown, 425 
U.S. at 832.

In contrast, an employee in the private sector brings his 
complaint of discrimination not to his employer but 
directly to the EEOC, which (if it finds the complaint 
meritorious) attempts to obtain relief on the employee’s 
behalf by means of conference and persuasion (see 42 
U.S.C. 2000e-5(a)). If the EEOC is unable to obtain ade­
quate relief by informal means, it does not (as in the 
federal sector) take action that is binding on the employer; 
instead, it may bring suit on the employee’s behalf (42 
U.S.C. 2000e-5(f)). If the Commission rejects a com­
plaint, the employee may bring a civil action of his own 
(ibid.).2

The differences between Section 717 and the private sec­
tor Title VII remedy extend beyond procedure. Because it 
“provides for a careful blend of administrative and 
judicial enforcement powers,” Section 717 is the exclusive 
antidiscrimination remedy for federal employees (Brown, 
425 U.S. at 833); Title VII has no such preemptive effect 
for employees in the private sector. And Section 717 does 
not, of course, provide for interest as part of the backpay 
remedy, as Title VII does in private sector actions. See 
Shaw, slip op. 12.

B. Congress Has Included The Postal Service In The Federal Sec­
tor For Purposes of Title VII Litigation

There is no dispute that petitioner’s cause of action has 
properly —and necessarily— proceeded under Section 717,

2 These differences between public and private sector procedures 
w'ere even more dramatic at the time of the enactment of Section 717. 
Then, entirely different agencies were given responsibility for redress­
ing discrimination in the public and private sectors; while the EEOC 
acted in the private sector, the Civil Service Commission oversaw im­
plementation of Title VII in federal employment. It was not until 1978 
that the EEOC assumed the antidiscrimination functions of the Civil 
Service Commission. See 42 U.S.C. 2000e-4 note.



10

rather than under the provisions of Title VII governing 
private sector defendants (see Pet. Br. 2). Liability under 
Title VII was expresly extended to the Postal Service by 
Section 717, the federal sector provision. 42 U.S.C. 
§ 2000e-16(a). Indeed, when Congress created the Postal 
Service in 1970, it specifically considered and rejected the 
suggestion that USPS be covered by the then-existing pro­
visions of Title VII relating to the private sector. On the 
Senate floor, Senator Cook proposed an amendment to 
the Postal Reorganization Act that would have extended 
Title VII to the Postal Service; the amendment passed the 
Senate by a 93-0 vote. See 116 Cong. Rec. 22279-22280 
(1970). But the Cook amendment was deleted in con­
ference because of “adamant” opposition from the House 
(see id. at 26955 (remarks of Sen. Cook)).

The conferees acted after receiving assurances from the 
Civil Service Commission that, “[sjince the new Postal 
Service would be in the Executive Branch of the Govern­
ment and Executive Order 11478 [guaranteeing non­
discrimination in the federal service] applies to the Ex­
ecutive Branch, employees of the new Postal Service 
would continue to have coverage under the Executive 
Order” (id. at 26955 (remarks of Sen. Cook) (emphasis 
omitted)). Both Houses of Congress therefore acted with 
the expectation that Postal Service employees would be 
covered by the same statutory and administrative anti- 
discrimination provisions that applied to other federal 
workers, provisions that the conferees understood to “af­
ford!] much more protection to the person who is com­
plaining” than did Title VII (id. at 27597 (remarks of Rep. 
Daniels)). See id. at 26953, 26956, 26957 (remarks of Sen. 
McGee); id. at 27607 (remarks of Rep. Udall).3

3 It was explained on the floor that 5 U.S.C. 7151 (since recodified 
at 5 U.S.C. 7201, see Pub. L. No. 95-454, § 703(a)(1), 92 Stat. 1216), 
which sets out the basic antidiscrimination policy for federal



11

C. Section 717 of Title VII, Not Section 401(1) of the Postal 
Reorganization Act, is the Source of the Waiver of Sovereign 
Immunity in This Case

In 1970, when Congress included the Section 401(1) “sue 
and be sued” clause in the Postal Reorganization Act, it 
thus specifically chose not to make the Postal Service 
liable under Title VII. When Congress lifted the govern­
ment’s immunity from suit under Title VII two years later, 
it did so on a government-wide basis, in a broad but 
precisely-defined way. It is that second waiver that makes 
this suit possible, and that sets out in precise terms the 
nature of the action as to which sovereign immunity was 
being waived. It is therefore the scope of the Section 717 
waiver, which concededly does not extend to awards of in­
terest, that is controlling here. Cf. Lehman v. Nakshian, 
453 U.S. 156, 160-161 (1981); United States v. Test an, 424 
U.S. 392, 399 (1976). As the court of appeals explained 
(Pet. App. A3-A4), the fact that Congress previously had 
made the Postal Service amenable to other types of 
lawsuits by enacting Section 401(1) is a fortuity that has no 
application in this case. Cf. Shaw, slip op. 9.

Petitioner, of course, offers a different view of the 
statutory structure. Under his analysis of the case (Pet. Br. 
18-19, 30-31), Section 717 creates the cause of action for 
federal employment discrimination and Section 401(1) 
provides the waiver of sovereign immunity that permits

employees, would apply to the Postal Service. See 116 Cong. Rec. 
27607 (1970) (remarks of Rep. Udall). At the same time, Congressmen 
evidently recognized that Exec. Order No. 11,478, 3 C.F.R. 803 
(1966-1970 comp.), would have to be amended to cover the new Postal 
Service. See ibid, (remarks of Rep. Udall); id. at 26955 (remarks of 
Rep. Cook). Senator McGee, floor manager for the bill that became 
the Postal Reorganization Act, explained that if antidiscrimination 
remedies provided by Executive Order 11478 proved inadequate, “this 
body would proceed at once * * * to legislate appropriately without 
delay” (116 Cong. Rec. 26957 (1970) (remarks of Sen. McGee)).



12

the Title VII cause of action to be asserted against the 
Postal Service, just as, for example, a state garnishment 
statute might create a cause of action against all employers 
that is made applicable to the Postal Service by Section 
401(1). See Franchise Tax Board, 467 U.S. at 519. But in 
the circumstances of this case, petitioner’s attempt to 
separate the cause of action from the waiver of immunity 
ignores the way in which Congress chose to make the 
United States liable for employment discrimination.

When Congress excepted the federal government from 
the Title VII definition of “employer” in 1964, it explicitly 
preserved the sovereign immunity of federal employers in 
Title VII suits. The creation of a Title VII cause of action 
against the government in 1972, which for the first time 
made federal entities (including the Postal Service) 
amenable to process and liable for damages in employ­
ment discrimination cases, was expressly intended to waive 
that immunity. See S. Rep. 92-415, 91st Cong., 1st Sess. 
16 (1971). See generally H.R. Rep. 92-238, 92d Cong., 2d 
Sess. 25 (1971); 118 Cong. Rec. 4922 (1972) (remarks of 
Sen. Williams); id. at 4929 (remarks of Sen. Cranston); 
Brown, 425 U.S. at 827-828. It is thus the terms of this 
1972 waiver —a waiver effected by creation of a cause of 
action, the scope of which is coterminous with that cause 
of action —that establish the “limitations and conditions 
upon which the Government [has] consented] to be sued.” 
Soriano v. United States, 352 U.S. 270, 276 (1957).4

Indeed, Sections 717 and 401(1) in terms authorize suits 
against different entities. Section 717(c) waives the govern­
ment’s immunity in Title VII suits agains “the head of the

4 Petitioner’s misunderstanding evidently stems from his belief that, 
“had Congress not expressly in the Postal Reorganization Act 
exempted the Postal Service from Title VII, then under the liberal con­



13

[plaintiff’s] department, agency, or unit,” and petitioner’s 
action in fact proceeded against the Postmaster General. 
Section 401(1), in contrast, makes the Postal Service 
amenable to suit “in its official name.” This difference has 
real significance. Failure to name the agency head (rather 
than the agency) as defendant in a Title VII action may 
lead to dismissal of the case. See, e.g., McGuinness v. 
USPS, 744 F.2d 1318, 1322-1323 (7th Cir. 1984) (alter­
native holding); Cooper v. USPS, 34 Fair Empl. Prac. 
Cas. (BNA) 985 (S.D. Cal. 1983), aff’d, 740 F.2d 714, 716 
(9th Cir. 1984), cert, denied, 471 U.S. 1022 (1985); Canino 
v. EEOC, 707 F.2d 468, 472 (11th Cir. 1983); Newboldv. 
USPS, 614 F.2d 46, 47 (5th Cir.), cert, denied, 449 U.S. 
878 (1980); Davis v. Califano, 613 F.2d 957, 958 n. 1 (D.C. 
Cir. 1979); Morgan v. USPS, 798 F.2d 1162, 1165 n.3 (8th 
Cir. 1986) (Rehabilitation Act), cert, denied, No. 86-5979 
(Mar. 30, 1987); Ellis v. USPS, 784 F.2d 835, 838 (7th Cir. 
1986) (Age Discrimination in Employment Act). Con­

struction rule [relating to the interpretation of “sue and be sued 
clauses], the Postal Service would have been liable under Title VII 
back in 1970” (Pet. Br. 31). In fact, however, the Postal Reorganiza­
tion Act did not expressly exempt USPS from, or indeed make any 
reference to, Title VII. It is Title VII itself that preserved the sovereign 
immunity of all federal entities in employment discrimination suits by 
excepting the United States from the definition of “employer.” 
Similarly, petitioner asserts that the court of appeals read Section 717 
to “reinstate sovereign immunity to the Postal Service with respect to 
prejudgment interest” (Pet. Br. 19). But sovereign immunity could not 
have been reinstated in 1972 because it had not yet been waived in 
Title VII actions. As the court of appeals explained, “[u]ntil Congress 
some two years after passing the Postal Reorganization Act amended 
Title VII to extend it to the federal sector with additional provisions 
applicable only to that sector, there had been no congressional waiver, 
presumptive or otherwise, of the Postal Service’s immunity to Title 
VII actions” (Pet. App. A5). Petitioner thus fails to recognize that 
Section 717 was an initial, and limited, waiver of immunity.



14

versely, courts have explained that suits proceeding under 
Section 401(1) must be directed at the Postal Service itself 
(and not at the Postmaster General or other Postal Service 
officials), although they have declined to dismiss im­
properly captioned actions in the absence of an objection 
from the Postal Service. See National Ass’n o f Postal 
Supervisors v. USPS, 602 F.2d 420, 422-423 n.l (D.C. Cir. 
1979); Ass’n o f American Publishers, Inc. v. Governors o f 
the USPS, 485 F.2d 678, 111 (D.C. Cir. 1973).5

While this distinction between Sections 717 and 401(1) is 
technical, it plainly shows that the statutes create distinct 
waivers of sovereign immunity that operate in different 
types of lawsuits. Section 401(1) makes the Postal Service 
itself “ ‘amenable to judicial process’ ” (Franchise Tax 
Board, 467 U.S. at 518 (citation omitted); see id. at 525). 
But a Title VII action may proceed only against the 
Postmaster General; in effect, as the court of appeals 
observed, “the Postal Service is amenable to process in a 
Title VII case only under the federal sector provisions of 
Title VII. It follows that the scope of [petitioner’s] remedy 
must be determined by reference to the federal sector pro­
visions of Title VII, and not b[y] reference to the sue-and- 
be-sued clause of the Postal Reorganization Act.” Pet. 
App. A5.

5 In Federal Housing Administration v. Burr, 309 U.S. 242, 249-250 
(1940), the Court concluded that a statute “authoriz[ing] suits by or 
against the Administrator [of the Federal Housing Administration] ‘in 
his official capacity’ ” permitted actions against the Administration 
itself. The Court reasoned that “[t]he Administrator acts for and on 
behalf of the Federal Housing Administration, since by the express 
terms of the Act all the powers of the latter ‘shall be exercised’ by 
him.” That is not true of the Postal Service; a number of powers are 
specifically vested in the Postal Governors and may not be delegated 
to the Postmaster General, the Postal Service’s chief executive officer. 
See 39 U.S.C. 202, 203, 402.



15

This analysis hardly means, as petitioner asserts (Pet. 
Br. 30), either that the “sue and be sued” clause in Section 
401(1) lacks prospective effect or that Congress must 
specifically apply to the Postal Service every cause of ac­
tion that it creates in the future. Whenever Congress 
creates a cause of action that may be asserted against com­
mercial entities generally, that action may (absent indica­
tions of contrary congressional intent) be asserted against 
federal entities that are subject to “sue and be sued” 
clauses. But that is not the case here. Section 717 created a 
special remedy, with special procedures and limitations, 
that applies only to federal defendants; it was passed to 
waive the blanket immunity from employment discrimina­
tion suits that had been carefully preserved at the time of 
Title VII’s original enactment in 1964. It therefore must be 
understood as a threshold waiver of immunity. See Shaw, 
slip op. 12.

Petitioner’s lengthy discussion of the proper, liberal in­
terpretation of “sue and be sued” clauses accordingly is 
beside the point, because Section 401(1) has no application 
here. And as Shaw established (and petitioners concede), 
Section 717 —the source of the waiver that defines the 
scope of the government’s liability in this case —does not 
waive the government’s sovereign immunity against 
awards of interest.

D. The Remedy Created By Section 717 Does Not Provide For 
Awards Of Interest

1. The background and structure of Title VII and the 
Postal Reorganization Act also compel a related but 
distinct conclusion: even if Section 401(1) somehow is 
deemed the provision that provides the waiver of immuni­
ty in this case, Postal Service employees are accorded their 
cause o f action by Section 717. Section 401(1) (assuming 
that it is relevant here at all) simply makes the Postal Serv­
ice amenable to process. The scope of the available 
recovery is spelled out by the statute providing the cause of



\6

action. And here, that statute —Section 717 —does not 
provide for awards of interest.

In thus crafting a defined set of procedures and 
remedies that were made the exclusive avenue of relief 
from employment discrimination by the Postal Service 
and other federal sector defendants, Congress delimited 
the general authority to sue and be sued by the terms of the 
remedy that it created.6 Had Congress in terms stated that 
prejudgment interest is unavailable in actions under Sec­
tion 717, there could be no question about the outcome of 
this case. The fact that the “no-interest” rule is not made 
explicit in the statute, but rather is a conclusion drawm by 
this Court in Shaw from the absence of language clearly 
addressing the issue, does not make the rule any less 
binding.

2. a. Petitioner nevertheless disputes this seemingly 
self-evident proposition. Pointing to Section 401(1) and 
listing the attributes that the Postal Service shares with 
private corporations (Pet. Br. 21-24), petitioner argues 
that Congress intended USPS to “operate as a private 
commercial enterprise” (Pet. Br.) and therefore maintains 
that it would be inconsistent with the goals of the Postal 
Reorganization Act to treat Postal Service employees like

6 This is hardly a novel conclusion. Courts have used the same 
reasoning in resolving tort claims against the Postal Service. Congress 
specifically provided in the Postal Reorganization Act that the Federal 
Tort Claims Act (FTCA) “shall apply to tort claims arising out of ac­
tivities of the Postal Service” (39 U.S.C. 409(c)). See also 28 U.S.C. 
2679(a). Notwithstanding Section 401(1), then, the courts have 
uniformly held that persons suing the Postal Service in tort must pro­
ceed under, and are subject to the limitations of, the FTCA. See In­
surance Co. o f North America v. USPS, 675 F.2d 756, 758 (5th Cir. 
1982); Contemporary Mission v. USPS, 648 F.2d 97, 104-105 n.9 (2d 
Cir. 1981); Sportique Fashions, Inc. v. Sullivan, 597 F.2d 664, 
665-666 n.2 (9th Cir. 1979). Section 717, as a comprehensive and ex­
clusive remedy for use against federal defendants, operates in the 
same way to define the scope of the relief available against the Postal 
Service in employment discrimination cases.



17

their federal sector counterparts for purposes of Title VII. 
But even if petitioner’s argument could be reconciled with 
this Court’s interpretation of Section 717 in Shaw, his bald 
assertion about the mission and organization of the Postal 
Service disregards the careful choices Congress made in 
providing that, in many ways, the Postal Service should 
continue to operate as a traditional federal agency. In par­
ticular, petitioner’s analysis ignores the clear indications 
that, in creating a dichotomy between public and private 
sector Title VII interest awards, Congress would have ex­
pected awards against the Postal Service to fall on the 
public side of the line.

To be sure, the words “sue and be sued,” as applied to 
the Postal Service in Section 401(1), “ ‘in their normal con­
notation embrace all legal process incident to the com­
mencement and continuation of legal proceedings’ ” 
{Franchise Tax Board, 467 U.S. at 517 (citation omitted)). 
The liability of the Postal Service is thus presumptively 
equivalent to that of a private entity when it operates in a 
commercial capacity (see id. at 518).7 At the same time, 
however, “waiver of sovereign immunity is accomplished 
not by ‘a ritualistic formula’; rather intent to waive im­

7 As petitioner recognizes (Pet. Br. 16-17), the Court has taken this 
approach-looking to the general policy behind the congressional 
scheme —only in cases involving federal instrumentalities that are 
covered by a “sue and be sued” clause and that have been'“ ‘launched
* * * * into the commercial world’ ” (Franchise Tax Board, 467 U.S. at 
518, (quoting Federal Housing Administration v. Burr, 309 U.S. 242, 
245 (1940)). See Reconstruction Finance Corp. v. J.G. Menihan 
Corp., 312 U.S. 81, 84 (1941). In other cases involving waivers of im­
munity, the Court consistently has emphasized that it will “construe 
waivers strictly in favor of the sovereign, see McMahon v. United 
States, 342 U.S. 25, 27 (1951), and not enlarge the waiver “ ‘beyond 
what the language requires,’ ” Ruckelshaus v. Sierra Club, 463 U.S. 
680, 685-686 (1983), quoting Eastern Transportation Co. v. United 
States, 272 U.S. 675, 686 (1927)” (Shaw, slip op. 7). Compare id. at 
1-2 (Brennan, J., dissenting).



18

munity and the scope of such a waiver can only be ascer­
tained by reference to underlying congressional policy” 
(id. at 521). A “sue and be sued” clause therefore does not 
effect a complete waiver when that result would be incon­
sistent “ ‘with the statutory or constitutional scheme’ ” (id. 
at 517-518 (citation omitted)).8 And here —where Con­
gress explicitly refrained from treating the Postal Service 
as a private corporation for purposes of Title VII liability, 
instead creating a discrete Title VII remedy for all federal 
employees —Congress plainly did not subject the Postal 
Service to suit on the same terms as are applicable to a 
private entity.9

8 Courts therefore have concluded that “sue and be sued” clauses do 
not function as complete waivers of sovereign immunity in a variety of 
settings, as petitioner himself recognizes (Pet. Br. 13-14 & n.7). See, 
e.g., A .L.T. Corp. v. SBA, 823 F.2d 126, 128 (5th Cir. 1987); Hillv. 
National Flood Ins. Program (In re Estate o f  Lee), 812 F.2d 253, 256 
(5th Cir. 1987); R & R Farm Enterprises v. Federal Crop Insurance 
Corp., 788 F.2d 1148, 1152-1153 (5th Cir. 1986); Merced Production 
Credit Ass’n v. Sparkman (In re Sparkman), 703 F.2d 1097, 1101 (9th 
Cir. 1983); Painter v. TVA, 476 F.2d 943, 944 (5th Cir. 1973). Cf. 
Florida Dep’t o f Health & Rehabilitative Services v. Florida Nursing 
Home Ass’n, 450 U.S. 147, 149-150 (1981) (“sue and be sued” clause 
does not waive state’s Eleventh Amendment immunity).

9 For this reason, petitioner’s lengthy argument that the liability of 
the Postal Service must be precisely equivalent to that of a private cor­
poration (Pet. Br. 21-30) —and his related reliance on decisions inter­
preting “sue and be sued” clauses as they bear on the commercial ac­
tivities of federal entities (Pet. Br. 7-15) —is without merit. The deci­
sions cited by petitioner are premised on the proposition that the 
federal entity had been “ ‘launched * * * into the commercial world’ ” 
(Franchise Tax Board, 467 U.S. at 520 (citation omitted)). See Shaw, 
slip op. 7 n.5 (federal entity “cast off the cloak of sovereignty and 
assumed the status of a private commercial enterprise”); Standard Oil 
Co. v. United States, 267 U.S. 76, 79 (1925). Compare United States 
v. Worley, 281 U.S. 339, 343-344 (1930). But none of those cases in­
volved a situation, such as the one here, where Congress sharply dif­
ferentiated between federal and private sector defendants and explicit­
ly placed the entity subject to the “sue and be sued” clause on the



19

b. In fact, Congress plainly viewed postal workers as 
federal employees.10 It is true, as petitioner notes (Pet. Br. 
23), that Postal Service labor relations (which are

federal side of the line. That Congress took such a step here plainly 
shows that it viewed the relationship between the Postal Service and its 
e oyees to have a governmental, rather than a private and commer­
cial, nature.

10 Outside the employment context as well, Congress has given the 
Postal Service-which is, after all, an “independent establishment of 
the executive branch of the Government of the United States” (39 
U.S.C. 201) —a wide range of powers and attributes that are not 
shared by any private entity. The Postal Service exercises the power of 
eminent domain “in the name of the United States” (39 U.S.C. 
401(9)), promulgates regulations and publishes them in the Code of 
Federal Regulations (39 U.S.C. 401(2)), investigates criminal offenses 
and enforces certain federal laws (39 U.S.C. 404(7), 410(b)(2), 603, 
3003), levies fines (39 U.S.C. 5206, 5403, 5604), enters into interna­
tional agreements (39 U.S.C. 407, 408), has special cooperative ar­
rangements with other federal agencies (39 U.S.C. 411), and receives 
some measure of protection from private competition in its operations 
(39 U.S.C. 601).

Further, while the Postal Service is generally excepted from laws 
governing other federal agencies (39 U.S.C. 410(a)), it is specifically 
treated-both in the Postal Reorganization Act and in subsequently- 
enacted statutes-as a federal agency for purposes of tort claims (39 
U.S.C. 409(c)), service of process and rules of procedure (39 U.S.C. 
409(b)), the Freedom of Information Act, 5 U.S.C. 552 (39 U.S.C. 
410(b)(1)), the National Environmental Policy Act of 1969 (see 
Chelsea Neighborhood Ass’ns v. USPS, 516 F.2d 378 (2d Cir. 1975)), 
the Program Fraud Civil Remedies Act of 1986 (31 U.S.C. 
3801(a)(1)(D)), the Contract Disputes Act of 1978, 41 U.S.C. (& 
Supp. Ill) 601 etseq. (41 U.S.C. 601(2)), the Government in the Sun­
shine Act, 5 U.S.C. 552b (39 U.S.C. 410(b)(1)), and a variety of provi­
sions relating to government contracts and operations (39 U.S.C. 
410(b)(4) and (5)), including, among others, the Miller Act, 40 U.S.C. 
(& Supp. Ill) 270a et seq. (39 U.S.C. 410(b)(4)(B)); the Davis-Bacon 
Act, 40 U.S.C. 276a et seq. (39 U.S.C. 410(b)(4)(C)), the Contract 
Work Hours Standards Act, 40 U.S.C. (& Supp. Ill) 327 et seq. (39 
U.S.C. 410(b)(4)(E)), the Government Losses in Shipment Act, 40 
U.S.C. 721 etseq. (39 U.S.C. 410(b)(4)(F)); the Walsh-Healey Act, 41 
U.S.C. (& Supp. Ill) 35 et seq. (39 U.S.C. 410(b)(5)(A)); and the



20

regulated by Chapter 12 of Title 39, 39 U.S.C. 1201 et 
seq.) are generally modeled on those in the private 
sector.11 But the public law rights and obligations of 
Postal Service employees (set out in Chapter 10 of Title 39, 
39 U.S.C. 1001 et seq., and elsewhere in the U.S. Code) 
are generally identical to those of other federal workers. 
Postal Service employees, as members of the postal career 
service, thus are “a part of the civil service” (39 U.S.C. 
1001(b)), participate in the Civil Service Retirement 
System, 5 U.S.C. 8301 et seq. (39 U.S.C. 1005(d)), are 
covered by the Federal Employees’ Compensation Act, 5 
U.S.C. 8101 et seq. (39 U.S.C. 1005(c)), and are eligible to 
transfer to any other position in the executive branch for 
which they are qualified (39 U.S.C. 1006). They are en­
titled to veterans’ preferences (39 U.S.C. 1005(a)(2)), and 
“preference eligible” Postal Service employees must be 
provided the procedural protections of the Civil Service 
Reform Act of 1978, 5 U.S.C. 7501 et seq.] all other 
Postal Service employees receive those protections unless

Service Contract Act of 1965, 41 U.S.C. 351 et seq. (39 U.S.C. 
410(b)(5)(B)). Like other federal agencies, the Postal Service is 
obligated to implement the requirements of Title VI of the Civil Rights 
Act of 1964, 42 U.S.C. 2000d et seq. (39 U.S.C. 410(b)(6)), and USPS 
buildings, like other public structures, must be designed to accom­
modate the handicapped, 42 U.S.C. 4151 et seq. (39 U.S.C. 
410(b)(8)). Indeed, even some of the Postal Service’s attributes dis­
cussed by petitioner do not have any private sector analogue. Thus, 
while the structure of USPS generally mirrors that of a private cor­
poration (see Pet. Br. 21), the Postal Service’s governing board is ap­
pointed by the President with the advice and consent of the Senate (39 
U.S.C. (Supp. Ill) 202(a)). While postal funds are segregated, they re­
main a part of the United States Treasury (39 U.S.C. 2003(a)). And 
the Postal Service’s budget is submitted to the Office of Management 
and Budget and is transmitted to Congress by the President as part of 
the federal budget (39 U.S.C. 2009).

11 Chapter 12 thus provides for collective bargaining (see 39 U.S.C. 
1206) and applies most of the provisions of the National Labor Rela­
tions Act to the Postal Service (see 39 U.S.C. 1209).



21

collective bargaining agreements provide otherwise (see 39 
U.S.C. 1005(a)(1) and (2)).12 And like other federal 
employees, Postal Service workers may not strike, 5 
U.S.C. 7311, 3333 (39 U.S.C. 410(b)(1)).13

In addition, Postal Service employees are subject to the 
same suitability, security, and conduct regulations as other 
federal workers, Chapter 73 of Title 5, 5 U.S.C. (& Supp. 
Ill) 7301 et seq. (39 U.S.C. 410(b)(1)), and are restricted 
by the same nepotism rules, 5 U.S.C. 3110 (39 U.S.C. 
410(b)(1)). They are subject to federal withholding and 
dual pay provisions, 5 U.S.C. 5520, 5532 (39 U.S.C. 
410(b)(1)). They are protected by the public sector provi­
sions of the Occupational Safety and Health Act of 1970, 
29 U.S.C. 688 (39 U.S.C. 410(b)(7)); like other federal

12 Similarly, Congress recently gave postal supervisors and other 
Postal Service managerial employees the right to appeal adverse ac­
tions to the Merit Systems Protection Board. H.R. 348, 100th Cong., 
1st Sess., 133 Cong. Rec. H6978 (daily ed. Aug. 3, 1987). See also 5 
U.S.C. (Supp. Ill) 5734 (providing reimbursement for travel expenses 
of Postal Service employees who transfer to other agencies). Interest is 
not available on backpay awarded by the Merit Systems Protection 
Board under the provisions of the Civil Service Reform Act of 1978. 
Frazier v. USPS, 790 F.2d 873, 874 (Fed. Cir. 1986).

13 Both petitioner (Pet. Br. 20-22) and amicus NAACP Legal 
Defense and Educational Fund, Inc. (Br. 28) rely on 39 U.S.C. 101(c) 
in arguing that Congress intended Postal Service and private sector 
employees to receive equivalent treatment. That provision provides 
that the Postal Service should “achieve and maintain compensation 
for its officers and employees comparable to the rates and types of 
compensation paid in the private sector of the economy of the United 
States.” In fact, however, the policy of Congress is that a //“[f]ederal 
pay rates be comparable with private enterprise pay rates for the same 
levels of work” (Federal Pay Comparability Act of 1970, 5 U.S.C. 
5301(a)(3)), although the President is authorized to depart trom that 
standard if “national emergency or economic conditions affecting the 
general welfare” make it appropriate to do so. 5 U.S.C. 5305(c)(1). 
See H.R. Rep. 98-425, 98th Cong., 2d Sess. 5 (1984). The policy ex­
pressed in 39 U.S.C. 101(c) therefore plainly does not distinguish 
Postal Service employees from other federal workers.



22

employees, they are guaranteed the right to petition Con­
gress, 5 U.S.C. 7211 (39 U.S.C. 410(b)(1)), and are subject 
to the Debt Collection Act of 1982 (5 U.S.C. 5514 
(a)(4)(B)). And Postal Service employees must swear or af­
firm their support for the Constitution before entering 
upon their duties (39 U.S.C. 1011). During debate on the 
Postal Reorganization Act, Congressmen accordingly ex­
plained that “employees of the U.S. Postal Service * * * 
would be Federal employees just like their counterparts in 
[the Department of] State, [the Department of Defense] or 
the Veterans’ Administration” (116 Cong. Rec. 19849 
(1970) (remarks of Rep. Mize)), and repeatedly referred to 
Postal Service workers as “Federal employees” or “govern­
ment employees.” See, e.g., id. at 19847 (remarks of Rep. 
Flenderson); id. at 19852 (remarks of Rep. Hanley); id. at 
22340 (remarks of Sen. Fong); id. at 22344 (remarks of 
Sen. Allen). See generally id. at 22334 (remarks of Sen. 
Ervin) (“it is absurd to say that we are dealing here with a 
relationship similar to that between a private employer 
and his employees”) .14

c. Of particular importance here, Congress consistent­
ly has treated Postal Service workers like their counter­
parts at other federal agencies for purposes of equal 
employment opportunity.15 As we explain above, at the 
time of the creation of the Postal Service, Congress ex­
pressly chose to exclude Postal Service employees from

14 But cf. 116 Cong. Rec. 22309 (1970) (remarks of Sens. Javits and 
Case) (Postal Service employees have similarities to private sector 
workers for purposes of labor-management relations).

15 Similar action has been taken in areas other than Title VII: the 
Postal Service also is treated as a federal employer under the Age 
Discrimination in Employment Act of 1967 (29 U.S.C. 633a) and the 
Rehabilitation Act of 1973 (29 U.S.C. (Supp. Ill) 791(b), 
792(a)(l)(B)(x)). See also 5 U.S.C. 3102 (providing for assistance for 
the handicapped), made applicable to the Postal Service by 39 U.S.C. 
410(b)(1).



23

Title VII; Congress instead applied the existing federal sec­
tor antidiscrimination provisions to USPS. And when 
Congress extended Title VII to federal employees in 1972, 
it treated the Postal Service in a manner identical to the 
way in which it regulated other federal agencies. Thus, 
Postal Service employees use the same Title VII adminis­
trative procedures as do other federal workers. And the 
lower federal courts have been unanimous in holding that 
Section 717 serves as the exclusive remedy for Postal Serv­
ice employees alleging employment discrimination-as it 
does for other federal, but not private sector, workers.16

Postal Service employees therefore were treated by Con­
gress identically to other federal workers for Title VII pur­
poses. They proceed under a federal sector provision, 
using federal sector procedures, against a precisely- 
defined federal sector defendant; they are foreclosed from 
using remedies that were withheld from other federal 
employees but are available to workers in the private sec­
tor. In this setting, it is hardly likely that Congress in­
tended “to place postal employees in a better position than 
all other federal employees with respect to prejudgment in­
terest in Title VII cases” (Cross, 733 F.2d at 1330). To the 
contrary, such a conclusion “ ‘would impute to Congress a 
desire for incoherence in a body of affiliated enactments 
and for a drastic legal differentiation where policy justifies 
none’ ” (Franchise Tax Board, 467 U.S. at 524 (citation 
omitted))!

‘6 New bold v. USPS, 614 F.2d 46, 47 (5th Cir.), cert, denied, 449 
U.S. 878 (1980); Jacobs v. Bolger, 587 F. Supp. 374, 375 n.l (W.D. 
La. 1984), affd, 759 F.2d 20 (5th Cir. 1985); Quillen v. USPS, 564 F. 
Supp. 314 (E.D. Mich. 1983); Cooper v. USPS, 34 Fair Empl. Prac. 
Cas. (BNA) 985 (S.D. Cal. 1983), affd, 740 F.2d 714 (9th Cir. 1984), 
cert, denied, 471 U.S. 1022 (1985); Kings. Bailor, 444 F. Supp. 1093, 
1094 n.2 (S.D.N.Y. 1978); Tufts v. USPS, 431 F. Supp. 484, 487 
(N.D. Ohio 1976). See Nagy v. USPS, 773 F.2d 1190, 1192 (11th Cir. 
1985) (“Section 717 is the exclusive remedy for a Postal Service 
employee alleging illegal discrimination.”); Jarrell v. USPS, 753 F.2d 
1088, 1091 (D.C. Cir. 1985) (“Title VII is the exclusive remedy.”).



24

CONCLUSION

The judgment of the court of appeals should be af­
firmed.

Respectfully submitted.

Charles Fried 
Solicitor General

Donald B. Ayer 
Deputy Solicitor General

Charles A. Rothfeld 
Assistant to the Solicitor General

John F. Daly 
A ttorney

Louis A. Cox 
General Counsel

Stephen E. Alpern 
Associate General Counsel

Kevin Rachel 
Senior Attorney 
United States Postal Service

October 1987



APPENDIX

39 U.S.C. 401(1) provides:
The Postal Service shall have the following general 
powers:

(1) to sue and be sued in its official name[.]
42 U.S.C. 2000e-16 provides:

(a) Discriminatory practices prohibited; employees or ap­
plicants for employment subject to coverage

All personnel actions affecting employees or 
applicants for employment (except with regard to 
aliens employed outside the limits of the United 
States) in military departments as defined in sec­
tion 102 of title 5, in executive agencies as defined 
in section 105 of title 5 (including employees and 
applicants for employment who are paid from 
nonappropriated funds), in the United States 
Postal Service and the Postal Rate Commission, 
in those units of the Government of the District 
of Columbia having positions in the competitive 
service, and in those units of the legislative and 
judicial branches of the Federal Government hav­
ing positions in the competitive service, and in the 
Library of Congress shall be made free from any 
discrimination based on race, color, religion, sex, 
or national origin.

(b) Equal Employment Opportunity Commission; enforce­
ment powers; issuance of rules, regulations, etc.; annual 
review and approval of national and regional equal 
employment opportunity plans; review and evaluation of 
equal employment opportunity programs and publication 
of progress reports; consultations with interested parties; 
compliance with rules, regulations, etc.; contents of na­
tional and regional equal employment opportunity plans; 
authority of Librarian of Congress

Except as otherwise provided in this subsec­
tion, the Equal Employment Opportunity Com-

(la)



2a

mission shall have authority to enforce the provi­
sions of subsection (a) of this section through ap­
propriate remedies, including reinstatement or 
hiring of employees with or without back pay, as 
will effectuate the policies of this section, and 
shall issue such rules, regulations, orders and in­
structions as it deems necessary and appropriate 
to carry out its responsibilities under this section. 
The Equal Employment Opportunity Commis­
sion shall—

(1) be responsible for the annual review and ap­
proval of a national and regional equal employ­
ment opportunity plan which each department 
and agency and each appropriate unit referred to 
in subsection (a) of this section shall submit in 
order to maintain an affirmative program of 
equal employment opportunity for all such 
employees and applicants for employment;

(2) be responsible for the review and evaluation 
of the operation of all agency equal employment 
opportunity programs, periodically obtaining 
and publishing (on at least a semi-annual basis) 
progress reports from each such department, 
agency, or unit; and

(3) consult with and solicit the recommenda­
tions of interested individuals, groups, and 
organizations relating to equal employment op­
portunity.
The head of each such department, agency, or 
unit shall comply with such rules, regulations, 
orders, and instructions which shall include a 
provision that an employee or applicant for 
employment shall be notified of any final action 
taken on any complaint of discrimination filed by 
him thereunder. The plan submitted by each



3a

department, agency, and unit shall include, but 
not be limited to —

(1) provision for the establishment of training 
and education programs designed to provide a 
maximum opportunity for employees to advance 
so as to perform at their highest potential; and

(2) a description of the qualifications in terms 
of training and experience relating to equal 
employment opportunity for the principal and 
operating officials of each such department, 
agency, or unit responsible for carrying out the 
equal employment opportunity program and of 
the allocation of personnel and resources pro­
posed by such department, agency, or unit to 
carry out its equal employment opportunity pro­
gram.
With respect to employment in the Library of 
Congress, authorities granted in this subsection 
to the Equal Employment Opportunity Commis­
sion shall be exercised by the Librarian of Con­
gress.

(c) Civil action by employee or applicant for employment for 
redress of grievances; time for bringing of action; head of 
department, agency, or unit as defendant

Within thirty days of receipt of notice of final 
action taken by a department, agency, or unit 
referred to in subsection (a) of this section, or by 
the Equal Employment Opportunity Commission 
upon an appeal from a decision or order of such 
department, agency, or unit on a complaint of 
discrimination based on race, color, religion, sex 
or national origin, brought pursuant to subsec­
tion (a) of this section, Executive Order 11478 or 
any succeeding Executive orders, or after one



4 a

hundred and eighty days from the filing of the 
initial charge with the department, agency, or 
unit or with the Equal Employment Opportunity 
Commission on appeal from a decision or order 
of such department, agency, or unit until such 
time as final action may be taken by a depart­
ment, agency, or unit, an employee or applicant 
for employment, if aggrieved by the final disposi­
tion of his complaint, or by the failure to take 
final action on his complaint, may file a civil ac­
tion as provided in section 2000e-5 of this title, in 
which civil action the head of the department, 
agency, or unit, as appropriate, shall be the 
defendant.

(d) Section 2000e-5(f) through (k) of this title applicable to civil 
actions

The provisions of section 2000e-5(f) through 
(k) of this title, as applicable, shall govern civil 
actions brought hereunder.

(e) Government agency or official not relieved of responsibili­
ty to assure nondiscrimination in employment or equal 
employment opportunity

Nothing contained in this Act shall relieve any 
Government agency or official of its or his 
primary responsibility to assure nondiscrimina­
tion in employment as required by the Constitu­
tion and statutes or of its or his responsibilities 
under Executive Order 11478 relating to equal 
employment opportunity in the Federal Govern­
ment.

U S. GOVERNMENT PRINTING OFFICE: 1987-202-037/60058