Supreme Court to hear argument in pregnancy discrimination and retirement benefits case

December 4, 1:34 PMWorkplace Law ExaminerMarcia McCormick

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Next Wednesday, the Supreme Court will hear oral argument in AT&T v. Hulteen (the ScotusWiki page with links is here), a case involving pregnancy leave and the calculation of years of service for retirement benefits.

The plaintiffs are women who worked for AT&T and its predecessor, Pacific Bell, who took leave related to pregnancies before 1979, and who retired between 1994 and 2000. Before 1979, the company limited the amount of pregnancy leave that would count towards service for calculating pension benefits, but did not limit the amount of other temporary disability leave that would count for service. In other words, before 1979, the company treated pregnancy leave differently from other temporary disability leave to calculate pension benefits at retirement.

In 1979 the Pregnancy Discrimination Act took effect, prohibiting employers from treating pregnancy leave different from other temporary disability leave, in seniority systems. The PDA did other things, too, but this is the part that matters for this case. The plaintiffs, thus, did not get full service credit for their leaves taken before 1979 and were awarded smaller pensions than if they would have received full credit. The question in this case is whether the decision at the time of these plaintiffs' retirements to calculate their benefits without giving full credit for pregnancy leave taken before 1979 is a violation of Title VII.

There are essentially two issues that the Supreme Court will consider: whether AT&T's calculation was a current violation of Title VII or whether construing Title VII to prohibit an employer from following its pre-PDA rule in calculating service credit is an impermissible retroactive effect. A related issue is when the discrimination (if there is any) occurred, triggering the time to file a charge with the EEOC. Several parties have weighed in as amici on both sides, including the US Solicitor General, which weighed in on the side of the employer, despite the fact that the EEOC agrees with the interpretation of the employees. Law.com has a good article summarizing those arguments.

This case presents some fascinating statutory interpretation and nature of discrimination issues that probably could not arise in another context, all related to when the discrimination actually occurred and what the state of the law was at the time. The discrimination may have occurred when the decision was made to create the policy, it may have occurred at the time the policy was put into effect, it may have occurred when the women took leave, it may have occurred when the PDA went into effect, it may have occurred the first time the women were effected by the seniority system, it may have occurred when the pensions were awarded, or it may have occurred at each of those points. And the meaning of the PDA is somewhat at issue. Some might say that it, for the first time, prohibited discrimination on the basis of pregnancy, and others would argue that it simply made clear that discrimination on the basis of pregnancy was discrimination on the basis of sex which Title VII had prohibited since its enactment.

There are some difficult issues here, but in my view, the case should be affirmed. The point at which the benefit was ultimately calculated was at retirement, and it was at that point AT&T decided not to give full credit for pregnancy leave. The language of Title VII itself makes clear that discrimination occurs "with respect to a seniority system that has been adopted for an intentionally discriminatory purpose . . . when the seniority system is adopted, when an individual becomes subject to the seniority system, or when a person aggrieved is injured by the application of the seniority system or provision of the system." 42 U.S.C. § 2000e-5(e)(2). And a seniority system that intentionally treats pregnancy differently from other temporary disability leave is a system that was adopted for an intentionally discriminatory purpose under the plain language of Title VII.