City of Los Angeles Department of Water v. Manhart
Headline: Court rules employer sex-based pension contributions unlawful under Title VII, bans higher pension charges for female workers, but limits retroactive refunds to avoid large disruptions to pension funds and administrators.
Holding:
- Makes higher pension contributions for women unlawful under Title VII.
- Limits retroactive refunds to avoid destabilizing pension funds and retirees' benefits.
- Requires employers to adjust pension plans to treat employees equally regardless of sex.
Summary
Background
A municipal utility, the Los Angeles Department of Water and Power, used mortality tables and its own experience to decide that women as a group live longer than men. The Department required its roughly 2,000 female employees to make 14.84% higher monthly pension contributions than comparable men. Monthly retirement benefits for men and women of the same age, service, and salary were equal. A class of women sued in 1973, the District Court ordered refunds for excess contributions, and the Ninth Circuit affirmed. The Department later changed its plan to eliminate sex distinctions effective January 1, 1975.
Reasoning
The Court asked whether treating women differently because of a class-based longevity generalization violated Title VII’s ban on discrimination against individuals. The majority said the statute protects individuals, not class stereotypes. Even if women live longer on average, imposing higher contributions on each woman because of that fact treats each employee differently because of her sex. The Court rejected the Department’s reliance on an Equal Pay Act exception and distinguished earlier cases about pregnancy or disability. It held the contribution scheme violated Title VII.
Real world impact
The ruling means employers cannot require higher employee pension contributions solely because women live longer on average. The Court, however, vacated the broad award of retroactive refunds and remanded the remedy question. The majority expressed concern that large retroactive money orders could harm pension funds, retirees, and third parties and said relief must be fashioned carefully.
Dissents or concurrances
Justices were divided. Justice Marshall would have upheld the full refunds. Chief Justice Burger argued actuarial sex-based tables are reasonable and urged reliance on the Equal Pay Act exception. Other Justices concurred in part.
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