GENERAL ELECTRIC CO. v. GILBERT

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Argument of Theophil C. Kammholz

Chief Justice Warren E. Burger: We’ll here arguments next in 1589, General Electric Company against Martha Gilbert.

Mr. Kammholz, I think you may proceed whenever you are ready.

Mr. Theophil C. Kammholz: Mr. Chief Justice, may it please the court.

The issue here on reargument as it was the issue last January, is whether the exclusion of pregnancy related disabilities from an employer’s Disability Income Protection Plan is violative of the effects proscription of Title VII of the Civil Rights Act.

General Electric in its comprehensive insurance program has an Income Protection Plan in affect since prior to 1950 which provides benefits to employees who on account of sickness or accident nonoccupational incurred are absent from work.

The benefits continue for a maximum of 26 weeks and commence on the eighth day in the event of sickness first day in the even of accident, the maximum the 60% of earnings with a saving of $150 per week.

This plan incidentally dovetails with a long term disability plan for the catastrophic kind of accident or illness.

The plan excludes pregnancy related disabilities and the reasons, the historical reasons therefore and which apply today can be summarized in this fashion.

Sickness and accident involves the unforeseen, the unexpected.

Pregnancy basically is a planned event, neither sickness nor accident.

At General Electric, the return rate of employees absent because of sickness or illness is in the 90% plus percentile except for pregnancy where the return rate is about 40%.

So, in essence to provide this kind of disability payment for pregnancy disability would be providing a kind of severance pay to women only.

Additionally and the statistics are basically the same at General Electric as across the land under insurance plans, the cost of SNA coverage for females on the industrial theme where the exclusion of pregnancy related disability runs about a 170% of male cause or to put in another way, for everyone $100 expended for male SNA coverage a $170 is expended for female coverage.

If as the undisputed actuarial testimony of the trial indicates.

If this pregnancy exclusion were extended to six weeks coverage, the percentage total will run about 210% or $210 expended for every female on the average is contrasted with the male and if there were unlimited sealing on pregnancy disability coverage, the total would run between 300% and 330%.

Again at trail the undisputed testimony indicated, that to strike down, the kind of elimination that we’re talking about here would add annually to the plans currently and affecting the country $1 billion and 353 million in cost.

Unknown Speaker: But you have to understand the unlimited coverage for pregnancy disability to be.

Mr. Theophil C. Kammholz: No sealing as contrasted with any other sickness or illness.

Under GE for example, 26 weeks of coverage.

Unknown Speaker: Well, that’s not unlimited, that’s limited to 26 weeks.

Mr. Theophil C. Kammholz: Perhaps the characterization is inaccurate, but it would be in the same category as other benefits under the plan.

Currently the coverage of SNA applies to perhaps 40% of the American industrial workforce according to the record and we are talking only about those plans because there is no requirement that General Electric or any other employer impose a plan with or without pregnancy disability.

Now, of the 40% plan coverage the record again demonstrates that only 40% of those plans, 40% of the 40% provide some kind of maternity, pregnancy disability coverage and all goes to without exception the sealing on it is six weeks.

Now, if the EOC is right in this situation, that six week sealing falls by the wayside, there can be no distinction as to total amount available and this is one of the difficult cost implications that give rise to deep concern.

In the insurance industry practice with respect to individual insurance policies, SNA policies is a very simple one, it excludes pregnancy related disabilities.

On the simple theory, that if such an individual plan were available to females, the insurance would be procured after marriage or when a pregnancy was planned and this would obliterate the underlying concept of what insurance in this area is all about, protect against the unforeseen, the unplanned, the unexpected.

Unknown Speaker: Mr. Kammholz, let me be sure about this?

The insurance industry then excludes all pregnancy related disabilities, even those that are complication of normal pregnancy, is that what you are saying?

Mr. Theophil C. Kammholz: Under individual policies.

Yes.

With respect to group coverage this is not the case Your Honor, there are as I noted the 40% of the policies in effect provide some kind of pregnancy disability coverage; the general standard is six weeks.

Unknown Speaker: Is there any other medical condition that is generally eliminated?

Mr. Theophil C. Kammholz: Generally speaking, no.

It is a practical matter and I don’t want to do come with record here with a cosmetic surgery for example, where there is no coverage under the GE policy with respect to the hospital, surgical aspect of it.

Unknown Speaker: There is no coverage under GE policy for cosmetic surgery.

Mr. Theophil C. Kammholz: For cosmetic surgery as far as hospital, medical expense is concerned, there’s coverage for the in and out of the hospital but with respect to cosmetic surgery this runs a day to two, the heavy cost is what the physicians charge, the surgeons charge in that regard.

The decision for exclusion of this kind of coverage is as I noted, further buckers by the unique nature of pregnancy.

Essentially it’s a voluntary thing as the record gain points out without dispute and this is an expert for union testified, it would be a strange commentary indeed if the survival of the human race depended upon sickness.

Contraception in the society which New York Times recently characterized, is one having reached almost a 100% level of contracepted control of birth, is such that it’s the plan pregnancy that almost invariably applies.

To equate then, the pregnancy related situation with sickness and accident generally would be a non-secretors and now we come to Geduldig v. Aiello, this courts decision in 1974 in the California insurance case where under the Fourteenth Amendment.

The court held that pregnancy is unique and that there was invoked not a situation of dissimilar treatment, a person similarly situated but rather the dealing with a unique situation a sui generous situation pregnancy with respect to which there can be no discrimination these are the males.

I should like to comeback to Geduldig in a moment, I would like to touch now on why we are here, whether the Congress in 1964 in the enactment of the Civil Rights Act contemplated, the obliteration of this kind of exclusion.

Your Honor is recall, I am sure that the sex proscription surface for the first time in the House of Representatives.

The day before the house adopted Title VII.

Ironically the sex amendment came about as the result of the proposal by representative Howard Smith of Virginia who was an opponent of the Civil Rights Act and finally all of the male representatives who voted for the sex amendment ultimately voted against Title VII.

The legislative history is very sparse indeed as a Fifth Circuit pointed out in Willingham and if I may, I think I can put him focus more precisely the point I am trying to make here by giving this quote, last year Willingham in a sex plus case a hair-length case the court said, “We find the legislative history regarding sex discrimination in conclusive at best” and may I say this appears at page 13 of our supplemental brief dated September 15, 1976.

We find the legislative history regarding sex discrimination inconclusive with best and drop at one conclusion and that by way of negative inference, without more extensive consideration congress and all probability did not intend for its proscription of sexual discrimination to have significant and sweeping implications.

We should not therefore extend the coverage of the act to situations of questionable application without some stronger congressional mandate.

Upon the adoption of Title VII, the Equal Employment Opportunity Commission beginning in 1965 and continuing for six-and-one-half years articulated the precise view that we are espousing here this morning.

The view that because pregnancy is different, the prescriptions of Title VII on the sex subject, we are not intended to reach pregnancy exclusions.

Now, I submit to that contemporaneous interpretation by EEOC should be given great wait and the change which occurred in 1972 with 180 degree reversal in the agency abuse should be ignored to put it another way, we suggest that they were right in the first place.

Unknown Speaker: Mr. Kammholz.

Mr. Theophil C. Kammholz: Yes Your Honor.

Unknown Speaker: Would there by any impediment that you can suggest to having the collective bargaining agreement between the parties, General Electric and its bargaining agents provide for all these things explicitly another which are giving the respondents everything seeking in this litigation.

Mr. Theophil C. Kammholz: No indeed not, the parties could so bargain indeed is, I am sure you will here from my distinguished opponent.

The union has asked for such a change during the course of bargaining over the years and the union of course has asked for many other things their demands have been innovative, to say the least.

Now I think clearly this is a matter for collective bargaining, the parties elect to distribute a larger portion of the benefit dollar to this area, they could so do, but this would be on the basis of consideration as to what is appropriate in terms of dividing the benefit dollar.

If I may return briefly now to Geduldig v. Aiello, Footnote 20 in that decision which articulates the sui generous nature of pregnancy and pregnancy related disabilities.

This is been a subject of great deal of consideration and writing not only by the courts but in the Law Schools and very recently also Arthur Larson a former Under Secretary of Commerce and now against be Duke Professor of Law at Duke University has published book not available at the time but the original argument in which he expresses -- I think expresses very subsequently, the consideration that are involved here, as he puts it a Supreme Court adoption of the EEOC rule, would on the strength of a statute aimed and not at social or private insurance reform but at employment discrimination change all this, rearrange insurance priorities in categories and markedly order the allocation of the limited resources available for wage loss, hospital and medical benefits.

A way from both the creators and the beneficiaries of those plans, very often the view is suggested that in smoke-filled rooms decisions are made which discriminate.

The fact of the matter is in collective bargaining and in decision making on the part of management in an organized operations; what is the appropriate allocation of the benefit dollar indeed the, how does one divide the pie if you will in terms of the fringe benefits, wage increases, cost of living adjustment, etcetera.

These decisions are arrived at in this sector as a result of careful consideration, no effort at discrimination but a desire to do what is best for the largest number and Professor Larson points out the ultimate decision here, the non-extension of pregnancy benefits to women really relates to the family unit.

There is a father for every child, the head of the household perhaps and it is the allocation of that money to apply for the greatest benefits for all involved, it is the underlying decision and because the family unit is in the majority obviously any decision that can be characterized discriminatory.

Unknown Speaker: Mr. Kammholz, does the collective bargaining representative of the entire workforce have a position on how this money should be distributed?

Mr. Theophil C. Kammholz: No, this is hammered out on a case by case, contract by contract basis.

Unknown Speaker: Haven’t they have made a demand that these benefits be included?

Mr. Theophil C. Kammholz: In this incidence, in this case?

Unknown Speaker: Well is not that the position of a union?

Mr. Theophil C. Kammholz: Oh, sure this demand has been made over the years, along with many other demands as I noted the union is most likely --

Unknown Speaker: Aren't they the one who are most directly interested in the proper allocation throughout the workforce.

Mr. Theophil C. Kammholz: They have participated in these decisions because ultimately the panoply what is asked for is so broad and all encompassing, it is what is finally hammered out is what really counts and with respect to what is finally hammered out the union signature is on the line.

Unknown Speaker: That seems to me the argument you are making was that what you are doing is for the benefit of the workforce as a whole but…

Mr. Theophil C. Kammholz: Precisely.

Unknown Speaker: But the union takes the contrary position.

Mr. Theophil C. Kammholz: I might have add finally that under the Equal Pay Act and under Executive Order 11246, the rule of the EEOC here ascribes for is not recognized, equal contributions under benefit plans are surprise and may I note again that with respect to pregnancy disability, it is not only a matter of equal contributions but the amount that goes to females very substantially exceeds that which is available to males.

Unknown Speaker: If the collective bargaining agreement provided for larger contributions from women employees based on actuarial studies, would that violate any federal statute or EEO regulation that you know.

In other words it supposed to the effort was to make the people who are benefited bare the cost.

Mr. Theophil C. Kammholz: I suspect the argument would surface very swift that either this was discriminatory, I should add that earlier this year and again not available at the time of the original argument.

The New York State Department of the insurance issued an in depth report on insurance cost, we have logged it with a court, it is available here and it demonstrate several things.

Number one, it supports clearly and precisely the position initially articulated that, female cost is much higher.

This report finds.

It notes also for example that because of the longer life of females on the average, pension cost, annuity cost is run about 25% higher for females and for males.

Thank you very much.

Unknown Speaker: Mr. Kammholz, you have not mentioned an innovating decisions since you last argued here, Washington against Davis.

Mr. Theophil C. Kammholz: Yes Your Honor.

Unknown Speaker: I wanted what you have to say about that.

Mr. Theophil C. Kammholz: Washington v. Davis was a race case.

Unknown Speaker: But the statute treats race satisfies the same.

Mr. Theophil C. Kammholz: But this court has never held sex as a suspect classification.

Unknown Speaker: No, but I am talking about this as a statutory case has been.

Mr. Theophil C. Kammholz: Yes, we think that Footnote 20 clearly points out that there is no sex discrimination in our case.

Therefore the reach of Washington v. Davis simply could not apply and again I know we suggest as I am sure is in the minds of Your Honors the proposition that sex is not inherently suspect.

Unknown Speaker: But that really does not have much do with this statutory.

Mr. Theophil C. Kammholz: It does not if you agree with our initial concept, there is no discrimination involved.

Thank you.

Unknown Speaker: Gentlemen before you sit down let me ask you to help me a little bit.

Could a plan such as GEs exclude generally Sickle cell anemia?

Mr. Theophil C. Kammholz: I think Sickle cell anemia would be in a different category from what I know about the medical writings on this subject.

This is a disease suffered only by blacks.

Unknown Speaker: Could it exclude such a disease as Pemphigus, which as I understand that is more observant among Jewish people and others.

Mr. Theophil C. Kammholz: I am not familiar with that one but I think the same answer would apply.

Unknown Speaker: Could it exclude circumcision?

Mr. Theophil C. Kammholz: Oh, I think it could.

Unknown Speaker: It put that in a same category as pregnancy.

Mr. Theophil C. Kammholz: I will give the short answer, yes.

Unknown Speaker: Mr. Kammholz, I did not hear the answer, could you telling, what was you answer with respect to Sickle cell anemia.

You said it was a disease that can only be separate by blacks.

Mr. Theophil C. Kammholz: By blacks.

Unknown Speaker: But therefore it could be excluded or could it not…

Mr. Theophil C. Kammholz: Could not.

Unknown Speaker: Could not be excluded.

But why do you have come to different conclusion on pregnancy which can only be separated by…

Mr. Theophil C. Kammholz: Because we are dealing on the one hand with race and on the other with sex.

Unknown Speaker: But does the statute draw different mean sex discrimination and race discrimination?

Mr. Theophil C. Kammholz: The court has, Your Honor...

Unknown Speaker: In Statutory cases sex to be a suspect classification.

But those are constitutional cases, under the statute it is…

Mr. Theophil C. Kammholz: In the light of legislative history, Title VII I suggest the identical rules should apply.

Unknown Speaker: So is it, one is an illness, the other is not.

Mr. Theophil C. Kammholz: Yes.

Unknown Speaker: That is what you told us.

Mr. Theophil C. Kammholz: That is the underlying position that its childbirth pregnancy is a natural thing, medical testimony on the record indicated that in most instances, it contributes to the well being of the mother, its not a disease as Dr. Hilger pointed out because it would be said indeed, if we all survived on the basis of sickness, it is a sui generous unique, different onto itself kind of condition.

Thank you.

Unknown Speaker: One last question, who has the burden of proof in your definition?

Mr. Theophil C. Kammholz: In my view we have -- there is no prima facie burden.

We establish a rational relationship, we establish the sex aspect of it and there is no burden approve on us.

Unknown Speaker: Very well Mr. Kammholz. Ms. Weyand.

Argument of Ruth Weyand

Ms Ruth Weyand: Mr. Chief Justice, may it please the Court.

I want to address myself first to the question which has been raised as to the relationship of collective bargaining to the issue of inclusion or exclusion.

This Court, as a matter of law, has recognized in cases involving a collective bargaining agreements, which discriminate because of race as far way before the enactment of Title VII that in Steele v. Louisville & Nashville that union sometime do under in discriminatory contracts and if they violate their constitutional duty when they do so.

More recently under Title VII, Title VII is directed at the fact that both of them regards to race and sex.

Many unions have not and dealing with employers acted in a nondiscriminatory matter and the existence of a collective bargaining agreement is no excuse.

Furthermore as the record here shows, since the time that fringe benefits became by law a bargaining subject with the Inman (ph) v. NLRB decision of the Seventh Circuit in 1948 with affirmed on another point here.

Next bargaining session, the first one with the IUE between GE and the IUE was in 1950, the record here shows with that dispute at 1950, the union point it out, the General Motors paid six weeks which is usually enough to take care of it in fact with changing medical practices, many other women get back in less time, we have two first witness in our case.

From Tyler, Texas was certified back in four weeks, GE would not take her back, Mary Williams went back in four weeks, another witness here six weeks and my estimation on cost is not the companies that now pay six weeks if they begin letting employees comeback when they are physically certified back, they are going to have a reduction in cost not the increase in cost.

But the IUE went to the employer.

1950, 1955, 1960, 1963, 1966 repeatedly and asked if they bargain and included the six weeks benefit which is traditional, which is present in 40% of the industry in fact daily the companies actuary, I think is that a 60% of the industry pay six weeks benefits.

Unknown Speaker: Ms. Weyand, would you consider that a six week benefit would comply with the statute if all other illnesses had a benefited up to 26 weeks.

Ms Ruth Weyand: No, I do not, we have cases, I have pending case against GE, I just want to say cost wise.

Unknown Speaker: They would not have solved their problems.

Ms Ruth Weyand: They would not because, we think that the individual who has a complication, she really has a disease, no question illness, she needs the more and that it is discriminatory to limit this one area, the six weeks no question about it but I was just saying in terms of the union’s effort here over the years to get something for these women, and they union has wanted to spend, the union of course in the last rounds of negotiations is asked that it be treated the exactly the same you have record here that there be no limit whatsoever that it, not only go on for 26 weeks, but it go on under the permanent.

We have the IUE is a plaintiff has suit against General Motors involving the six weeks time which I mention is in has file and had finding to that is discriminatory.

But I just wanted to say if the union has tried to get this and there is an assumption that it seems to be employed in some peoples minds that the union asks for something like this, the company is going to willing to give it and that this demands was on the bargaining table during the long strike.

There are certain things companies have principles about, GE had a principal about job posting for years and years, it has recently changed because of Title VII they brought a new plant had a job posting agreement, we had a 15 week strike when they took it out that plant.

GE has a principle about not paying sickness and acts and benefits, now it pays for everything and I am afraid the record, the answer to the question may not have made it clear it pays for the time that a man is disable by cosmetic surgery.

Mr. Kammholz was nearly making the point; they do not pay the medical expense so any.

There is not a single thing that a man gets disabled by that GE does not cover fully, but GE and it appears in this record with the testimony and the testimony insurance, it is firmly other view that when you pay disability benefits for pregnancy, you are not paying for the period a woman is disabled, its figures are not based on the period it is disable, this court upset a statute that has a six weeks, the Turner versus Utah, it had a six weeks returns date as against.

We all know the people are able to comeback earlier then that and the Cleveland versus LaFleur, you are agreed they can back in.

Unknown Speaker: But that allow them government.

Ms Ruth Weyand: Government, but you took judicial notice to the fact that many women are not physically disabled for six weeks and GE has never pretended here, there are doctor, the medical testimony, there doctor, Dr. Hellegers, Dr. Forest, no dispute, that most women, in fact the numerical majority come out the hospital in two or three days now and within two weeks their doctor, Dr. Wilbury (ph) said 11 days for, in terms of tired time or the time she went to labour until she was back on the job.

Testimony of both their doctor -- now two weeks today is the majority of women are back at home doing their homework, taking care of the children which is harder work from job in the office.

That the medical position has changed and I have cited the point but the reason there actuary when he figures this billion, he figures that every women under a 13 week plan is going to be out 13 weeks.

Every women under 26 week plan is going to be out 23 weeks, every women under a 52 weeks is going to be out 30 weeks and he says why not because they are disable, they have a never made a pretenses because of disable because women malinger, they are there -- and you will find in the finding here, that court found they do not malinger but their actuary explain insurance position of why this is it not covered by insurance, is that women have a natural desire to take it easy.

They may have heard to someone had a miscarriage and therefore they are going to want to sit at home and they have a natural desire after the child is born to stay home with it.

Now if you knew these women, that have to have that paycheck, they do not want to sit home, they want a babysitter their who establishes the routine the day they come back and they want that check to pay it because it got it get back.

There are 37 million women working in the United States today and it is the figures, Department of Labor as of April, the last figures came out in July of 1976 for the quarter ending April 1975, 21 million women either were single, divorced, widowed or had husband who made less than $7000.

Also one out of ten babies is born to a women who is single, divorced or widow.

One out of ten babies, this is a the largest poor group in this country are the women, the figures in here with imple justice.

These women, this matter of Sheryl Stein (ph) here, when she did not have her check, had go on welfare, her light, or heat was turned up.

One of the plaintiff you testify without dispute, she lived in a country area, she had to walk two miles with a two-year-old daughter, her husband had left her to get food because she got on welfare, she waited the birth of a child to unlighted, un-eated health and GE is a stereotype.

Well they did not think anything what happened, the record showed she was a married women, in their view she has a husband who is going to take care of it.

The testimony here on the amount of time that women are going to be off and why GE does not pay this is that women are going to malinger and abuse it.

Their whole figure is on the cost, now if you take the six weeks which sister Mr. Belly says that the record that shows that he said that 60% of the women are covered for six weeks and another one under actuary figured how much it cost to cover the women in this country for six weeks.

He said, he deducted the amount of a present cost based on it and he deducted cost $225 million to cover 60% of the women for six weeks which is what is covered.

It will only cost $150 million for every company in United States to make up that other 40%.

If 60% cost $225 million another 40% is only a $115 million and that is in six week.

The figures GE based on and GEs positions at the bargaining table is that the women want to stay home and they are going to malinger and that has never tried to count out.

He refused the figure, we asked for figures on how many his record are women returning, it refused the find them, it did not provide it, never provided any figure on its return rate, the number of weeks or days that women were out, it did and I think there was a slight statement, I am sure Mr. Kammholz did not mean to state, that there was a return rate of 40%, the return rate is 60% at GE on their figures on, there is no dispute in the record.

GE and its objection seem derogatory why it did not want to provide me the figures I wanted on the expense pregnancy so on.

You know 40% turnover rate for males and females, 40% turnover each year, now with that turnover rate, the fact that 40% of the women can come back is no different then the man may have come back from a injury or something, or sickness but he is not going to be late before there are anymore chance that he will weeks, months later than these but GE and many companies have this position and they get a position that women are going to maligner.

Now it may be this is because and they have no evidence on it, they (Inaudible) their actuary why when explains in the whole insurance business, they do not covered them in individual policies based on the affected women are going to want to stay home before and after they are going to maligner, this is an abuse.

Is they are not subject to the same controls but occurred in case of a man and man would not stay out when he is sick or injured because he wants a merit increase, he wants a promotion, he is going to get back as fast as he should, but this does not work with women.

This is straight sex stereotyping right down the line, the straight stereotyping is that we were not concerned about Sheryl Stein because the record shows she was married, it is a stereotype that is contrary to the fact United States has being existent life today and it goes much further than merely pregnancy because this attitude shakes the practices of the companies.

The payment of sickness enacts that benefits the American industry does not serve as benefit welfare system entirely, GE did not put it in with that in mind, put it in because this whole sickness actually says we get productivity, people are not going to worry about what is going to happen to them in the future.

This is part of compensation, it says and it uses this as a control lever on when a person goes out and when they comeback, 60% of their wages a man, a women who have their budget geared and these are not high pay, they are the figures of the time here, we got the figures here on the hourly rate it was 6000 a year for a women, 7000 or 8000 for a man on the average.

Now, a lot of them get less than even females marry to GE males, you have trouble raising your family and making a budget on these kind of figures today.

They work just a last minute until the drop the men that even have a sang, because they got it, they do not want a 60%, they want a 100% and they get back as soon as they can and supervisor does not want to put them out if they can find anything else for them to do.

The Chairman of our GE Board broke an arm and I was asking about, do they put people on light work Oh, yes I was tool and die maker they did not say send me home on sickness and they had me answering a phone, they find late light work from, they have not found light work for women, they send them home without any pay, there is not to disincentive to the management to send a person home if they have to pay sickness and accidents benefits.

They want to send women home as soon as they begin to show.

The court below I must say, it is said the Title VII intended that employment relations be sexblind as well as colorblind and while there has been remarks about how sex got into the Title VII, here in 1972 when Congress, for the first time, provided enforcement powers it said that sex discrimination is of the same concern as race discrimination and the courts have agreed that there is no difference between the two.

I have a promise to say so I will divide my time with the Assistant Attorney General.

I do want to ask leave to file a supplemental brief because Friday, I was served with the Reply Brief which very, very seriously mistakes the record in a number of respects and I do not have time at the oral argument to answre them I will go of course limited to just put incorrect to the record and with the permission of the Court I would like to ask leave.

Unknown Speaker: You may respond to the Reply Brief.

Ms Ruth Weyand: Thank you.

Unknown Speaker: Ms. Weyand, let me ask you a question.

You are asking to file another brief; you have already filed two, haven’t you?

250 pages total, do you expect that we can absorb the energy that you like us to?

Ms Ruth Weyand: I am very much regret that but that’s going to be limited to answering inaccurate facts which was stated in the reply brief which I do think this court should be put straight on several inaccuracy.

I regret the length of the brief--

Unknown Speaker: Are you going to file another 100 pages?

Ms Ruth Weyand: Oh no, it will be 5 to 10 pages, I can assure you.

It is just going to answer, but straight and accurate facts I don’t again to re brief another.

Unknown Speaker: Let me ask you another question then.

Our rule as the brief says a concise statement of the case yet you have 61 pages of fax.

Ms Ruth Weyand: I regret that you have not found the brief helpful.

The problem is that if I may make a little bit of an excuse that this is the first case which this court has dealt with anything like this aspect of Title VII.

It was a case of first impression in the lower courts.

After we develop the law you can focus.

Now, the points which I have not dealt with here that are very important but because it is new, we have not focused.

We have four Courts of Appeals now gone our way and 18 district judges but each one of them emphasized what’s that completely different.

Now, the courts below, here the finding of the EEOC was that there is an impact, the EEOC finding set out in the back of the petition for certiorari; there is an impact on this class because of the nine in coverage.

The Court of Appeals here emphasized all women as a class; lose compensation because they would have to buy their own as a class.

They did not focus on an individual woman who was pregnant.

They said all women were denied compensation, and two or three of the other courts posted (Inaudible) on all women denied compensation.

That at first looks at the irrelevance of the difference between the disabilities they pay for and the ones they don’t.

Uniformly, the courts have held that cost is completely irrelevant and we think it is here.

I am sorry.

Unknown Speaker: Very well Ms. Weyand.

Mr. Attorney General.

Argument of J. Stanley Pottinger

J. Stanley Pottinger: Mr. Chief Justice and may it --

Unknown Speaker: Mr. Pottinger, do you interpret our rule to permit in a case like this that government would argue amicus without an order of the court.

J. Stanley Pottinger: Your Honor, I have not addressed the rules specifically.

It was my understanding that we were permitted to argue amicus and by letter to the clerk and the court we are grated that permission.

Unknown Speaker: I am just wondering if -- is that the government’s interpretation of the rule?

J. Stanley Pottinger: Certainly it is, if not by direction by indirection, yes sir.

Mr. Chief Justice may it please the court.

What we have presented today is the following fact situation against which Title VII must be measured.

We have a disability plan by General Electric which seeks to cover virtually all disabilities for men and women except one.

A great deal has been said about the voluntariness of pregnancy.

Let us examine for a moment however the coverage of voluntary as well as involuntary disabilities for men virtually every disability including voluntary disabilities as they affect men are covered by this plan that includes everything from cosmetic surgery as noted to suicide to felonies or the results of felonies to voluntary sports activities to falling of ladders.

Unknown Speaker: Of course, now that’s covered for women too.

J. Stanley Pottinger: Yes it is.

There is no distinction in other words as to voluntariness or involuntariness in this plan with the exception and therefore I think to say that the plan is misdirected toward voluntariness of pregnancy is purely misleading.

The purpose of Title VII however is to provide equal opportunity in the job market by excluding in various forms of discrimination including sex and we believe that given the legislative history and interpretations of the court, clearly two different theories would sustain a prima facie case of sex discrimination in this case.

First, the exclusion in this particular case is not neutral on its face.

It does single out a condition which is so inextricably sex-linked to women that it is tantamount to a policy of excluding women from this otherwise total coverage.

Unknown Speaker: How Can you say that in light of the Geduldig case?

I never knew how to pronounce the respondent Aiello?

J. Stanley Pottinger: I have been calling Geduldig v Aiello.

I am not sure that’s right either.

We are on Footnote 20, Your Honor.

Unknown Speaker: Not alone Footnote 20; the whole judgment and the opinion.

J. Stanley Pottinger: Because that was based on a Fourteenth Amendment theory not on a statutory theory, we think that that’s persuasive distinction and that this court itself is recognized in Washington v. Davis.

Unknown Speaker: What actuarial elements of important factor in that holding?

J. Stanley Pottinger: Yes, definitely.

I would like to address that same issue in this case if I may.

The actuarial issue in Aiello however was set in the context of estate social welfare program where the court found that it was rational.

Unknown Speaker: That case held that the pregnancy exclusion was not on sex discriminations.

Now that’s what this statute forbids, it is sex discrimination.

Aiello said it that was not one, now what’s it--

J. Stanley Pottinger: I believe that Aiello said that under those circumstances it was rational to conclude that it was not sex discrimination.

Yet under Title VII, this court also found in a very similar situation that it is rational under Griggs.

The Griggs case made it clear that if there is an impact, the consequences, predictable consequences of a policy of exclusion, if it falls on a protected class, here women, does cost (Voice Overlap)

Unknown Speaker: Well Griggs was talking about testing; it was not talking about this type of thing.

J. Stanley Pottinger: No, I believe that it was talking more broadly, was it not about--

Unknown Speaker: The holding of Griggs dealt with testing.

J. Stanley Pottinger: The holding did but (Voice Overlap) and with race Griggs has been cited however as president both for sex cases in as in your question and more broadly it has been properly cited as president for any device or selection activity or exclusion activity not just from hiring but device or employment device or standard or criteria, which excludes or has an adverse impact on a protected class.

I think it goes beyond hiring.

Unknown Speaker: When you properly cited then you mean that it’s proper to cite a case for something other than its holding?

J. Stanley Pottinger: I think that this holding does apply beyond the issue of hiring; it is what I am saying.

Unknown Speaker: But it is not a holding then.

J. Stanley Pottinger: Well, I understand that the facts make the holding applicable in that case to hiring but the principle stated by the court in Griggs clearly goes to the issue of what constituted discrimination in hiring.

Unknown Speaker: There is nothing about impact or effect in the statute, is it there?

J. Stanley Pottinger: There is not.

Unknown Speaker: The only place that appears is a gloss that’s put on the statute or the way the statute is construed by the EEOC and by this court in Griggs.

J. Stanley Pottinger: Well, that’s correct and a progeny of Griggs however, I would not characterize it as only a gloss; it seems to me that both EEOC practice, administrative guidelines and the deference that we pay to those and this courts decision in Griggs are also--

Unknown Speaker: Is the EEOC authorized to issue regulation?

J. Stanley Pottinger: Yes it is.

Unknown Speaker: And not just guidelines?

J. Stanley Pottinger: Pardon me, guidelines in this particular case.

However, the court has held that deference should be paid to the guidelines and we think that that is sensible.

Either under a theory which would state that there is an inextricable relationship between race and the exclusionary factor or sex in the exclusionary factor, for instance, sickle cell anemia or under the impact theory of Griggs.

In either case, prima facie case has been made out.

Now, I notice the counselor concedes before you today that if sickle cell anemia were before the court that could not be excluded, I would submit that there is no logical or rational distinction under Title VII not under Aiello, not under the Fourteenth Amendment but under Title VII between an exclusion of sickle cell anemia, which we admit could not lawfully take place and the exclusion of sex related practices or disabilities such as pregnancy, I fail to see the distinction.

Therefore, we are faced with only two defenses or rather arguments in defense.

One is Aiello which we have just – I have attempted the deal with here.

The other is the business necessity or cost factor and if I may I would like to point out that in this particular case, cost cannot be a controlling factor in this decision.

First of all, in the courts below General Electric refused to present a business necessity defense either in the District Court or in the Court of Appeals.

It presented cost factors not for purposes of showing that the cost would be too high and indeed the admission that 40% of those industries that do provide these benefits have not gone broke, have not shut down their plans.

It seems to me to give the light to the theory that it ever could be too high.

So the business necessity defense is not even presented to the court. However, it comes in the back door right now it seems to me by arguing in this fashion by raising the horrors of cost.

Yet clearly we do not need to find at this program in order to be sustained, must provide a cost that would literally shut down the plant.

That is not an issue; it’s a red herring here.

As for the notion that the six weeks coverage would have to be extended clearly what we are talking about and what counsel for –- appellate is talking about is a coverage that arises from sickness or involuntary disability arising after in normal pregnancy.

No one is suggesting, and not is the counsel for General Electric suggesting that there would be up to 26 weeks of benefits for a normal pregnancy.

Yet under the General Electric plan even an involuntary illness, an unpredictable illness that is pregnancy related would not be covered at all much less would have been covered on a basis that is similar to that which men have under the disability program.

They are excluding both the voluntary, if you will, aspects of pregnancy and the normal aspects and the involuntary or abnormal aspects of pregnancy alike.

Yet it presents no cost figures whatsoever on how often abnormalities will arise and how much they would cost, instead it refers to industry wide figures that we would submit or in opposite to the problems faced by GE or indeed by the 40% of companies that have done this successfully.

There are ways, in fact, dealing with the cost issue.

The courts have held that cost itself is not a defense to discrimination where a case is made out and we agree with that and we also agree that the cost factors could be raised only in the event that a business necessity defense could be raised and again that is not either been tendered before this court this morning or in either of the courts below despite ample opportunity to do so.

What we are faced with is a situation where General Electric has provided, has such provide an umbrella of coverage and yet it has plucked out one single activity from that umbrella and placed it in the rain.

What we are talking about here is an activity which is not or rather a disability which is not been shown to be more expansive, for instance, than one that males face and indeed the record will indicate that in the insurance area as opposed to disability coverage, men in GE costs to the company much more than women.

The insurance program cost them more if we were to find that respiratory diseases or heart disease or other specific diseases were actuarially defined and the company wanted to take those into account to keep the integrity of cost factors at a minimum, that would be another issue but that is not what they propose to do in this case.

We believe that once the company undertakes as General Electric has to create a broad umbrella of coverage.

Unknown Speaker: Mr. Attorney General, when you said men cost more, did you mean in the life insurance program as oppose to medical?

J. Stanley Pottinger: That is correct.

However, I think that counsel’s use of the 170% figure is itself a bid of a red herring.

The male coverage figures that he presents are not related directly to the cost factors that would arise in GE on a comparative basis with pregnancy that was normally judged as opposed to this 26 or open ended judgment.

Unknown Speaker: But your basic position is that the cost really doesn’t make any difference anyway?

J. Stanley Pottinger: No, I think the cost could make a difference but clearly in this case, it does not make a difference and has not --

Unknown Speaker: When would cost make a difference?

J. Stanley Pottinger: I would use the (Inaudible) Test that states that in a business necessity way, if the safety or efficiency of the company were at stake--

Unknown Speaker: But it was a matter of bankrupting the company and if a business necessity defenses interposed.

J. Stanley Pottinger: And if it was interposed which it was not interposed in this case even though—

Unknown Speaker: What’s the statutory basis for business necessity defense?

J. Stanley Pottinger: As I believe it is 703 (g) or (j) I believe.

The statute allows for what amounts to a business necessity result or rather argument but may I simply say that with regard to the cost factor, the business necessity defense itself makes clear that only if it’s necessary to -- only if the one cost interposed is necessary and would result in disabling of the company, would this factor arise.

Here, there are other ways in which the company could cover normal and even abnormal pregnancies without the necessity for eliminating this entire program.

It could, for instance, reduce the amount of payments, elsewhere it could, for instance, eliminate coverage that runs across sex line such as respiratory diseases arising from smoking in men and women alike.

It could reduce the amount of payment in terms of the time it pays.

It could take any number of innovative approaches to cover--

Unknown Speaker: How (Voice Overlap) you think those alternative proposals are in the face of the realities of collective bargaining?

If there’s going to be any reduction in the benefits?

J. Stanley Pottinger: Well, I think that in light of as long as this court sits, and as long as this court is able to recognize, it will.

If it does recognize that this form of discrimination, can it go forward, I think they are realistic.

I think in the absence of the rule--

Unknown Speaker: It can’t.

I am talking about the realities of collective bargaining --

Do you think union is going to agree to reduction in the benefits that you already have?

J. Stanley Pottinger: It seems to me that if – yes, I think so, If the company can show that the absence of such a reduction is to close down the plant or otherwise disable the company, I would say that that’s a possibility that’s reasonable and what’s I’m saying further is that is, in fact, in law the only basis upon which the company can go either to court or to the union in the collective bargaining system and say we must make a change in order to accommodate pregnancy disability programs.

In the absence of showing that high standard of need, it seems to me that the chances are not great but on the other hand they need not be great because the company will not be faced with the disabling cost factor.

Unknown Speaker: Thank you.

J. Stanley Pottinger: Thank you.

Unknown Speaker: Mr. Attorney General, Mr. Kammholz.

Rebuttal of Theophil C. Kammholz

Mr. Theophil C. Kammholz: Several very quick comments and I should like to address the observations of counsel regarding what happens with collective bargaining people.

Members of the Court in the real world out there, you do not take it away and the reference is inappropriate.

Secondly, as we note in the supplemental brief dated September 15, 1976, the position of Deputy Solicitor General Lawrence Wallace, when he appeared before you in oral argument in Fitzpatrick v. Bitzer seems rather clearly to embrace the view of Aiello, which we have articulated here this morning.

He says the – well, I’m not going to bore you with reading what we quote but on pages 8 to 9 of this supplemental brief we note what the solicitor’s office says there and I suggest it’s quite different from what we heard here this morning.

Finally, a very brief reference, Mr. Justice Blackmun to sickle cell anemia, this is an area that we have not covered in any of our briefs and I should like to note again that pregnancy is the only physical condition which is unique to one sex and as I understand the sickle cell situation it’s in an opposite because most blacks are immune to it.

Finally it’s sickness as I understand it and not a unique condition like pregnancy.

Thank you very much.

Unknown Speaker: The conditions that are more seen more frequently on one sex than another...

Mr. Theophil C. Kammholz: Yes

Unknown Speaker: It sum to 80 or 90% to 10%, 20% ratio.

Mr. Theophil C. Kammholz: Thank you.

Unknown Speaker: Thank you.

The case is submitted.