Contractors Ass'n of Eastern Pennsylvania v. Secretary of Labor
442 F.2d 159 (1971)
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Rule of Law:
The President, acting through an Executive Order, has the authority to require contractors on federally assisted projects to implement affirmative action plans that include specific minority hiring goals, as this is a valid exercise of executive power to set the terms of federal procurement and is not prohibited by Title VII of the Civil Rights Act of 1964.
Facts:
- Pursuant to Executive Order No. 11246, which requires federal contractors to take 'affirmative action' against employment discrimination, the U.S. Department of Labor established the Philadelphia Plan.
- The Plan applied to federal and federally assisted construction projects costing over $500,000 in a five-county area around Philadelphia.
- The Department of Labor found significant underrepresentation of minority workers in six skilled construction trades, attributing this to the exclusionary practices of the local craft unions.
- The Plan required bidders on covered projects to submit an affirmative action program that included specific goals for minority manpower utilization, with percentage ranges established by the Department of Labor after public hearings.
- Contractors Association of Eastern Pennsylvania (the Association) and its member contractors (the Contractors) relied on these craft unions' hiring halls as their primary source of labor.
- The General State Authority of Pennsylvania, as a condition of receiving federal funds for a dam construction project, included the Philadelphia Plan's requirements in its invitation for bids.
- The Association and individual Contractors challenged the Plan, arguing it forced them to hire based on a quota system.
Procedural Posture:
- The Contractors Association of Eastern Pennsylvania and individual contractors (plaintiffs) sued federal officials in the U.S. District Court for the Eastern District of Pennsylvania.
- Plaintiffs sought an injunction to prevent the inclusion of the Philadelphia Plan's requirements in bids for federally assisted projects.
- In the district court, plaintiffs moved for summary judgment, while the federal defendants filed a cross-motion for summary judgment and a motion to dismiss.
- The district court dismissed the Association's complaint for lack of standing but found the individual contractors had standing.
- The district court denied the plaintiffs' motion and granted the federal defendants' motion for summary judgment, upholding the Plan's validity.
- The plaintiffs (appellants) appealed the district court's decision to the U.S. Court of Appeals for the Third Circuit.
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Issue:
Does the Philadelphia Plan, an affirmative action program established under Executive Order 11246 that requires bidders on federally assisted construction projects to set specific goals for hiring minority workers, exceed the President's authority or violate Title VII of the Civil Rights Act of 1964 or the Due Process Clause of the Fifth Amendment?
Opinions:
Majority - Gibbons, J.
No. The Philadelphia Plan is a valid exercise of executive authority and does not violate the Civil Rights Act or the Constitution. The President possesses the authority to set the terms and conditions for federal procurement and federally assisted projects to protect federal financial and performance interests. This includes ensuring the largest possible pool of qualified labor is available, which is hindered by discriminatory exclusion. Congress's continued appropriation for such projects with awareness of the Executive Order program implies authorization or at least acquiescence, placing the action within the President's legitimate power under the Youngstown framework. The Plan does not violate Title VII of the Civil Rights Act, as Section 703(j)'s prohibition on requiring preferential treatment is a limitation on Title VII itself, not on other lawful remedies like Executive Orders. The 'affirmative action' mandate is necessarily 'color-conscious' to remedy the effects of past discrimination and does not aim to 'freeze the status quo.' Finally, the Plan does not violate the Due Process Clause; its goals are not impossible quotas but requirements for a good-faith effort to expand the labor pool, which is a legitimate condition for a contractor wishing to receive federal funds.
Analysis:
This case is a landmark decision that validated the concept of federal affirmative action programs. It established that the executive branch could mandate race-conscious remedies to counteract the effects of past discrimination in industries receiving federal funds. The court's distinction between remedial goals and illegal 'quotas' provided a crucial legal foundation for the development of affirmative action policies nationwide. By holding that Title VII's anti-preference provision did not foreclose such remedies under separate executive authority, the decision created a pathway for proactive government measures to address systemic discrimination beyond simply prosecuting individual acts of bias.
