Court to Rule on Leaves for Pregnancy : Justices Agree to Hear Cal Fed Challenge of California Law

The Supreme Court, in a key case for American business, today agreed to decide whether states may require employers to provide special fringe benefits for pregnant workers.

The justices will study a challenge to a California law requiring employers to grant leaves of absence to pregnant workers who request them--even if leaves are not granted for any other cause.

The law is being attacked as illegal sex discrimination against men and non-pregnant women.

The 1978 California law was challenged by the California Federal Savings and Loan Assn. and other employers whose leave policy did not meet the state law’s requirements.

Four Months’ Leave

The law says employers must provide up to four months’ pregnancy leave and must reinstate the employee in the same job unless “business necessity” makes that impossible.

Cal Fed’s lawyers contend that the state law requires a “special preference” barred by a federal law known as Title VII of the Civil Rights Act of 1964.

Congress amended the federal law in 1978 to make clear that discrimination in employment based on pregnancy also is barred.

The California Department of Fair Employment and Housing filed a complaint against Cal Fed in 1983, alleging that the S&L; failed to reinstate Lillian Garland speedily after she had taken a pregnancy leave.

Company Policy

Cal Fed’s policy is that if an employee’s job, or a similar one, is not available when the employee returns from a leave of absence for any reason, that employee may be fired.

The 9th U.S. Circuit Court of Appeals, rejecting Cal Fed’s appeal, upheld the 1978 California law.

The appeals court said Congress, in enacting the 1978 legislation called the Pregnancy Disability Amendment, intended “to construct a floor beneath which pregnancy disability benefits may not drop--not a ceiling above which they may not rise.”

Cal Fed then sought review from the nation’s highest court.

The justices had been considering the legitimacy of a similar law in Montana, but the court took no action in that case today.

Harmful Effects

In the Montana case, the National Organization for Women and other organizations urged the court to rule that such state laws must bow to federal law.

“Legislating on the basis of pregnancy as Montana has done might appear superficially to be beneficial to women but in fact it has many harmful effects,” the groups’ joint brief contended.

“At least some employers respond to such incentives by not hiring women,” the groups said.

The 1978 amendment “provides that persons may not come into compliance . . . by reducing benefits to the favored class--in this case, pregnant employees,” the brief said.

The Reagan Administration agreed with the feminist groups that the Montana law should be overturned. But Justice Department lawyers said requiring leaves for all employees “might well be inconsistent with the clearly expressed intent of Congress in enacting the (1978 law).”

“Congress repeatedly emphasized that it intended that employers be free to provide any level of benefits they wished--or none at all--so long as they did not use pregnancy as a criterion for allocating those benefits,” the government lawyers said.