Justices’ Decision Seen as Setback to Retirees : Lower Court’s Finding in Westinghouse Age-Discrimination Case Is Set Aside

A $35-million age-discrimination settlement--the Equal Employment Opportunity Commission’s largest ever--may be out of reach for 4,000 Westinghouse Electric Corp. retirees following two Supreme Court decisions, a legal specialist said.

The Supreme Court on Monday vacated an appeals court ruling that Westinghouse discriminated against the retirees by offering them a choice of either severance pay or early pensions, but not both.

The appeals court must now reconsider EEOC’s charges against Westinghouse, in light of a June Supreme Court ruling that tilts the discrimination law in favor of employers.

The EEOC had a $35-million settlement in hand in August, 1988, but walked away from it to seek a court ruling that could have led to an even bigger payment for the retirees.

“It means they blew it. They got greedy,” Dick Lauver, a Pittsburgh pension lawyer who was not involved in the case, said Monday night. “They chose to forgo a very favorable settlement to get a favorable court decision.”

Dispute on Guidelines

Donald Livingston, executive assistant to the EEOC general counsel, said Tuesday that Lauver “knows nothing of the settlement and knows nothing of the settlement process and maybe he’s not adequately familiar with the case.”

Livingston said EEOC believed that up to 10,000 Westinghouse retirees might have qualified to share in the settlement, but the two sides could not agree on guidelines for identifying additional retirees.

In addition, the settlement would have required the agency to approve a future benefits plan that was too similar to the one the 3rd U.S. Circuit Court of Appeals deemed illegal.

Livingston said “$35 million seemed to be an inadequate settlement.”

The case was pending before the federal appeals court when the two sides settled. After the EEOC backed away, the appeals court took up the case again and ruled against Westinghouse. The company appealed to the Supreme Court early this year.

The Supreme Court’s June ruling came in an Ohio case. The court said employees have the burden of proving that the employer intended to discriminate. Before the decision, employers had to demonstrate why the disputed programs were not discriminatory.

“The law is much more beneficial to Westinghouse than it was in June,” Livingston said. “Right now, I don’t know what this case is worth.”

A number of issues remain to be decided in the Westinghouse case, he said.

“I think the case is far from over,” Livingston said.

Bills Introduced

The June ruling could affect about 30 cases pending in the courts, said EEOC spokeswoman Deborah Graham. An additional 406 complaints still being investigated by the EEOC could also be affected, she said.

Three bills have been introduced in Congress that would restore the law to its terms before the Supreme Court’s June decision, although not all of them would be retroactive.

Westinghouse, meanwhile, is looking forward to having the appeals court reconsider its case, said company spokesman Jim Schmitt.

“Westinghouse is delighted,” he said.