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As already noted the prohibitions of the title do not become effective until July 2, 1965. From July 2, 1965, to July 1, 1966, it is applicable to employers of 100 or more employees; from July 2, 1966, to July 1, 1967, the minimum is lowered to 75 employees; from July 2, 1967, to July 1, 1968, the minimum is 50 employees; and thereafter, to employers who have 25 or more employees.

Section 701(b) makes a number of selective exemptions from the category of "employers." The Federal Government and corporations wholly owned by it are excluded from the definition. Similarly excluded are States and their political subdivisions, Indian tribes, and private membership clubs. As pointed out by Senator Robert Byrd “the exclusion of the Federal and State Governments does not mean that they are free to discriminate with regard to public employment opportunities. The former is covered by the President's Committee on Equal Employment Opportunities, the latter is covered by the equal protection clause of the 14th amendment.” 23 Furthermore, the leadership compromise added a statement in the form of a proviso to section 701 (b) that it is the policy of the United States to insure equal employment opportunity for Federal employees. Senator Humphrey explained that this change hardly represents a change in the law, but it was thought desirable because the United States, like all governmental units, State and local, is generally excepted from the category of employers covered by the title.30

Section 702 exempts employers with respect to aliens they employ abroad and educational institutions with respect to educational personnel. Section 702 also exempts religious organizations, but only with respect to the “employment of individuals of a particular religion to perform work connected with the carrying on” of its religious activities. *1

It should be noted that the last mentioned group of exceptions only offer a partial exemption from the act. Thus, an employer of aliens abroad may be otherwise covered if his domestic operation is an "industry affecting commerce and it meets the minimal standards with respect to the number of employees. The exemption in favor of educational institutional and religious organizations is limited to individuals whose work relates to the essential nature of such institution or organization i.e., educational and religious activities. In all her respects, title VII is applicable to these two categories of "employers” who other wise meet the jurisdictional standards of section 701.

An "employee” is defined by section 701 (f) as "an individual employed by an employer." The sole apparent limitation on the word "employees ander the definition is that the individual must be employed by a covered employez. In short, every member of the work force, from the highest to the lowest is deemed an employee and to be counted in computing the total number of personnel. However, it appears that neither board members Dot stockholders are to be considered employees.23

As defined by section 701 (3), title VII applies to all employment agends which “regularly” procure employees for a covered employer or which "regularly procure for employees opportunities to work for covered employers. In other words, it is the fact of a covered employer that makes an employment agenes amenable to the act. The term includes the U.S. Employment Service and the system of State and local employment services receiving Federal assistanes but not any other Federal, State or local agencies."

The definition of “labor organization” in section 701 (d) 19 substantial the same as the definition in the Labor Management Reporting and Dixeira Act of 1959,* except that State and local central bodies are treated a other labor organizations. It includes "any organization of any kind *:. in which employees participate and which exists for the purpose *** of legal ing with employers concerning grievances, labor disputes, wasnt rates of Day, hours, or other terms or condit! national unions and

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Labor organizations are covered only if they are engaged in an “industry affecting commerce" within the meaning of the act. Section 701 (e) » describes a labor organization so engaged in two ways: First, as a labor organization that maintains or operates a hiring hall or office to provide employees for a covered employer or to procure for employees opportunities to work for a covered employer. Labor organizations operating hiring halls are covered without regard to their numerical strength. In the words of Senator Humphrey, “whenever a labor organization maintains a hiring hall which supplies workers for employers covered by the title, that labor organization is deemed to affect commerce and is covered by the title.” 38

Second, as a labor organization which has an aggregate number of 25 or more members when the act becomes fully effective. As in the case of covered employers, title VII applies to labor oganizations in four annual stages, depending upon minimal levels of membership of 100, 75, 50, and 25. If it meets the numerical standard, a labor organization is covered if it (1) is certified as the bargaining representative under the National Labor Relations Act, or Railway Labor Act, or (2) is recognized as the bargaining representative by a covered employer, or (3) has some formal relationship with a covered labor organization whether through a charter or as a joint interest organization.

Although the definition of "labor organization" compares with that in the Labor Management Reporting and Disclosure Act of 1959, there is no reference to the earlier enactment. As a result, the limitations of the latter-i.e., supervisors, agricultural workers, etc.--should not be read into title VII. The fact of the broader coverage is reinforced by the broad definition of employee in section 701 (f). (6) Prohibited practices

Section 703 consists of 10 subsections ; 4 of these describe a number of activities which if engaged in by covered individuals or organizations will constitute unlawful employment practices. The remaining six subsections set out various limiting qualifications. 39

Discrimination by employers falls into four general areas: (1) hiring and firing, (2) employment conditions, (3) segregation and classification, and (4) training programs. Section 703 (a) makes it an unlawful employment practice for an employer to fail or refuse to hire or to discharge any individual because of his race, color, religion, sex, or national origin. It also makes it an unlawful employment practice for an employer to discriminate against an individual becasue of his race, color, religion, sex, or national origin with respect to compensation, terms, conditions, or privileges of employment. Also under section 703(a), an employer is forbidden to limit, segregate, or classify employees in any way that would deprive or tend to deprive any individual of employment opportunities or otherwise adversely affect his status as an employee because of his race, color, religion, sex, or national origin.

Section 703(d), applicable to labor organizations or joint labor-management committees as well as employers, prohibits discrimination on the basis of race, color, religion, sex, or national origin in admission to or employment in any apprenticeship training or retraining program. This includes on-the-job training programs.co

Under section 703 (b), it is an unlawful employment practice for an employ. ment agency to (1) fail or refuse to refer for employment, or otherwise discriminate against any individual because of his race, color, religion, sex, or national origin, or (2) classify or refer any individual for employment on the basis of his race, color, religion, sex, or national origin. By virtue of the definition of "employment agency" in section 701 (c), these prohibitions apply not only to private employment agencies, but also to "the U.S. Employment Service and the system of State and local employment services receiving Federal assistance." "

Insofar as labor organizations are concerned, the prohibitions of title VII affert them in both their capacity as employers and as organizations representing employees. With respect to the former, they are subject to the prohibitions applicable to employers generally, as described above. In their capacity as

37 42 ( S.C. 2000e(e). ** 110 Congressional Record, p. 12297 (daily edition, June 4, 1964).

42 USC. 2000-2. 40 42 USC. 20000 2(d). € 42 [' S.C. 2000-2(b).

labor organizations, unions are affected in three general areas by section 703(c). First, they may not exclude or expel from membership, or otherwise discriminate against any individual because of his race, color, religion, sex, or national origin. Second, they are forbidden to limit, segregate, or classify membership, or classify or fail or refuse to refer for employment any individual in any way that would deprive him of employment opportunities or otherwise adversely affect his status as an employee or as an applicant for employment because of his race, color, religion, sex, or national origin. Third, labor organizations are prohibited from attempting to cause employers to discriminate.

As with employers, labor organizations and joint labor-management committees are prohibited by section 703 (d) from discriminating with respect to apprenticeship and other training programs.

As noted elsewhere, there are a number of exceptions to the general prohibi. tion against employment discrimination on account of race, color, religion, sex, or national origin. By and large, these exceptions are narrowly confined and intended to have very limited effect. The first and perhaps the broadest of the group is contained in section 703 (e) (1).43 Under this section, employers, employment agencies, and labor organizations are permitted to discriminate on the basis of religion, sex, or national origin “in those certain instances where religion, sex, or national origin is a bona fide occupational qualification reasonably necessary to the normal operation of that particular business or enterprise." This exception applies to hiring by employers, classification and referral by employment agencies, classification or referral by labor organizations, and admission or employment in an apprenticeship or other training program generally. This exception also applies to the ban against discriminatory job notices or advertising which is discussed elsewhere. An “Interpretive Memorandum" inserted in the Congressional Record on April 8, 1964, by Senator Clark gave the following examples of legitimate exception permitted by section 703(e) (1):

“Examples of such legitimate discrimination would be preference of a French restaurant for a French cook, the preference of a professional ball team for male players, and the preference of a business which seeks the patronage of members of particular religious groups for a salesman of that religion.”

Section 703(e) (2) allows religiously affiliated educational institutions to hire employees along religious lines.45 Unlike the qualified exemption in section 702, this exemption is apparently not limited to educational employees but extends to the institution's entire work force,

Section 703(f) provides that the term "unlawful employment practice” shall not include any action taken against any individual “who is a member of the Communist Party of the United States or of any other organization required to register as a Communist-action or Communist-front organization by final order of the Subversive Activities Control Board pursuant to the Subversive Activities Control Act of 1950." 46

Briefly, section 703(g) provides that it is not an unlawful employment practice to deny any person a job if he cannot obtain the requisite security clearance. As described by Senator Humphrey, this provision

may not be used as a pretense for denying employment on the basis of race, religion, sex, or national origin. Thus, if employers normally require their employees to apply for clearances only after they are hired, such employers may not refuse all Negro job applicants on the ground that they lack a security clearance at the time they apply for a job. Actually, this provision is intended to cover the obvious situation where a person, for one reason or another, is simply not able to obtain a required security clearance. In such cases, the employer should not be liable under this title if he refuses to hire or discharges such a person for that reason.

“The provision thus adds no new substantive exemption, but merely makes express what would have been possible even without the amendment. The title, as presently drawn, would not have prevented those covered by it from refusing or terminating employment on bona fide security grounds, where applicable, and the amendment does no more than make this clear." 47

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42 42 U.S.C. 2000-2(c). 13 42 U.S.C. 2000e2(e) (1). 44 110 Congressional Record, p. 6992 (daily edition). 45 42 U.S.C. 2000e-a (e) (2). 46 42 U.S.C. 2000e-a (f). 47 110 Congressional Record, p. 12297 (daily edition, June 4, 1964).

Section 703(h) contains three additional qualifications on the broad principle of nondiscrimination in employment. The first of these provides that it shall not be an unlawful employment practice "for an employer to apply different standards of compensation, or different terms of employment pursuant to a bona fide seniority or merit system, or a system which measures earnings by quantity or quality of production or to employees who work in different locations, provided that such differences are not the result of an intention to discriminate because of race, color, religion, sex, or national origin." In short, differences in treatment in certain factors will be permitted where they are not intentionally employed to accomplish discrimination by indirection.

** For example, if an employer has two plants in different locations, and one of the plants employs substantially more Negroes than the other, it is not unlawful discrimination if the pay, conditions, or facilities are better at one plant than at the other unless it is shown that the employer was intending to discriminate for or against one of the racial groups. Thus this provision makes clear that it is only discrimination on account of race, color, religion, sex, or national origin, that is forbidden by the title. The change does not narrow application of the title, but merely clarifies its present intent and effect.”

The second qualification in section 703(h) provides that it shall not be an unlawful employment practice for an employer to give and to act upon the result of a professionally developed ability test provided they are not "designed, intended, or used to discriminate because of race, color, religion, sex, or national origin.” This provision was added by an amendment sponsored by Senator Tower. At the time of its original submission, the Senator made the following remarks in support of its adoption:

"Mr. President, I hope my colleagues in the Senate will give very careful attention to the amendment. I believe the proponents of the bill realized that this is not an effort to weaken the bill. It is an effort to protect the system whereby employers give general ability and intelligence tests to determine the trainability of prospective employees. The amendment arises from my concern about what happened in the Motorola FEPC case, I have discussed the case in great detail in the Senate, and I shall not repeat my argument.

“Let me say, only, in view of the finding in the Motorola case, that the Equal Employment Opportunity Commission, which would be set up by the act, operating in pursuance of title VII, might attempt to regulate the use of tests by employers.

*Senators will recall that in the Motorola case the FEPC examiner found that the test used to select employees was discriminatory to culturally deprived or disadvantaged groups, in the words of the FEPC examiners.

"Since the determination in that case, it has been clearly stated by psychiatrists and testing experts that the test was not designed to make a selection from any cultural group. and that the tests are both fair and extremenly useful. There is no professional evidence to the contrary.

“My amendment is quite simple. It provides that an employer may give any professionally developed ability test to any individual seeking employment or be ing considered for promotion or transfer or to act in reliance upon the result of any such test.

"Senators will note that I carefully provide in my amendment that the employer must give such tests to all concerned individuals; that is, to all applicants, without regard to the individual's color, religion, sex, or natural origin. Thus every one would get the same fair test, and everyone would get the same fair chance.

"The bill is supposed to be designed to assure that a fair chance is obtained by everyone. Therefore it is in this spirit that I offer the amendment.

"In the Votorola case a test was given which had been in use since 1949, a test that was derised by trained. professional, reputable psychologists, a test which was available to other corporations. A legro taking that test was denied employment as the result of that test.

"Motorola hires many people of many different national origins. It also hires many Vegroes. It has had a very good record of nondiscriminatory practices. It has had pretty good labor relations. The FEPC examiner stated that the test could not be used; that the test was a denial of a fair employment opportunity.

42 V'.S.C. 200022h).

Senator Humphres, 110 Congressional Record, p. 12297 (daily edition, June 4, 1964). 5* 110 Congressional Record, p. 13246 (daily edition, June 13, 1964).

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because it discriminated against what he vaguely called culturally deprived or disadvantaged groups.

“This is highly unreasonable, because if title VII were administered in this fasihon, it would mean that an employer would be denied the means of determining the trainability and competence of a prospective employee, or the competence of one who is currently employed and who is being considered for promotion.

My amendment provides that everyone who applies must be allowed to take the test regardless of his race, color, national origin, sex, or creed. It provides that the test must be fairly administered so that there will not be any discriminatory practices because of color.”

The final qualifying provision of section 703(b) permits pay differentials based on sex that are authorized under the Equal Pay Act of 1963—i.e., differences in compensation based on a seniority system, a system measuring earnings by quantity or quality of production, or any factor other than sex.

Simply stated, section 703 (i) permits businesses operating on or near an Indian reservation to accord preferential treatment to Indians. This exemption is consistent with the Federal Government's policy of encouraging Indian employment and with the special legal position of Indians.

Section 703(j) provides that nothing in title VII requires that preferential treatment be given any individual or group on account of an imbalance that may exist with respect to the total number of percentage of persons of any race, color, religion, sex, or national origin in comparison with the total number or percentage of such persons in that or any other community. This provision applies to the admission to apprenticeship or other training programs as well as hiring by employers, referrals or classifications by employment agencies, and admission to union membership. Its inclusion in the act was intended to blunt charges by opponents that title VII would establish employment quotas.

“The proponents of this bill have carefully stated on numerous occasions that title VII does not require an employer to achieve any sort of racial balance in his work force by giving preferential treatment to any individual or group. Since doubts have persisted, subsection (j) is added to state this point expressly. This subsection does not represent any change in the substance of the title. It does state clearly and accurately what we have maintained all along about the bill's intent and meaning.55

In addition to the discrimination forbidden by section 703, there are ancillary prohbitions in section 704. Subsection (a) prohibits discrimination by an employer, employment agency or labor organization against persons for opposing discriminatory practices, and for bringing charges before the Commission or otherwise participating in proceedings under the title. Subsection (b) prohibits discriminatory advertising by employers, employment agencies and labor organizations. An exception is authorized where the discrimination is based on a bona fide occupational qualification. “It should be noted that the prohibition does not extend to the newspaper or other publication printing the advertisement. It runs solely to the sponsoring firm or organization.” 57 (c) Administration and enforcement

The principal enforcement organ under title VII is the Equal Employment Opportunity Commission created by section 705.58 The new Commission is composed of five members, not more than three of whom may be members of the same party. Commission members are to be appointed by the President by and with the advice and consent of the Senate. Although initial appointees will serve 1, 2, 3, 4, and 5 years' terms, respectively, all subsequent appointments will be for a full 5-year term. The President is to designate both the Chairman and Vice Chairman. The Chairman will be responsible for the administrative operations of the Commission and will staff the agency in accordance with civil service laws.

The principal office of the Commission is to be in or near the District of Columbia, but it is authorized to meet or exercise its powers at any place. Regional or State offices may be established as the Commission deems necessary.

61 110 Congressional Record, pp. 13018–13019 (daily edition, June 11, 1964).

42 U.S.C. 2000e-2 (i). 5 110 Congressional Record, p. 12297 (daily edition, June 4, 1964).

54 42 U.S.C. 2000e-2(j). 36 Senator Humphrey, 110 Congressional Record, p. 12297 (daily edition, June 4, 1964).

58 42 U.S.S. 2000e-3.
57 Senator Clark, 110 Congressional Record, p. 6992 (daily edition, Apr. 8, 1964).
88 42 U.S.C. 2000e-4.

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