Alaska USA Federal Credit Union v. Fridriksson

ALASKA FEDERAL CREDIT

UNION, Appellant,

Valgerdur FRIDRIKSSON, Alaska State

Commission Human

Rights, Appellees.

No. 5230.

Supreme Court of Alaska.

March began working

Fridriksson as a teller for two-person Alaska USA office in Adak June, in prior experience 1975. Her includ- ed nineteen months as a for teller the Na- tional Bank of Iceland from year and one in savings that bank’s and department loan from 1961 to 1962. She had not worked during years the ten be- tween 1965 and 1975. Four months after began Adak, Fridriksson work in the branch manager quit. Fridriksson applied for the position, and was recommended for it outgoing manager. Fancher, Leo a sen- ior loan officer of Alaska USA came Adak to evaluate the office’s operations and told Fridriksson that he tell Anchor- age that he had picked manager. her as Paul Nangle, Nangle J. & Clark and Ste- authority Fancher’s Oliver, did not include the ven P. Anchorage, appellant. for managers. branch authority That Jones, Gen., E. Carolyn Asst. Atty. An- vested in Alaska general USA’s chorage, Condon, Gen., Atty. Wilson L. manager, delegated who had it to his assist- Juneau, appellees. ant, William Eckhardt. Fridriksson was not hired. OPINION December, 1975, In Fridriksson filed her RABINOWITZ, J., CONNOR, Before C. complaint With the Commission. Alaska MATTHEWS, JJ., BURKE and challenged jurisdic- USA the Commission’s

COOKE, Superior Judge.* Court tion, ground USA, on the Alaska union,

nonprofit credit was exempt from MATTHEWS, Justice. coverage of the Human Act. examiner, hearing The how- Commission’s Fridriksson, Valgerdur employ- a female ever, rejected challenge. Testimony this ee of the Alaska USA Federal Credit Union June, 1977, in was taken in Adak and An- Adak, applied in October [“Alaska USA”] chorage. hearing examiner issued his of 1975 for the position manager branch recommended He decision December. of the Adak office. not promoted; She was concluded that Fridriksson had been denied a male applicant was hired Fri- instead. promotion account of her sex. The Com- driksson then filed complaint with the essentially adopted hearing mission ex- Alaska State Commission for Human opinion May, aminer’s decision in its Rights, alleging sex discrimination in viola- 18.80.220(a)(1).1 tion AS The Commis- sion ap- ruled her favor. Alaska appealed USA Alaska then USA Commis- pealed court, to the superior which affirmed superior sion’s decision to the court in An- ruling. Commission’s chorage. February, up- In the court * Cooke, Superior Judge, sitting by race, assign- of religion, Court ment because of his color or pursuant IV, ment made to article origin, age, section 16 physi- national cal or of his because the Constitution of status, Alaska. handicap, sex, changes marital status, parenthood pregnancy marital 18.80.220(a)(1)provides: 1. AS when reasonable demands of employment practices (a) Unlawful It is un- require age, do not physical handicap, changes distinction on the basis of lawful for sex, status, marital (1) employment to refuse ato status, pregnancy par- marital person, employment, or to bar him from or to enthood; against compensation discriminate in him in term, condition, privilege employ-

held zation under points any the Commission on all relevant reasonable construction appeal. appealed has of that term. again. agree reasoning. with this We We The issues for review are whether that, unions, however, “[cjredit also observe jurisdiction Commission had over Alaska be, they may purely useful exist for mer USA; so, if whether the Commission cor- purposes although they may cantile rectly found that Alaska failure to USA’s basis, organized non-profit on a members promote illegal Fridriksson constituted sex join profits credit unions in search of on discrimination; so, if whether the Commis- Quijano University their investments.” sion correctly damages assessed due Fri- Union, 129,133 (5th Federal Credit 617 F.2d driksson. 1980). Cir. This construction is also consist view, ent with the expressed by often

I. JURISDICTION court, rights civil statute Alaska’s Alaska first reasserts its contention USA should be broadly construed “to further the the Commission jurisdic- was without goal of eradication of discrimination.” tion 18.80.220(a)(1) over it. it AS makes Inc., Products, Wondzeil v. Alaska Wood illegal “employer” engage for an in sex 584, (Alaska 1979) 601 (opinion P.2d 585 discrimination in employment practices. State, rehearing); see McLean v. 583 P.2d “Employer” 18.80.300(3) is defined in AS 867, (Alaska 1978); Employees 869 Hotel excluding social, exclusively “a club that is Thomas, Local 879 v. 551 P.2d 946-47 fraternal, charitable, educational, or a (Alaska 1976); Loomis Electronic Protec religious corporation, association or a if the tion, Schaefer, Inc. v. P.2d club, corporation organ- association or is not (Alaska 1976). ized for private profit.” Alaska ar- USA gues that exemption, it falls within this II. THE CLAIM OF SEX DISCRIMI- fraternal, since it is nonprofit and its mem- NATION bership being limited to certain defined A. The Prima Facie Case groups. Membership in the credit union is The Commission found that Fridriksson open to military personnel and civilian at pri- had established the four elements of a Elmendorf, Adak Shemya military and bas- ma facie case of sex es, discrimination set out Guard, members of the Air National Supreme United States Court Patrol, senior members of the Air Civil McDonnell-Douglas Green, Corp. v. shareholders in ten Native regional corpora- 1817, 1824, tions, and employees of certain contractors (1973) :2 of Alyeska Pipeline Company. Service (1) protected that she is a concluded, member of a among The Commission other (women); class things, that Alaska was not a frater- USA nal stating: association (2) qualified that she for applied A review groups actually eligible of those manager position; for vacant branch to participate in the Alaska USA Federal (3) rejected despite she was her Credit Union commonality reveals no of qualifications; and interest other than employment physi- (4) open the position remained

cal presence in Alaska. While the char- continued to seek applicants. tering authority may have found this to be a sufficiently neighbor- finding “well defined Alaska USA takes issue with the hood, community or rural district” for of the Commission that Fridriksson was membership purposes qualified under the manager position federal for the branch law for credit 1759], unions it argues qualification USCA Adak. It that one [12 could hardly be organi- called fraternal manager position for the branch was that adopted McDonnell-Douglas 2. This court Alaska State Comm’n for Human v. Yel- prima case, Cab, (Alaska 1980). facie test in a sex discrimination low 611 P.2d 487 management preference ters of mere applicant previous have competing between education, applicants are to the experience employer’s best left Fridriksson objective case in qualifica rebuttal.3 Such did not fulfill this requirement. might specific tions include educational or We believe that the Commission’s experience applicant criteria be clearly license, was not erroneous. special the holder certificate or component qualifications of the McDonnell- present only quali In the case the objective Douglas test only sensibly applied can if fication which was testified to was the re qualifications it to which refers are quirement high of a school education. Oth objective actually ones which have been es simply er than that Alaska USA tried to for tablished in question. person job.4 Mat the best find could 4. William 3. The qualified the claimant has not made a as follows branch (D.C.Cir.1980); Rogillio v. Diamond Shamrock (S.D.Tex.1977). ant Chemical Davis v. 1979). job not er, to decision, cie case under the McDonnell standard does 957]; ant to refute ployment firing offer his rationale for A. It seems more sensible to discriminatory less ing ^[567] employer might credit union? the McDonnell model. know, Q. work with [Construction supervised people, know, experience, We person look Q. branch A. two Adak of mal ly Q. general manager, offer his to—to train in constitute of branch and try What are the Well, What I don’t fact that So, years. qualified. they you for; and, agreement manager. at 576 See Davis v. Calif McDonnell is his branch, the letters, retainability, than the claimant does not mean that move in and out of that we can for the Weidner, managers to find what are the minimum Eckhardt, evaluating Co., look rather rebuttal to the will discrimination. The there’s no hard cast complainant concerning qualifications people; certainly understand justification [98 one stay hypothetical for? manager and that’s —We have an infor- as I’ve stated in—in a number the — Corp. Waters], Establishment of a refusal than with each branch people ultimate 596 F.2d have found him at various F.Supp. applicant the Credit Union’s assist- their in the area minimum of qualifications administrative merely evidence was asked the—you to refusing the ano, in the second to at Adak? education, ability and have are force the for his complainant’s require a model for order- hire....; 726, because it 423, 426-27, qualifications job question? reasons 613 F.2d might required branches particularly concerning someone that’s know, qualifications. employer as far to qualifications employment the of fact as a hire facie case. type, complain- be better answered relatively ’em, you why manager (7th employ- the best jobs Furnco as, you step is for the case, we’d cost- em- Cir. can the the for for fa- as of to finance just Q. they worked for—it could. favorable to an rience as a—a salesman or a sales A. A. you sort of A. have to have a A. have person the A. Q. levels like ative Q. A. How How much education? the office deal with know, Q. A. —that Q. A. can’t you Q. education, and, A. person tive Q. A. Yes. Q. consideration? person? one were to come into the office and Q. Q. Q. A. That’s what the interview A. every any personnel management, person. Well, —opinion Well, Well, Yes. I So, Well, through High Oh, Depending If I And so what is Well, So, Okay. know, Would Okay. It could an evaluation of their know, feelings qualify just qualify to case of the areas I’ve I wouldn’t look experience? that as an background just they choose between two granted. do I school would—For then how do people it’s different in stated them. and, you there’s no where you qualify rigidly. it you —If But very you be. for that— is, applicant. know? of the must have some you rely high you say on what applicant. you’d say your— —an but— are education, the far as someone were and this It could be. they Well, that’s the most know, interviews and know—it’s going school education. or—But position? given person? introvert example, just particular experience would have to have a like a you that —as favorably upon they okay, every to hire? my opinion of—of sort outlined would be the most your okay. but to—if some- experience, know any high sold process people I can’t very to would own situation. they far experience education. thing, represent- And what when come into important and school— couldn’t through difficult weight? subjec- would which say is for. expe- were, their who that you you I essence, found, The Commission high Fridriksson had a school edu- Since cation, explanations unworthy these were the Commission did not err con- belief, that Fridriksson’s “sex was a cluding qualifications that she met the com- promote her.” factor the decision ponent of the McDonnell test. This conclu- of fact and as such This is a determination supported by sion is further the fact that sup to stand if it is must be allowed Adak, at as well prior manager branch sup evidence.6 ported by substantial Such Fancher, as Leo the senior loan officer sent port does exist in this record. manager termi- outgoing Adak when the nated, both indicated that Fridriksson was The Commission determined qualified manager position. for the branch application was not taken seri Fridriksson’s union, noting that

ously by the credit “[i]t appear qualifications does not [her] Explanations B. Offered compared appli were with those of other testimony position.” cants for the a prima facie case of discrimi Once Eckhardt, who made the made, nation is it becomes incumbent on bears out the that he made no such fact the employer legitimate, “to articulate some comparison. nondiseriminatory employee’s reason for the employ- The Commission found “that the rejection.”5 McDonnell-Douglas, 411 U.S. assumptions er made a number of about the at 93 S.Ct. at 36 L.Ed.2d at 678. training, ability supervise, cost of If this, employee does date, complainant’s adequacy rotation then opportunity has the demonstrate to housing of that it would not and did not that this reason is not the true reason for find- applicants.” make with male These the employer’s decision. “She succeed ings supported by are also the evidence. in this directly by persuading either [the example, respect housing, For with to trier of that a discriminatory reason fact] simply assumed that Fridriks- USA likely more than employ not motivated the family son’s would not wish to live in the er or indirectly by showing employ that the which it furnished for branch mana- trailer er’s proferred explanation unworthy is of gers It in Adak. never asked whether credence.” Department Texas of Commu never sought explore was so and to alterna- nity Burdine, 248, 256, Affairs v. tive uses for the trailer which would have 1089, 1095, 101 S.Ct. 67 L.Ed.2d 217 protected its interests in the event Fridriks- (1981). son did not desire to move. In the present argued case Alaska USA respect With to Fridriksson’s rotation

that its refusal promote to Fridriksson was date, Alaska assumed that Fridriksson on following 1) based grounds: that give year could not the two commitment it Fridriksson would not commit herself to desired because she had written “undecid- staying 2) two-year period; Adak for a opposite ed” “rotation on words date” person that Fridriksson’s five family was application position her for a clerical with large too to occupy the credit union’s two the credit union some months before. Adak; 3) bedroom trailer at it would time, any period “Undecided” could mean of Fridriksson; 4) be too costly to train requested but the credit union never a clari- that Fridriksson did not have substantial Fridriksson testified that the in- fication. business management training experi- decision to which she referred was whether ence. family she her for a stay would Adak your subjective feeling very impor- Department Community But is counsel. Texas

Q. Burdine, 248, 256, tant? Affairs v. U.S. 101 S.Ct. Yes, very important. A. (1981). it’s 5. The articulation must be based on admitted 6. Alaska State for Human Comm'n evidence; employer may rely solely not on Cab, (Alaska 1980). Yellow 611 P.2d complaint, arguments his answer to the or on long its Adak branch period years manager. agree. as short as five as We no if ten. Alan who was hired There was evidence that Andrews Fridriksson promoted had been to the branch manager branch instead of Frikriksson left manager she willing would have been applica- space rotation date blank his by utilize trailer furnished the credit tion. building union without an addition to it. testimony A central feature of Eckhardt’s duty The credit union no had to allow such was explanation the costs which an addition to be Assuming built. that she training would have been involved in Fri- trailer, not have used the it likewise testimony driksson. This substantially was not was that she established would have examination, impeached on cross demon- by been salary entitled to an additional repre- strating credit union did not hesi- senting the fair rental value of the trailer. tate to incur similar costs where the new Therefore, portion because this of the Com- manager was be a man. supported mission’s award not respect With to Alaska USA’s contention evidence must be eliminated. manage- Fridriksson lacked substantial part, AFFIRMED in REVERSED in ment training experience, Eckhardt nev- part, REMANDED for recalculation of compared er qualifications Fridriksson’s the amount due. with applicant, those of the successful An- drews, in making either RABINOWITZ, J., concurs. C. explaining hearing it to the officer. J., CONNOR, dissents. Nor was such a comparison offered other COMPTON,J., participating. not testimony. no compelling There was thus preferable evidence that Andrews awas RABINOWITZ, Justice, concurring. Chief candidate to Fridriksson. agree I the Commission’s and the In summary, say we are unable rulings superior court’s should be sustained the Commission’s determination that Fri- conclude, appeal. I am unable to how- driksson’s sex was a factor her failure to ever, proven that Fridriksson need have gain promotion is without substantial prevail.1 intentional discrimination to evidentiary support. That determination alleges gender a woman was a When must therefore be affirmed.7 in employer’s hiring factor an an indispensable requisite of her is claim that III. DAMAGES employer willfully the discriminated. Ab- proof discriminatory sent a of motive of final point appeal USA’s on from such can facts which a motive be is that the in ruling Commission erred that inferred, discriminatory a claim woman’s of Fridriksson was entitled to an award of rejected.2 treatment must be per month representing $300.00 the fair rental of value the credit union’s house In this we case are faced with a situation trailer which charge it furnished of free to in which on findings the Commission’s the finding 7. The Commission’s that “intentionally 2. Since have the credit un- we relied on federal Title VII guidance interpreting ion’s actions were not and will- cases for anti- Alaska’s fully statutes, discriminatory” is not inconsistent with discrimination see Alaska State Cab, its conclusion that the credit union had discri- Comm’nfor Hum. Rts. v. Yellow 611 P.2d 487, against (Alaska 1980), precedent minated sex. Fridricksson of her 489-92 federal because discussing requirement proof purposeful the of discrimi- Discrimination need not be of natory 18.80.220(a)(1). Instead, be unlawful under motive is instructive here. As the Su- AS result, preme may unlawful discrimination Court observed International Bhd. of as Mr. Jus- States, 324, tice text, Teamsters v. United 431 Stevens has observed in a U.S. different con- 1843, byproduct (1977): as an “accidental of S.Ct. 52 L.Ed.2d 396 a tradition- way thinking al of about females.” “Disparate alleged Califano treatment” such as is Goldfarb, 199, 223, 1021, easily 430 U.S. present the stood case is the most under- 1035, 270, J., (1977) (Stevens, 51 L.Ed.2d type of discrimination. The concurring judgment). simply people favorably treats some less than race, color, religion, others because of their sex, origin. 1. See note 7 ante. Proof of national discrimina- 8X0 findings supported by those are substantial discriminatory appear

crucial issue of intent hand, Similarly, the Commission’s find- to be one the Com- evidence. inconsistent. On justifi- proffered that the credit union’s ing had estab- mission found that Fridriksson hiring lacked credi- cations for its decision discriminatory facie case of prima lished adequately supported by is the record. bility prima that facie case treatment legal that follows from union; The conclusion by was unrebutted the credit gender that prima facie case is unrebutted hand, other that the Commission noted employer’s hiring deci- was a factor in the will- “intentionally credit union had not sion. To the extent Commission Notwithstanding fully” discriminated.3 the credit union’s actions concluded I believe that apparent inconsistency intentionally discriminatory, were not concluding is correct majority legally at odds with the sufficient finding is treat- discriminatory Fridriksson’s claim of supplied by the inference of discrimination requisite ment is well-founded because case, must facie and the prima proof discriminatory supplied motive is support in the record. rejected as without by prima Fridriksson’s unrebutted facie case of discrimination. Commission’s CONNOR, Justice, dissenting. findings establish the existence of a of fact discrimination, respectfully I must dissent. facie case of critical, eligibility. aggrieved person tory although that class from An motive is it can exclusionary challenging propriety some situations be inferred from the mere fact of differences in treatment. of an only show criteri- criterion need that the n.15, n.15, Id. at 335 97 S.Ct. at 1854 52 L.Ed.2d class; disparate impact protected on a on has (emphasis supplied). agree at 415 n.15 employers’ I he need not further demonstrate that the crite- personnel decisions often be discriminatory: designed rion was to be product preconceived notions about the discriminatory absence of intent or [G]ood gender marketplace role of in the rather than of employment proce- intent does not redeem faith, purposeful design place a bad at a women testing operate mechanisms that as dures disadvantage. the extent that the ma- To minority groups and “built-in headwinds” for jority aggrieved takes the that an measuring job capability. are unrelated to employ- woman need demonstrate that an 424, Co., 432, Griggs v. Duke Power faith, align er’s decision was made in bad I (1971). 91 S.Ct. myself majority. purpose with the A basic Moody, Paper Albemarle Co. v. See also legislation Alaska’s antidiscrimination is to (1975), U.S. 95 S.Ct. 45 L.Ed.2d 280 by gratuitous, eradicate the barriers created disparate impact case relied on a later stereotyped assumptions suitability about the support proposition for the Commission proof majori- employees. of women as Insofar as the discriminatory motive was not a nec- ty charging discriminatory that a woman holds essary Fridriksson’s case. The Su- element of gender treatment need not demonstrate that was a factor in an preme disparate impact jurisprudence Court’s employer’s personnel deci- not, however, disparate applicable to a treat- is sion, however, agree majori- I cannot with the such the one at hand. As the ment case ty. explained: has Court erroneously 3. The Commission concluded discriminatory Proof of motive is critical a[in showing a of intentional discrimination was not disparate case], although treatment it can in necessary in order to find for Fridriksson. To some from the mere situations be inferred justifi- reach this conclusion the Commission fact of in treatment. ... differences ably precedent, relied on federal Title VII but disparate Claims of treatment be dis- distinguish failed to ing crimination, between federal cases deal- tinguished “disparate from claims that stress disparate theory with the treatment of dis- impact.” employment involve The latter requires proof which of discrimi- facially practices in their that are neutral motive, natory applying dispa- and cases the groups treatment of but that in fact different impact theory, proof rate under which of dis- harshly group fall more on one than another criminatory necessary. motive is not justified necessi- and cannot be ty... business disparate impact employer’s In a case the motive, discriminatory we . Proof of gravamen motives are irrelevant. The of a held, required disparate under a have impact theory. is not theory facially claim under this hiring is that a neutral e.g., passing particular a test criterion — International Bhd. of Teamsters v. United States, meeting height weight require- minimum n.15, 431 U.S. at 335 at 1854 S.Ct. disproportionate impact ments—has a protected on a n.15, omitted). (citations 52 L.Ed.2d at 415 n.15 persons class of in that the criterion majority persons tends to exclude the of the branches, vice First, I branches. One of those complain- do not believe that the at Fairbanks, presented managed by a of sex was a prima ant facie case woman. Moreover, Second, the credit union had been ex- discrimination. even if panding period years. over a By the presented, appears facie case it was time of the hearing Commission this case legitimate, employer did “articulate some the credit union had hired 12 females and nondiscriminatory employee’s reason for the 20 males as at managers 11 of its branches. rejection,” Douglas v. Corp. McDonnell given Commission seems to have no Green, 792,802, 1817,1824, 411 U.S. S.Ct. factors, weight although they those (1973), 36 L.Ed. and that the em- might explain why Commissionmade a ployer’s rejecting reasons for complain- that the credit union’s actions were merely pretext ant were not for discrimi- intentionally willfully discriminato- nation. ry- given by Eckhardt, The reasons Mr. who my opinion In the circumstances of this made hiring were that Fri- give case do not rise to an inference of background drikkson supervision had no unlawful discrimination. The is- statute at management, that until she started with sue be here should not construed to dimin- ten she had not worked for management prerogatives, ish traditional undecided, years, her rotation was date require and it does not an costly it train too her. give preferential treatment to minorities But her lack of experience was the main Weber, females. Steelworkers v. contrast, By factor in not her. hiring Alan 2721, 2728-29, 205-07, 99 Andrews, manager, was who hired as the (1979). L.Ed.2d 490-91 Thus I would completed had college numerous courses in superior reverse court and the determi- business administration and had worked nation the Commission. world, positions. the business albeit in sales One who makes the decision for a

managerial position weigh sort of this must intangible

various factors and arrive at conclusion, upon

overall based the data reading

available. my From of the record it does not appear preferment that the ALASKA, BANK OF a Na NATIONAL Andrews over any pro- Fridriksson was for Association, Banking tional and Alaska Moreover, hibited appears reason. to me Commerce, Banking Bank of a State position might one Mr. Eckhardt’s Association, Appellants, well have rationally, grounds concluded difference, other than sex Andrews Alaska, was qualified. Plainly better simply, STATE of DEPARTMENT OF REVENUE, Appellee. merely decision exercise management sphere of prerogative, a action No. law, into which the even its desire Supreme Court of Alaska. discrimination, in- prevent has no business 2, 1982. April truding.1

Additionally, record shows that at applied

time that Fridriksson posi- for this

tion Alaska USA controlled full four ser- making It is not for the decision. The ultimate focus must courts the Human pass upon judg- Commission to the business be on whether dis- acted with motivation, employer, though judg- criminatory ment of the even not on whether his poor judgment ment seem Tex- erroneous others. business is sound. See Loeb v. employer may nondiscriminatory tron, Inc., (1st An articulate 600 F.2d n.6 Cir. though 1979). reasons his actions even those rea- approved sons would not be if a court were

Case Details

Case Name: Alaska USA Federal Credit Union v. Fridriksson

Court Name: Alaska Supreme Court

Date Published: Mar 26, 1982

Citation: 642 P.2d 804

Docket Number: 5230

Court Abbreviation: Alaska