On Appeal from the United States District Court for the Western District of Pennsylvania (Pittsburgh), D.C. Civil Action No. 83-977.
Higginbotham, Scirica and Hutchinson, Circuit Judges.
A. LEON HIGGINBOTHAM, JR., Circuit Judge.
This is an appeal from the judgment of the district court in favor of an employer alleged to have violated the Age Discrimination in Employment Act, 29 U.S.C. §§ 621-634 (1982) ("ADEA"), by its termination of the Appellant's employment. Appellant asserts that the district court committed error by refusing to grant his motion to amend his complaint, and by concluding that Appellant's execution of a claim release form, in order to obtain pension benefits, constituted a "voluntary and knowing" waiver of his claims under the ADEA and thus, that the employer's failure to pay those benefits when the Appellant refused to withdraw his age discrimination complaint did not constitute retaliation in contravention of the ADEA.
We conclude that Appellant's motion to amend his complaint was improperly denied. Accordingly, we will vacate the district court's order and remand with instructions that the motion to amend be granted. Further, we hold that the circumstances under which Appellant signed the release form do not evidence the requisite knowledge by the Appellant to constitute a knowing and willful waiver of his claims. We will, therefore, reverse the district court's finding to the contrary and remand for rehearing on the claim of retaliation.
We are once again presented with the task of interpreting the ADEA in a manner that effectuates Congress's intent to proscribe discrimination against older persons because of age, and also provides reasonable latitude to employers in the management of their businesses. Appellant, Ronald Hallas,*fn1 began his employment with Appellee, the United States Steel Corporation ("USS") in 1947 as a laborer in USS's Coke and Chemical Production facility in Clairton, Pennsylvania ("Clairton Works"). During the more than 35 years of his employment with USS, Hallas worked in various job capacities and received several merit-based salary increases and promotions. In July, 1982 he was laid off during a reduction in force attributed to a major cutback of operations at the Clairton Works. At that time, Hallas was employed as a foreman within the chemicals department. In August, 1982, Hallas filed a charge with the Equal Employment Opportunity Commission in which he alleged that he had been selected for lay-off because of his age, and that USS had retained a number of younger employees to do jobs that Hallas had performed or was qualified to perform.
In or about late October, 1982, Hallas was advised by the assistant superintendent of the Clairton Works that USS was permanently terminating his employment. Jt. App. at 64. He was also told that, in light of his service with USS, he would qualify for the so-called "70/80" mutual agreement pension benefit*fn2 if he would execute a form entitled "Application and Release for 70/80 Retirement Under Mutually Satisfactory Conditions," which was commonly referred to as the "PF-116-B." The PF-116-B contained a release of all claims that an employee had against USS pursuant to the ADEA and a waiver of any such claims that might in the future be determined to exist.*fn3 It provided that the employee would "not file or permit to be filed on [his or her] behalf any such claim." Jt. App. at 157. Further, it provided that the employee would "not permit [himself or herself] to be a member of any class seeking relief and [would] not counsel or assist in the prosecution of claims against the releases, whether those claims are on behalf of [him or her] or others." Id. The form also stated that "if any such claim has been filed by [the signing employee] or included [him or her] in its coverage for relief, [he or she] agree[d] to voluntarily withdraw such claim and otherwise agree[d] not to participate in such claim." Id.
Hallas was instructed to schedule a meeting with a representative of USS's personnel department to discuss the options available to him regarding his separation from the company. On November 2, that meeting occurred between Hallas and Robert Yost. Yost advised Hallas that Hallas qualified for the 70/80 mutual option pension, but that he could not elect that option without executing the PF-116-B release. Although Hallas expressed his desire to become eligible for the pension option, he refused to sign the PF-116-B. Hallas later testified that he refused to sign the form because he had doubts about its legality. Jt. App. at 94. The meeting between Hallas and Yost concluded without resolution of Hallas's pension entitlement. On November 11, Hallas returned to USS and met with the general supervisor of personnel training, Robert Wilson, who advised Hallas that the only options available to him were accepting the 70/80 pension (and signing the PF-116-B) or being placed on a two-year lay-off. Jt. App. at 88. Wilson advised Hallas that if he chose the latter option, in addition to not receiving any compensation from USS during the lay-off, his hospitalization coverage would cease. Id. Moreover, Wilson told Hallas that he would be required to accept any job that became available during the lay-off period. At the conclusion of his meeting with Wilson, Hallas signed the election form for the 70/80 pension but again refused to sign the PF-116-B. See Jt. App. at 87-88. On November 19, he amended his discrimination charge with the EEOC to include an allegation regarding the requirement that employees sign the PF-116-B as a condition to 70/80 pension eligibility. (See Jt. App. at 77, 80-81, 94, 160). On November 29, Hallas returned to USS and met again with Wilson. At this meeting, he signed the PF-116-B form and was advised that he would begin receiving the pension.
Nearly two months followed during which Hallas did not receive any pension benefits or other compensation from USS. In late January, 1983, Hallas contacted the USS personnel office to inquire about the status of his pension and was told by Wilson that USS had reconsidered its decision to offer Hallas the 70/80 plan because Hallas had failed to withdraw his age discrimination complaint. Jt. App. at 89, 108.
In or about June, 1983, Hallas "opted in" as a party plaintiff in an action that had been previously filed by James Coventry, also a former employee at USS, that alleged various violations of the ADEA. That class action was subsequently severed into discrete groups and the actions tried separately. After discovery and pretrial pleadings, a bench trial of the claims raised by the group to which Hallas had been assigned began on February 5, 1987. The trial concluded on that same day and, approximately three weeks later, a verdict in favor of USS was entered on February 23, 1987. In its decision, the district court concluded that, although Hallas had established a prima facie case of age discrimination, he had failed to demonstrate that the non-discriminatory reason that USS had asserted for his discharge was pretext. Coventry v. United States Steel, No. 83-977 (W.D. Pa. Feb. 23, 1987) slip op. at 4-5, reprinted in Jt. App. at 161-62.
Hallas now appeals from that verdict. He alleges that the district court erred first by refusing to allow him to amend his complaint in July 1986 to allege that USS's pension policy contravened the provisions of the ADEA. He also asserts that the district court's conclusion that he had executed a valid waiver of ADEA claims was erroneous. We have reviewed each of these contentions and conclude that the decision of the district court ...