Untitled Texas Attorney General Opinion ( 1978 )

The Attorney General of Texas
----,
June 16, 1978 r-=- Thnic *icic;l I
JOHN L. HILL
Attorney General
Honorable A. R. Schwartz Opinion No. H- 1186
Chairman
Senate Jurisprudence Committee Re: Authority of state agency
State Capitol to enter Into conciliation agree-
Austin, Texas 797ll ment providing back wages to
person who claims employment
discrimination.
Dear Senator Schwartz:
You ask whether certain sections of the Texas-Constitution prohibit a
state agency from agrcelng to pay back wages to persons who claim to have
been subject to employment discrimination in violation of Title VII at the 1964
Civil Rights Act, 42 U.S.C. SS 2000e - 2OOOe-17. A person who believes he
has been terminated or denied employment or promotion on the basis of race,
color, religion, sex, or national origin may file a charge against his employer
with the Equal Employment Opportunity Commission. 42 U.S.C. SS 2OOOe-2,
2000~S(b). If the commission finds reasonable cause to believe that the
charge is true, it will attempt to eliminate unlawful employment racticcs by
informal methods such as conciliation. 42 U.S.C. S 2OOOedb. P Sn cases
where no acceptable conciliation sgreement can be reached, the Attorney
General of the United States or the person aggrieved may sue the state
agencY* 42 U.&C.. S 2OOOe-5(f). If the court finds that the agency has
intentionally engaged In an unlawful employment practice, it may order
rehirimr. backbav. and other eouitable relief. 42 U.S.C. S 2OOOe+(nl:
Albem&le Pap&“& v. Moody, 422 U.S. 405 (1975).
You inquire whether ‘article 3, section 44 of the Texas Constitution
prohibits a state agency from entering into a conciliation agreement
providing back wages to a complainant. Thii provision reads in part:
‘Ihe Legislature . . . shall not . . . grant, by appropria-
tion or otherwise, any amount. of money out of the
Treasury of the State, to any individual, on a claim,
real or pretended, when the same shall not have been
provided for by pre-existing law . . . .
p. 4777
Honorable A. R. Schwartz - Page 2 (H-1186)
This section prevents the legislature from appropriating money to pay any claim
unless some law already in force makes the claim a legal obligation of the state.
Austin National Bank v. Sheppard, 71 S.W.2d 242 (Tex. 1934). Article 3, section 44
reauires %uch an oblization as would form the basis of a judgment azainst the state
in ‘a court of compet&t jurisdiction in the event it should permit itself to be sued.”
Austin National Bank v. Sheppard, s, at 245. A common law right may
constitute “pre-existing law” within article 3, section 44, Austin National Bank v.
Sheppard, s; so may federal law, Attorney General Opinions H-502 (197’S),M-
1155 (19721, M-942 (1971).
In our opinion, Title VII constitutes preexisting law for payment of back
wages to persons who have been the subject of unlawful employment discrimina-
tion. A claim under Title VII can “form the basis of judgment against the state.” It
is thus “pre-existing law” as defined in Austin 71 S.W.2d
242 (Tex. 1934). Once employment discrimination is shown, backpay should be
awarded when necessary to -make victims of discrimination whole. Albemarle
Paper Co. v. Moody, 422 U.S. 405, 421(1975). The absence of bad faith on the part
of the employer is not a sufficient reason to deny backpay. & at 422.
The state may be compelled to pay back wages for violating Title VII even
though it has not consented to be sued. In Fitzpatrick v. Bitzer, 427 U.S. 445
(19761, the Supreme Court held that Title VII authorized individuals to sue a state.
The enforcement provisions of the fourteenth amendment limited the eleventh
amendment and the principles of sovereign immunity it embodies. I& at 456. Thus
the doctrine of sovereign immunity, which ordinarily bars a federal court from
requiring payment to a litigant of funds from the state’s treasury, see Edelman v.
Jordan, 415 U.S. 651 (19741, is inapplicable to Title VII claims. Whenatate agency
isfronted with a well-founded claim of employment discrimination, it can
reasonably expect that the state will ultimately have to pay back wages to the
claimant.
It is clear that article 3, section 44 does not bar the legislature from paying
claims for back wages arising under Title VII. Nor do we believe it bars state
agencies from entering into conciliation agreements to settle such claims. In two
prior opinions, we dealt with the authority of public entities to provide back wages
during suspension or severance pay on termination. Attorney General Opinion H-
402 (1974) involved a county employee who was suspended without pay following
indictment and later reinstated. We determined that the county could not give him
backpay for the period of suspension unless a previously adopted policy authorized
backpay in such situations. We also said:
If, then, a county commissioners court has authority to
hire employees, by implication it has the authority to set the
terms of their employment. One such term which may be
p. 4778
Honorable A. R. Schwartz - Page 3 (R-1186)
possible is that if an employee is indicted he will be
suspended with the understanding that he will be reinstated
with back pay if he is subsequently exonerated. A policy of
this kind would be a condition of employment no different
than the rate of compensation or amount of vacation an
employee is to receive.
Attorney General Opinion H-402 (1974).
In Attorney General Opinion H-786 (1976) we determined that a state
university may adopt a reasonable policy providing severance pay for terminated
employees. So long as this payment of severance pay under this policy constituted
a term or condition of employment, it did not violate article 3, section 44.
We believe the provisions of Title VU constitute terms and conditions of state
employment. See Anderson-Berney Realty Co. v. Saria, 67 S.W.2d 222 (Tex. 1933)
(provisions of Workmen’s Compensation Law become part of employment contract);
Trinity Portland Cement Co. v. Lion Bonding & Surety Co., 229 S.W. 483 (Tex.
Comm’n App. 1921, jdgmt adopted) (provisions of bond statute are by implication
part of public contractors bond). Title VII was amended to cover public
employment in 1972. 42 U.S.C. SS ZOOOe(a),2000e(f); Fitzpatrick v. Bitzer, suck,
at 449. Its requirements and remedies then became part of the individual’s
employment relation with the state, and state agencies acquired policies like those
described in H-402 and H-786, without any need for administrative action on their
part. ln our opinion, state agencies with authority to hire, promote, and fire
employees have implied authority to enter into conciliation agreements providing
for back wages pursuant to the provisions of Title VII.
The individual agency has discretion to decide whether a particular claim
should be settled by agreeing to pay back wages. It has access to the facts of
employment needed to determine whether a particular claim is valid. Federal
cases under Title VII offer guidance as to when a claimant is entitled to back pay
and how it should be computed. See Annot., 21 A.L.R. Fed. 472 (1974); Annot., 5
A.L.R. Fed. 334 (1970) and authorities cited therein. The agency’s appropriation
must be examined to determine whether funds are available to pay back wages.
See Tex. Const. art. 8, S 6; National Biscuit Co. v. State, 135 S.W.2d 687 (Tex.
1946). Appropriations for the regular pay of the employee are available for this
purpose. See Attorney General Opinion M-U55 (1972); see also S. & G. Construction
Co. v. BuRik, 545 S.W.2d 953 (Tex. 1977); Attorney General Opinions H-488 (1975);
H-289 (1974).
We indicated in Attorney General Opinion H-50 (1973) that state agencies
may not make conciliation agreements unless they have express statutory authority
p. 4779
Honorable A. R. Schwartz - Page 4 (~-1186)
to do so. In light of the 1976 Supreme Court decision of Fitzpatrick v. Bitzer,
supra, we now believe the view adopted in Attorney General Opinion H-50 is
incorrect. In 1973 we could reasonably assume that the state would not be liable
for Title VII claims without legislative consent. See Employees of the Department
of Public Health & Welfare v. Department of PubzHealth & Welfare, 411U.S. 279
(1973). We therefore looked for a clear sign of legislative intent to make the state
liable for backpay, such as an express grant of authority to settle claims. See
V.T.C.S. art. 6252-19, S 10. Fitzpatrick v. Bitzer, however, nullified our ma
reason for requiring express statutory authority to enter into conciliation
agreements. Attorney General Opinion H-50 is overruled to the extent inconsistent
with this opinion.
You also ask whether article 3, section 51 of the Texas Constitution prohibits
a state agency from entering into a Title VII conciliation agreement providing for
the payment of back wages. Article 3, section 51 provides in part:
The Legislature shalI have no power to make any grant or
authorize the making of any grant of public moneys to any
individual, association of individuals, municipal or other
corporations whatsoever. . . .
The purpose of this provision is to prevent the gratuitous grant of public funds to
any person. State v. City of Austin, 331 S.W.2d 737 (Tex. 1960).
Article 3, section 51 is not violated by the payment of a claim for which the
state is liable. g at 742. See Harris County v. Dowlearn, 489 S.W.2d 140 (Tex.
Civ. App. - Houston [14th Disn 1976, writ ref’d n.r.e.l (compensation of individual
pursuant to Texas Tort Claims Act does not violate article 3, section 51); Stacy v.
Bridge City Independent School District, 357 S.W.2d 618 (Tex. Civ. A@p. -
Beaumont 1962, no writ) (payment of fuII salary to wrongfully discharged teacher
does not violate article 3, section 511. See also Attorney General Opinions H-786
(19761; H-402 (19741. In our opinion, the payment of back wages pursuant to a
conciliation agreement settling a claim under Title VII does not contravene article
3, section 5L
SUMMARY
Sections 44 and 51 of article 3 of the Texas Constitution do
not bar state agencies from entering into conciliation
agreements providing back wages to a person who asserts a
valid claim of employment discrimination under Title VII of
the 1964 Civil Rights Act.
P. 4780
. L
Honorable A. R. Schwartz - Page 5 (H-1186)
Very truly yours,
Attorney General of Texas
Opinion Committee
jsn
p. 4781