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Alfred Engineering v. Ill. Fair Emp. Prac. Com.

MAY 27, 1974.

ALFRED ENGINEERING, INC., ET AL., PLAINTIFFS-APPELLEES,

v.

ILLINOIS FAIR EMPLOYMENT PRACTICES COMMISSION ET AL., DEFENDANTS-APPELLANTS.



APPEAL from the Circuit Court of Sangamon County; the Hon. HOWARD LEE WHITE, Judge, presiding.

MR. JUSTICE CRAVEN DELIVERED THE OPINION OF THE COURT:

This case is here upon an interlocutory appeal from an order of the circuit court of Sangamon County granting a preliminary injunction against the Illinois Fair Employment Practices Commission and its individual members, restraining the enforcement of certain rules and regulations of the Commission with reference to an affirmative action program relating to public contracts. We reverse and remand with directions to dismiss the complaint for want of equity.

A complaint in chancery and for declaratory judgment was filed in the circuit court on March 30, 1973, alleging that the Commission had promulgated certain rules and regulations, the substantive effect of which was to require bidders, contractors, and sub-contractors to undertake certain affirmative action programs with reference to minority employment in connection with contracts for State goods and services. The complaint purported to be filed on behalf of the listed plaintiffs and all other contractors similarly situated; in short, it purported to be a class action.

On the same day, a motion for a temporary restraining order was filed; the motion was allowed, and the court ordered an injunction to issue, without bond or notice, restraining the enforcement of the rules and regulations and setting a motion for a preliminary injunction for a hearing on April 10, 1973. On April 6, a motion was filed to vacate the temporary restraining order. Thereafter, on April 10, a preliminary injunction was issued of the same substantive effect as the original temporary restraining order. Upon appeal, this court entered an order staying the force and effect of the preliminary injunction. This interlocutory appeal follows.

Essentially, the complaint upon which the extraordinary injunctive relief was granted by the trial court sought a declaratory judgment and an injunction barring the enforcement of the rules and regulations which were alleged to be in excess of the statutory authority of the Commission, arbitrary, discriminatory, overly vague and oppressive; and an attempt to establish unlawful and unconstitutional procedure for bidding on State construction contracts, and, finally, an invasion of a federally preempted field. Plaintiffs and all of the class which they purport to represent are employers and contractors or subcontractors as defined in the attacked rules. Plaintiffs and the class they represent are described as ones who would seek construction contracts with the State and who have been awarded past construction contracts with the State upon State construction bids with a value in excess of $500 million.

The rules and regulations provide for affirmative action to eliminate discrimination in the construction industry and are purportedly promulgated pursuant to sections 4 and 4A of the Illinois Fair Employment Practices Act (Ill. Rev. Stat. 1973, ch. 48, ¶¶ 854, 854A):

"Public Contracts. Every contract to which the State, any of its political subdivisions or any municipal corporation is a party shall be conditioned upon the requirement that the supplier of materials or services or the contractor and his subcontractors, and all labor organizations furnishing skilled, unskilled, and craft union skilled labor, or who may perform any such labor or services, as the case may be, shall not commit an unfair employment practice in this State as defined in this Act. To the full extent to which the State may have authority with respect to such contracts, this Section shall be applicable.

Rules and regulations. The Commission shall have the authority to issue rules and regulations for the purposes of enforcement and administration of Section 4 of this Act and rules and regulations adopted hereunder. All rules and regulations adopted under this Section shall be consistent with Section 4.

No contract shall be awarded by the State to any employer found by the Commission to have violated its rules and regulations until the Commission shall certify that the violation has ceased. For each violation that occurs there may be deducted from the amount payable to the contractor by the State of Illinois a penalty of $5 for each calendar day that the violation persists. Further, the State, any of its political subdivisions or any municipal corporation may avoid any such contract at its option and it may sue and shall recover the profits earned on such contract. Added by P.A. 77-1552, § 1, eff. Sept. 17, 1971."

An allegation in the complaint is to the effect that the rules and regulations are beyond the authority of the Commission, it being the contention of the plaintiffs that the Commission is limited to rules and regulations with reference to specific statutorily defined unfair employment practices. Section 3 of the Act does provide that nothing in the Act shall preclude an employer from hiring or selecting between persons for any reason except for the unfair employment practices specifically prohibited by the Act. Thus, in substance, the plaintiffs contend that there is no statutory authority for the Commission to undertake affirmative action plans since discriminatory employment is an unfair employment practice by statute and under-utilization of minorities and women is not an unfair employment practice. The relevant rules and regulations are:

SECTION 2.6. The term "Contractor" means any person who bids or applies for, who is considered for, or who has been awarded a contract by a contracting agency either through a competitive bidding procedure or otherwise.

Section 2.9. The term "Responsible" describes any person who conforms to the Equal Employment Opportunity requirements of these Rules and Regulations and is therefore eligible to bid on or be awarded a contract or subcontract.

Section 2.13. The term "underutilization" means having fewer minorities or women in a particular job classification than would reasonably be expected by their availability.

Section 3.1. Each contracting agency shall insure that every contract to which it is a party shall contain the following clause:

EQUAL EMPLOYMENT OPPORTUNITY

In the event of the contractor's noncompliance with any provision of this Equal Employment Opportunity Clause, the Illinois Fair Employment Practices Act or the Fair Employment Practices Commission's Rules and Regulations for Public Contracts, the contractor may be declared non-responsible and therefore ineligible for future contracts or subcontractors with the State of Illinois or any of its political subdivisions or municipal corporations, and the contract may be cancelled or avoided in whole or in part, and such other sanctions or penalties may be imposed or remedies invoked as provided by statute or regulation.

During the performance of this contract, the contractor agrees as follows:

(1) That it will not discriminate * * * and that it will examine all job classifications to determine if minority persons or women are underutilized and will take appropriate ...


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