Document Type

Article

Disciplines

International Law

Abstract

The United States emerged from World War II as the world's dominant economic power. In this period of dominance, the United States entered into a series of treaties, which it initiated "in support of American citizens and their assets abroad."' Then almost twenty years after the United States embarked upon its treaty program, Congress enacted the Civil Rights Act of 1964, whose centerpiece, Title VII [hereinafter Title VII], prohibited discrimination in employment on the basis of race, sex, religion, and national origin.' There is nothing in the legislative history of Title VII to indicate that Congress considered the effect of Title VII on existing commercial treaties.' Nor could the authors of the treaties or the Act have predicted the current political and economic situation, where foreign corporations are expanding into American markets more successfully than American corporations are expanding overseas, and white, as well as minority Americans are sometimes considered second-class employees.

It is ironic that foreign corporations operating in the United States are using treaty language written by Americans to deny Americans equal employment opportunities. American employees of these foreign corporations who experience discrimination must seek redress in laws which either may not reach the alleged wrongdoer due to treaty immunity, or are not designed to treat the problem of discrimination against Americans as a class.6 The Supreme Court discussed this problem at length in Sumitomo Shoji America, Inc. v. Avagliano,6 but decided that issue on other grounds, leaving the exact relationship between Title VII and certain Treaties of Friendship, Commerce and Navigation [hereinafter FCN] unresolved. Since the Sumitomo decision, a great deal has been written about the problem of reconciling a foreign corporation's treaty rights with their American employees' rights under state and federal anti-discrimination laws. Many solutions have been suggested,7 but until the Supreme Court rules on the exact relationship between treaty rights and employee's rights, lower courts must weigh all these proposed solutions to formulate their own response to this question..

In MacNamara v. Korean Air Lines,' the Third Circuit Court of Appeals attempted to reconcile the competing legal interests of an American employee and the foreign corporation that employed him. To accomodate the rights of the foreign employer, the court held that citizenship discrimination, which is not explicitly. prohibited by Title VII, and national origin discrimination are "distinct phenomena," against the accumulated wisdom of courts, commentators, and federal enforcement agencies, who have all noted that citizenship discrimination is often indistinguishable from race. and national origin discrimination." The MacNamara court also held that American employees cannot base their claims of employment discrimination against a foreign corpora-, tion exercising its treaty rights on the disparate impact theory, one of the two major theories of litigation in employment discrimination law.

This note argues that the Third Circuit erred in both holdings. After consideration of the background of FCN treaties and theories of litigation under Title VII laws, this note proposes that courts should adopt the analytic approach first suggested by the Government in its amicus brief in Sumitomo,1" the only case considering the relationship between FCN Treaty rights and Title VII to reach the Supreme Court. In the Government's analysis, foreign corporations must meet charges of discrimination under the disparate impact theory with the business necessity defense, an approach consistent with the original design of the Treaty and the demands of Title VII. Alternatively, courts could choose the most narrow definition of the term "executive" to confine the Treaty privilege to a narrow class of highly placed employees, or they could hold that this treaty privilege has been implicitly repealed by the subsequent civil rights legislation.

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