## Facts

- Construction-industry employers and trade associations in Eastern Pennsylvania and Delaware entered collective-bargaining agreements with a union establishing an exclusive hiring hall for operating engineers.
- Workers obtained job referrals largely through the union’s referral system and through an apprenticeship program administered by a joint apprenticeship and training committee (JATC) composed of union and trade-association appointees.
- Minority workers sued, alleging racial discrimination in access to referrals and apprenticeship opportunities affecting employment in the industry.
- The district court found intentional discrimination by the union in administering the hiring hall and similar discrimination by the JATC in administering the apprenticeship program.
- The district court found the employers, as a class, did not intentionally discriminate and were not aware of the union’s discriminatory conduct.
- Despite the absence of employer intent or knowledge, the district court held the employers and associations liable under 42 U.S.C. § 1981 for purposes of injunctive relief and ordered detailed remedial measures, including utilization goals, reporting, and cost-sharing.
- The court of appeals affirmed the imposition of employer liability and the injunctive decree.

## Issues

1. Whether liability under 42 U.S.C. § 1981 may be imposed without proof of intentional racial discrimination.
2. Whether employers and employer associations that neither intended nor knew of the union’s discrimination may be held liable under § 1981 based on respondeat superior or a “nondelegable duty” theory arising from use of an exclusive hiring hall.
3. Whether parties not liable under § 1981 may nonetheless be required to pay a share of the costs of implementing injunctive relief directed at other defendants’ discrimination.

## Decision

- The Supreme Court reversed the judgment imposing § 1981 liability on the employers and employer associations and remanded.
- The Court held § 1981 liability may not be imposed without proof of intentional discrimination; disparate impact alone is insufficient.
- The Court rejected imposing § 1981 liability on the employers solely because they bargained for an exclusive hiring hall later administered discriminatorily by the union, absent proof that the employers themselves intentionally discriminated or that traditional agency elements supported vicarious liability.
- The Court held that nonliable parties may not be assessed a proportionate share of the costs of implementing a remedial decree aimed at correcting another party’s unlawful discrimination.

## Legal Principles

- 42 U.S.C. § 1981 reaches purposeful racial discrimination in contracting; proof of intent is required.
- A private party’s participation in a contractual arrangement (such as an exclusive hiring hall) does not by itself establish intentional discrimination under § 1981.
- Vicarious liability under § 1981 requires a properly supported agency relationship; it is not established merely by delegation of hiring to a union.
- § 1981 does not impose a freestanding “nondelegable duty” on employers to guarantee nondiscriminatory union referral decisions.
- Equitable relief may be broad against violators, but remedial cost shifting and structural obligations cannot be imposed on parties not found liable for a statutory violation.

## Conclusion

The Court limited § 1981 to intentional racial discrimination, rejected employer liability theories untethered to employer intent or established agency, and barred assessing remedial implementation costs against parties not legally responsible for the discrimination.


Gen. Bldg. Contractors Ass’n v. Pennsylvania, 458 U.S. 375 (1982)