decided: April 2, 1976; As Amended May 11, 1976.
Appeal from judgment of the United States District Court for the Eastern District of New York, Walter Bruchhausen, Judge, dismissing complaint alleging New York Civil Service Law §§ 80 and 85 regarding seniority and veterans' preferences for demotions due to economic difficulties violates substantive due process, procedural due process, and equal protection and impairs contracts. Affirmed.
Mansfield, Oakes and Van Graafeiland, Circuit Judges.
This appeal presents a multi-pronged attack upon the constitutionality of two sections of the New York Civil Service Law. The first is Section 80*fn1 providing that layoffs and demotions for economic reasons from positions achieved by competitive examination shall be made on the basis of seniority determined by the date of permanent appointment to the classified service generally rather than to the particular position held. The second is Section 85*fn2 giving veterans of World Wars I and II and the Korean and Vietnam Wars certain preferences in retention upon abolition of positions. Appeal is from an order by the United States District Court for the Eastern District of New York, Walter Bruchhausen, Judge, dismissing the complaint*fn3 of certain Transit Authority police captains, lieutenants and sergeants, seeking declaratory and injunctive relief, as well as the convening of a three-judge court. Appellee Yunich is the chairman of the New York City Transit Authority; appellee D'Ambrose is the personnel director and chairman of the New York City Civil Service Commission. Because we believe that appellants can prove under their complaint no set of facts which would entitle them to relief, Conley v. Gibson, 355 U.S. 41, 45-46, 2 L. Ed. 2d 80, 78 S. Ct. 99 (1957), that their constitutional claims are wholly insubstantial and therefore do not require a three-judge court, Goosby v. Osser, 409 U.S. 512, 518, 35 L. Ed. 2d 36, 93 S. Ct. 854 (1973), and that their claims under New York law have been more than adequately disposed of in a state court proceeding initiated after the present federal complaint,*fn4 we affirm the dismissal.
Appellants claim they can or will be*fn5 deprived of four rights guaranteed by the Constitution of the United States: (1) a substantive due process right against arbitrary and capricious denial of property in the form of public employment; (2) a procedural due process right to some kind of hearing before suspension or demotion; (3) an equal protection right to be free from discrimination in demotion or layoff on the basis both of race and color and of merit and fitness, all under the Fourteenth Amendment; and (4) a right, with respect to their pension plans, against impairment of the obligation of contracts under Article I, Section 10. We consider each of the claims separately.
Appellants first argue that Section 80 of the New York Civil Service Law which requires termination by seniority based upon original permanent retention in the civil service, as opposed to seniority based upon tenure in the position currently held, violates substantive due process. This argument cannot be sustained. The substantive due process test applicable since the 1930's in the area of social and economic legislation is whether the challenged law has a rational relation to a valid state objective. Williamson v. Lee Optical of Oklahoma, Inc., 348 U.S. 483, 491, 99 L. Ed. 563, 75 S. Ct. 461 (1955) (prohibition of eye examinations in retail stores rationally related to state objectives of freeing optometrists from taints and temptations of commercialism); Nebbia v. New York, 291 U.S. 502, 529-37, 78 L. Ed. 940, 54 S. Ct. 505 (1934) (price controls of milk rationally related to state objective of protecting consumers and industry, and preventing waste). While one might question the wisdom of a statute such as Section 80 of the New York Civil Service Law which works against a diligent, ambitious officer who rises quickly through the ranks and holds high positions for longer periods than employees who started earlier but are promoted less often, the rationality of rewarding the total length of employment in government service lies beyond the realm of judicial dispute.
Similarly Section 85(7) of the New York Civil Service Law cannot be attacked on substantive due process grounds; it is certainly rational to give veterans retention preference in the event positions are abolished. Russell v. Hodges, 470 F.2d 212, 218 (2d Cir. 1972) (desire to compensate for disruption of previous life and employment and expression of gratitude for service is rational basis for veteran's preference); August v.. Bronstein, 369 F. Supp. 190, 193 (S.D.N.Y.) (three-judge court), aff'd, 417 U.S. 901, 41 L. Ed. 2d 208, 94 S. Ct. 2596 (1974). The preference does not become irrational merely because it exists simultaneously with a state constitutional provision*fn6 allowing certain veterans modest preferential treatment only one in appointments or promotions in civil service.
The claim of lack of procedural due process is also without substance. Relying on what were the lodestar cases of Goldberg v. Kelly, 397 U.S. 254, 25 L. Ed. 2d 287, 90 S. Ct. 1011 (1970), and Fuentes v. Shevin, 407 U.S. 67, 32 L. Ed. 2d 556, 92 S. Ct. 1983 (1972), appellants argue that they are entitled to some kind of hearing before their demotion. But see Mathews v. Eldridge, 424 U.S. 319, 96 S. Ct. 893, 47 L. Ed. 2d 18, 44 U.S.L.W. 4224 (1976); Friendly, " Some Kind of Hearing," 123 U. Pa. L. Rev. 1267 (1975). However, all the employment termination cases cited by appellants, i.e., Arnett v. Kennedy, 416 U.S. 134, 40 L. Ed. 2d 15, 94 S. Ct. 1633 (1974), Burns v. Elrod, 509 F.2d 1133 (7th Cir. 1975), cert. granted, 423 U.S. 821; 96 S. Ct. 33; 46 L. Ed. 2d 37; 44 U.S.L.W. 3200 (1975), and Eley v. Morris, 390 F. Supp. 913 (N.D. Ga. 1975), are concerned with discretionary removal. In such cases Section 75 of the New York Civil Service Law would require notice and hearing. Here we are concerned only with economic demotions which do not involve any exercise of discretion. Appellees are under a statutory mandate. Absent a claim that the seniority computation is based on erroneous factual premises, there is nothing which a hearing would elucidate. In such a situation, it would border on the absurd to hold that appellants may be denied procedural due process, especially in light of the uniform interpretation of Arnett, supra, that a post-termination evidentiary hearing is generally sufficient to protect interests in one's employment meriting due process protection. See Eley v. Morris, supra, 390 F. Supp. at 920, and cases cited therein. See also Mathews v. Eldridge, supra, 44 U.S.L.W. at 4229. Since none of the appellants has as yet been demoted and none therefore has been denied a post-demotion hearing, we need not reach any question pertaining to the requirement of such a hearing in the facts of a particular case.
Appellants' two-pronged equal protection claim is equally without merit.*fn7 Their first argument is that demotion on the basis of civil service seniority will produce a greater adverse impact upon employees of black and other minority groups than would demotion on the basis of seniority determined by tenure in position. This claim is insubstantial on its face because it does not allege why or how the current system would result in greater hardship to minorities than would the former system. Complaints relying on the civil rights statutes are plainly insufficient unless they contain some specific allegations of fact indicating a deprivation of civil rights, rather than state simple conclusions. Powell v. Jervis, 460 F.2d 551, 553 (2d Cir. 1972); Kauffman v. Moss, 420 F.2d 1270, 1275 (3d Cir.), cert. denied, 400 U.S. 846, 27 L. Ed. 2d 84, 91 S. Ct. 93 (1970); Powell v. Workmen's Compensation Board of the State of New York, 327 F.2d 131, 137 (2d Cir. 1964). Since no such facts are alleged here,*fn8 this claim was properly dismissed.
Appellants also claim that they are discriminated against because patrolmen are demoted on the basis of merit and fitness only while they, as sergeants, lieutenants and captains, are demoted not just on the basis of merit and fitness but also on the basis of length of service in a prior position. This claim is totally without merit. Appellants have failed to recognize that Transit Authority patrolmen and officers are all demoted according to seniority in the classified service. The fact, if it is a fact, that patrolmen have generally entered the classified service as patrolmen and therefore have seniority only on the basis of merit and fitness, while their superiors have generally held other positions within the classified service, presumably lower police force positions, is beside the point.
Appellants' final claim is based on the fact that under Article V, Section 7, of the Constitution of the State of New York, "membership in any pension or retirement system of the state or of a civil division thereof shall be a contractual relationship. . . ." Accordingly they argue that by virtue of Article I, Section 10, of the United States Constitution, appellees unconstitutionally threaten to impair their pension rights since any demotion accompanied by a decrease in salary will result in a comparable decrease in their pensions. But the contract clause does not prohibit states from modifying contracts within reason. As the Supreme Court stated in Home Building & Loan Association v. Blaisdell, 290 U.S. 398, 435, 78 L. Ed. 413, 54 S. Ct. 231 (1934):
Not only are existing laws read into contracts in order to fix obligations as between the parties, but the reservation of essential attributes of sovereign power is also read into contracts as a postulate of the legal order. The policy of protecting contracts against impairment presupposes the maintenance of a government by virtue of which contractual relations are worth while, - a government which retains adequate authority to secure the peace and good order of society. This principle of harmonizing the constitutional prohibition with the necessary residuum of state power has had progressive recognition in the decisions of this Court.
See also City of El Paso v. Simmons, 379 U.S. 497, 515, 13 L. Ed. 2d 446, 85 S. Ct. 577 (1965); Lyon v. Flournoy, 271 Cal. App. 2d 774, 76 Cal. Rptr. 869 (1969), appeal dismissed for want of substantial federal question, 396 U.S. 274, 90 S. Ct. 564, 24 L. Ed. 2d 465 (1970) (per curiam) (public employee pensions may be changed). Obviously a salary fixed by a municipal body is a benefit that can be either diminished or increased, and pensions granted in connection therewith may vary accordingly.
Appellants' reliance on Wieman v. Updegraff, 344 U.S. 183, 97 L. Ed. 216, 73 S. Ct. 215 (1952) (loyalty oath for public employees based only on membership unconstitutional), and Slochower v. Board of Higher Education of New York City, 350 U.S. 551, 100 L. Ed. 692, 76 S. Ct. 637 (1956) (summary dismissal of city employees invoking privilege against self-incrimination unconstitutional), is misplaced. While those cases do hold that public employees are protected from exclusion from employment pursuant to a statute that is patently arbitrary or discriminatory, 344 U.S. at 192, 350 U.S. at 556, we have found that Sections 80 and 85(7) are neither. Furthermore, Arnett v. Kennedy, supra, 416 U.S. at 152 (employee may be dismissed for cause pursuant to statutorily created procedure), and Board of Regents of State Colleges v. Roth, 408 U.S. 564, 577, 33 L. Ed. 2d 548, 92 S. Ct. 2701 (1972) (state university may without cause refuse to rehire non-tenured teacher), establish that property interests in employment are created and defined by the statutory or contractual terms thereof. Appellants' property rights in employment with the Transit Authority are therefore defined by the New York Civil Service Law and the rules and regulations pursuant to which appellants were appointed. The state's right to demote for economic reasons as specified in Section 80 of the New York Civil Service Law has been clearly established under New York case law for many years. See People ex rel. Davison v. Williams, 213 N.Y. 130, 107 N.E. 49 (1914) (Cardozo, J.); Felder v. Fullen, 27 N.Y.S.2d 699 (Sup. Ct. 1941), aff'd, 263 App Div. 986, 34 N.Y.S.2d 396, aff'd, 289 N.Y. 658, 45 N.E.2d 167 (1942). Thus, once it becomes necessary, as is here threatened, to demote public employees for reasons of economy, those employees can have no legitimate expectancy or claim of entitlement that seniority be ...