FOR PUBLICATION
 UNITED STATES COURT OF APPEALS
      FOR THE NINTH CIRCUIT

NOREEN HULTEEN; ELEANORA              
COLLET; LINDA PORTER; ELIZABETH
SNYDER; COMMUNICATIONS                     No. 04-16087
WORKERS OF AMERICA,
              Plaintiffs-Appellees,         D.C. No.
                                          CV-01-01122-MJJ
               v.                            OPINION
AT&T CORPORATION,
             Defendant-Appellant.
                                      
       Appeal from the United States District Court
         for the Northern District of California
        Martin J. Jenkins, District Judge, Presiding

             Argued and Submitted En Banc
        October 4, 2006—San Francisco, California

                   Filed August 17, 2007

     Before: Mary M. Schroeder, Chief Circuit Judge,
      Stephen Reinhardt, Diarmuid F. O’Scannlain,
       Pamela Ann Rymer, Michael Daly Hawkins,
        Susan P. Graber, M. Margaret McKeown,
       Kim McLane Wardlaw, William A. Fletcher,
 Raymond C. Fisher, Ronald M. Gould, Richard A. Paez,
Marsha S. Berzon, Jay S. Bybee, and Consuelo M. Callahan,
                      Circuit Judges.

                Opinion by Judge Wardlaw;
               Dissent by Judge O’Scannlain




                           10025
10028         HULTEEN v. AT&T CORPORATION


                       COUNSEL

Joseph R. Guerra, Sidley Austin Brown & Wood, Washing-
ton, District of Columbia, for the defendant-appellant.

Henry S. Hewitt, Erickson, Beasley, Hewitt & Wilson, Oak-
land, California, and Blythe Michelson and M. Suzanne Mur-
                HULTEEN v. AT&T CORPORATION                10029
phy, Weinberg, Roger & Rosenfeld, Oakland, California, for
the plaintiffs-appellees.

Paul D. Ramshaw, Equal Employment Opportunity Commis-
sion, Washington, District of Columbia, amicus curiae.


                          OPINION

WARDLAW, Circuit Judge, with whom Chief Judge
SCHROEDER, Judges REINHARDT, HAWKINS, GRA-
BER, McKEOWN, W. FLETCHER, FISHER, GOULD,
PAEZ, BERZON join, and with whom Judge RYMER joins
as to Part II-B:

   This appeal presents an issue previously decided on virtu-
ally identical facts sixteen years ago in Pallas v. Pacific Bell,

(9th Cir. 1991), cert. denied, 

(1992). There, we held that Pacific Bell violated Title VII in
calculating retirement benefits after the effective date of the
Pregnancy Discrimination Act of 1978 (“PDA”), 42 U.S.C.
§ 2000e(k), when it gave service credit in those calculations
for all pre-PDA temporary disability leave taken by employ-
ees except leave by reason of pregnancy. 

. Here, a three-judge panel of our court, in a now-
withdrawn opinion, held that AT&T Corporation (“AT&T”),
successor in interest to Pacific Bell and Pacific Telephone and
Telegraph (“PT&T”), did not violate Title VII by engaging in
identical conduct. The panel reasoned that Pallas no longer
controlled because it was inconsistent with intervening
Supreme Court authority governing retroactivity principles.
Hulteen v. AT&T Corp., 

, 664 (9th Cir. 2006)
(citing Landgraf v. USI Film Prods., 

(1994)).
Because we conclude that Pallas is not “clearly irreconcil-
able” with intervening authority, see Miller v. Gammie, 

, 900 (9th Cir. 2003) (en banc), we affirm the district
court’s application of Pallas to the undisputed facts presented
10030           HULTEEN v. AT&T CORPORATION
here and its award of summary judgment against AT&T. We
further hold that our conclusion in Pallas that calculation of
service credit excluding time spent on pregnancy leave vio-
lates Title VII was, and is, correct.

                               I

   Noreen Hulteen, Eleanora Collet, Linda Porter, Elizabeth
Snyder and the Communications Workers of America, AFL-
CIO (collectively “Hulteen”), brought this suit to challenge
AT&T’s use of a facially discriminatory service credit policy
to calculate employee pension and retirement benefits. Each
of the individual plaintiffs took pregnancy leave between
1968 and 1976. They would have enjoyed more favorable
benefits or retirement opportunities had they, at the time that
they parted from AT&T, been given full service credit for
their pre-PDA pregnancy leaves.

   Congress passed the PDA in 1978. Amendments to the
Civil Rights Act of 1964, Pub. L. No. 95-555, § 995, 92 Stat.
2076 (1978). The PDA clarified that Title VII prohibits dis-
crimination “because of or on the basis of pregnancy, child-
birth, or related medical conditions,” as discrimination
“because of sex.” 42 U.S.C. § 2000e(k). The PDA further pro-
vides that “women affected by pregnancy, childbirth, or
related medical conditions shall be treated the same for all
employment-related purposes, including receipt of benefits
under fringe benefit programs, as other persons not so
affected but similar in their ability or inability to work.” 

VII, as amended by the PDA, requires employers
to accord women who take pregnancy leave the same benefits
as employees who take other types of temporary disability
leave.

  From as early as 1914, AT&T, along with its predecessor
companies PT&T and Pacific Bell, has used a Net Credited
Service (“NCS”) date to calculate employee benefits, includ-
ing eligibility for early retirement and pension payment
                HULTEEN v. AT&T CORPORATION                10031
amounts. The NCS date is an employee’s original hire date,
adjusted forward in time for periods during which no service
credit accrued. An earlier NCS date places an employee in a
superior position for service-related determinations such as
job bidding, vacation time and retirement benefits.

   Before August 7, 1977, AT&T and its predecessor compa-
nies classified pregnancy leave as personal leave. An
employee on personal leave received a maximum of thirty
days NCS credit, whereas there was no limit on the amount
of NCS credit for employees on temporary disability leave.
Also, during that time, some female employees were forced
to take pregnancy leave before the onset of pregnancy disabil-
ity, even though other employees who anticipated a temporary
disability could delay their leave until the onset of the disabil-
ity. Employees on pregnancy leave who subsequently became
temporarily disabled for reasons unrelated to pregnancy were
ineligible for NCS credit beyond the thirty-day personal leave
credit. By contrast, employees on temporary disability leave
who suffered a new disability were eligible for NCS credit for
the entire leave.

   On August 7, 1977, PT&T adopted the Maternity Payment
Plan (“MPP”). The MPP extended the maximum pregnancy
NCS credit to thirty days before delivery and a maximum of
six weeks after delivery. The MPP also allowed pregnant
employees to work until the onset of the pregnancy disability.
On April 29, 1979, the effective date of the PDA, PT&T
adopted the Anticipated Disability Plan (“ADP”). The ADP
replaced the MPP and provided service credit for pregnancy
leave on the same terms as other temporary disability leave.
No service credit adjustments or changes to the NCS date
were made for female employees who had taken pregnancy
leave under either the MPP or the pre-1977 system. In 1984,
ownership of PT&T was transferred to AT&T. The NCS
credit calculation method described above remains in force at
AT&T, notwithstanding AT&T’s operations within the Ninth
Circuit and our controlling decision in Pallas.
10032               HULTEEN v. AT&T CORPORATION
   Noreen Hulteen retired involuntarily in 1994 as part of an
AT&T reduction in force. She has 210 days of uncredited
pregnancy leave that resulted in reduced pension benefits.
Eleanora Collet retired voluntarily under an incentive pro-
gram in 1998 with 261 days of uncredited pregnancy leave.
Linda Porter is a current employee with seventy-three uncred-
ited days from pregnancy leave and forced leave before the
onset of her pregnancy disability.1 Elizabeth Snyder termi-
nated her employment voluntarily in 2000, and has sixty-
seven days of uncredited pregnancy and unrelated temporary
disability occurring during her pregnancy leave. The AT&T
plan administrator, in 2000, authorized a credit for Snyder’s
first thirty days of her 1974 pregnancy leave “as was the pol-
icy at the time,” changing her NCS date from July 29, 1966
to June 29, 1966.2

   Between 1994 and 2002, each woman filed a charge with
the United States Equal Employment Opportunity Commis-
sion (“EEOC”). CWA likewise filed a charge of discrimina-
tion with the EEOC on behalf of its bargaining unit
  1
     We have jurisdiction to entertain Porter’s claim even though the illegal
employment action — her calculation of benefits — is yet to occur. When
a plaintiff seeks declaratory and injunctive relief, as Porter has here, ripe-
ness is evaluated by examining “whether the facts alleged, under all the
circumstances, show that there is a substantial controversy, between par-
ties having adverse legal interests, of sufficient immediacy and reality to
warrant the issuance of a declaratory judgment.” Md. Cas. Co. v. Pac.
Coal & Oil Co., 

, 273 (1941); see also 42 U.S.C. § 2000e-
5(g)(1) (If an employer “is intentionally engaging in an unlawful employ-
ment practice charged in the complaint, the court may enjoin the
[employer] from engaging in such unlawful employment practice.”).
Given AT&T’s truculent refusal to credit employees for their pre-PDA
pregnancy leave in its benefits calculations as it credits other disability
leave (notwithstanding our decision in Pallas), Porter faces a real and
immediate threat of AT&T making discriminatory employment decisions
based on her NCS date.
   2
     The remaining appellee, Communications Workers of America
(“CWA”), is the collective bargaining representative for the majority of
AT&T’s non-management employees.
                HULTEEN v. AT&T CORPORATION                10033
employees. The EEOC issued a Letter of Determination find-
ing reasonable cause to believe that AT&T had discriminated
against Noreen Hulteen “and a class of other similarly-
situated female employees whose adjusted [NCS] date has
been used to determine eligibility for a service or disability
pension, the amount of pension benefits, and eligibility for
certain other benefits and programs, including early retire-
ment offerings.” The EEOC also issued a Notice of Right to
Sue to each of the four named plaintiffs and CWA.

   Hulteen brought suit, alleging, inter alia, that AT&T vio-
lated Title VII in its calculation of NCS credit. On cross-
motions for summary judgment, the parties stipulated to all of
the material facts. Applying Pallas, the district court granted
Hulteen’s motion for summary judgment on the Title VII
claim. AT&T timely appealed, and on March 8, 2006, a panel
of our court reversed the district court, holding that Pallas
gave “the PDA impermissible retroactive effect under control-
ling law today.” 

. Judge Rymer dis-
sented, arguing that because there appears to be “no
acceptable basis . . . to overrule Pallas, and AT&T offers no
reason for distinguishing it, . . . Pallas remains binding and
controls disposition of this case.” 

A majority of the
active judges of this court voted in favor of rehearing en banc.
We consider the appeal anew.

                               II

  We review de novo the district court’s grant of summary
judgment. Qwest Commc’ns, Inc. v. City of Berkeley, 

, 1256 (9th Cir. 2006). “We must determine, view-
ing the evidence in the light most favorable to [AT&T], the
non-moving party, whether . . . the district court correctly
applied the substantive law.” Olsen v. Idaho State Bd. of
Med., 

, 922 (9th Cir. 2004).

                                A

   [1] The district court correctly held that our decision in Pal-
las compels the conclusion that AT&T violated Title VII by
10034              HULTEEN v. AT&T CORPORATION
failing to credit pre-PDA pregnancy leave when it calculated
benefits owed Hulteen. Lana Pallas was a former Pacific Bell
employee who took pregnancy leave before the PDA was
enacted. 

. “In 1987, Pacific Bell insti-
tuted a new retirement benefit for management employees
called the ‘Early Retirement Opportunity.’ ” 

To
qualify for the benefit, an eligible employee had to accrue
twenty years of service as measured by the same NCS system
applied to Hulteen. 

denied eligibility because
a pregnancy-related leave taken in 1972 deprived her of the
necessary amount of service credit by some three or four
days. 

court dismissed Pallas’s Title VII sex discrimi-
nation claim for failure to state a claim, and we reversed.
In doing so, we criticized reliance on the Supreme Court’s
decisions holding that challenges based on disparate impacts
resulting from a facially neutral bona fide seniority system
must be brought during a limitations period running from the
date the system was adopted. 

(citing Lorance
v. AT&T Techs., Inc., 

, 911 (1989) (holding that
“when a seniority system is nondiscriminatory in form and
application, it is the allegedly discriminatory adoption which
triggers the limitations period”) (emphasis in original), and
United Air Lines, Inc. v. Evans, 

, 557-58
(1977)3).
   3
     Evans worked as a United Air Lines flight attendant for eighteen
months, until she married in 1968 and was forced to resign pursuant to
United’s policy of prohibiting its female flight attendants from being mar-

. While this policy was later found to violate Title
VII, Evans was not a party to that suit. 

In 1972, four years
after her resignation, United hired Evans as a new employee. 

Evans was not credited for her previous service pursuant to a new policy
prohibiting prior seniority credit from being given to flight attendants,
regardless of sex, if they resigned or their employment was “permanently
severed for just cause.” 

n.6. Evans filed suit, seeking an award
of seniority credit to 1966 and back pay lost because of United’s discrimi-
natory no marriage policy. 

& n.7. The Court found United’s
                   HULTEEN v. AT&T CORPORATION                       10035
  We found Lorance and Evans inapposite for two reasons.
First, because the discriminatory program that gave rise to the
lawsuit was instituted in 1987, Pallas’s claim “could not have
been brought earlier.” 

concluded that, unlike the facially neutral
seniority credit policy in Evans,

     the net credit system used to calculate eligibility
     under the Early Retirement Opportunity is not
     facially neutral. The system used to determine eligi-
     bility facially discriminates against pregnant women.
     The system distinguishes between similarly situated
     employees: female employees who took leave prior
     to 1979 due to a pregnancy-related disability and
     employees who took leave prior to 1979 for other
     temporary disabilities.

We therefore held, relying on Bazemore v. Fri-
day, 

(1986), that Pacific Bell’s decision to dis-
criminate against Pallas in 1987 was actionable because
“liability may be imposed” for a pre-Title VII discriminatory
policy to the extent it is perpetuated in post-Title VII employ-
ment decisions. 

(citing 

(Brennan, J., joined by all other Members of

1972 policy was facially neutral because “both male and female employ-
ees who had service prior to February 1968, who resigned or were termi-
nated . . . and who were later re-employed, also were treated as new
employees receiving no seniority credit for their prior service.” 

The Court held that the application of the facially neutral policy, which
gives present effect to the past discriminatory act of forced resignation for
married female flight attendants in 1968, was not actionable. 

   4
     Evans would be controlling if Pacific Bell credited neither pre-PDA
pregnancy leave nor pre-PDA disability leave when it made its early
retirement determinations in 1987. The dissent, by blurring the distinction
between facially neutral and facially discriminatory employment policies,
inappropriately relies on Evans. See Dissent Op. at 10069-70.
10036              HULTEEN v. AT&T CORPORATION
the Court, concurring in part) (“Each week’s paycheck that
delivers less to a black than to a similarly situated white is a
wrong actionable under Title VII, regardless of the fact that
this pattern was begun prior to the effective date of Title
VII.”)).

   The Court recently reaffirmed Bazemore in Ledbetter v.
Goodyear Tire & Rubber Co., 

, 2172-74 (2007).5
The Court distinguished Bazemore on the basis of Ledbetter’s
failure to show that her disparate treatment was the result of
intentional discrimination during the charging period. 

The Court reiterated that “a freestanding violation may
always be charged within its own charging period regardless
of its connection to other violations.” 

Bazem-
ore as holding:

      when an employer adopts a facially discriminatory
      pay structure that puts some employees on a lower
      scale because of race, the employer engages in inten-
      tional discrimination whenever it issues a check to
      one of these disfavored employees. An employer that
      adopts and intentionally retains such a pay structure
      can surely be regarded as intending to discriminate
      on the basis of race as long as the structure is used.

Pallas is true to Bazemore and Ledbetter: Pacific
Bell adopted a policy that calculates pregnancy leave differ-
ently than other temporary disability leave, and it engages in
intentional discrimination each time it applies the policy in a
  5
    Ledbetter, as the Court’s most recent pronouncement on Title VII, is
relevant, but does not control this appeal. There, the Court considered
whether an employee can recover for disparate pay received under a “fa-
cially nondiscriminatory and neutrally applied” policy, but which is the
result of intentionally discriminatory pay decisions occurring outside the
statutory filing 

(quoting 

). Here, we are concerned with an employer who made benefits calcu-
lations during the statutory filing period and under a seniority system that
intentionally discriminates against women affected by pregnancy.
                   HULTEEN v. AT&T CORPORATION                     10037
benefits calculation for an employee affected by pregnancy,
even if the pregnancy occurred before the enactment of the

; accord 

;

.

   [2] In Pallas, we did not address whether the PDA had
retroactive effect because Pallas’s complaint alleged that a
post-PDA determination — the calculation of benefits after
the PDA was enacted — discriminated against women on the
basis of their pre-PDA pregnancy leaves.

                                    B

   AT&T admits that under Pallas its current conduct in cal-
culating retirement benefits excluding pre-PDA pregnancy
leave violates Title VII.6 AT&T argued to our three-judge
panel that Landgraf worked a “sea-change” in retroactivity
principles. Thus, AT&T continued, Landgraf is intervening
authority with which the decision in Pallas is “clearly irrecon-
cilable,” a retroactivity argument the panel majority
  6
    We reject as disingenuous AT&T’s argument that Pallas “clearly upset
the settled expectations” that it would not be required to credit pre-PDA
pregnancy leave in the same manner as temporary disability leave when
it made post-PDA retirement and pension decisions. Title VII, enacted in
1964, prohibited employers from discriminating on the basis of sex. 42
U.S.C. § 2000e-2(a)(1). Only one Supreme Court decision cast doubt on
whether Title VII prohibited employers from discriminating on the basis
of pregnancy: General Electric Co. v. Gilbert, 

, 145-46
(1976) (upholding a policy that denied coverage of pregnancy-related dis-
abilities in its disability benefits plan). “When Congress amended Title
VII in 1978, it unambiguously expressed its disapproval of both the hold-
ing and the reasoning of the Court in the Gilbert decision.” Newport News
Shipbldg. & Dry Dock Co. v. EEOC, 

, 678 (1983); see 

(Many members of Congress “expressly agreed with the views of the
dissenting Justices [in Gilbert].”). The PDA therefore did not alter Hult-
een’s or AT&T’s rights or liabilities under Title VII, but corrected Gil-
bert’s erroneous interpretation of Title VII. 

& n.17. Thus,
Pallas, decided in 1991, could not have upset AT&T’s “settled expecta-
tions.”
10038          HULTEEN v. AT&T CORPORATION
embraced. However, as Judge Rymer’s dissenting opinion
ably points out, AT&T’s Landgraf argument fails. We adopt
Judge Rymer’s reasoning:

    [We] read Landgraf as refining, rather than sea-
    changing, the landscape[,] for the Court explicitly
    drew upon Justice Story’s “influential definition” of
    retroactivity in Society for Propagation of the Gos-
    pel v. Wheeler, 

, 766-69 (1814), to
    make clear how courts should determine whether a
    statute operates retroactively:

        A statute does not operate “retrospectively”
        merely because it is applied in a case aris-
        ing from conduct antedating the statute’s
        enactment, or upsets expectations based in
        prior law. Rather, the court must ask
        whether the new provision attaches new
        legal consequences to events completed
        before its enactment. The conclusion that a
        particular rule operates “retroactively”
        comes at the end of a process of judgment
        concerning the nature and extent of the
        change in the law and the degree of connec-
        tion between the operation of the new rule
        and a relevant past event.

        ...

        When a case implicates a federal statute
        enacted after the events in suit, the court’s
        first task is to determine whether Congress
        has expressly prescribed the statute’s reach.
        If Congress has done so, of course, there is
        no need to resort to judicial default rules.
        When, however, the statute contains no
        such express command, the court must
        determine whether the new statute would
               HULTEEN v. AT&T CORPORATION                10039
        have retroactive effect, i.e., whether it
        would impair rights a party possessed when
        he acted, increase a party’s liability for past
        conduct, or impose new duties with respect
        to transactions already completed. If the
        statute would operate retroactively, our tra-
        ditional presumption teaches that it does not
        govern absent clear congressional intent
        favoring such a result.

    

, 269-70, 280[ ] (internal
    citations omitted).

    [We] do not believe that the reasoning or theory of
    Pallas is so irreconcilable with the reasoning or the-
    ory of Landgraf as to give [a three-judge] panel
    license to overrule it. Pallas held that the actionable
    conduct was PT&T’s decision to discriminate
    against the employee on the basis of pregnancy when
    she applied for, and was denied, early retirement.
    The decision to deny benefits was made in the post-
    PDA world. As we emphasized in United States ex
    rel. Anderson v. Northern Telecom, Inc., 

    (9th Cir. 1995), if “the law changes the legal conse-
    quences of conduct that takes place after the law
    goes into effect, the law operates on that conduct
    prospectively.” 

This being the case, and
    assuming (without deciding) that Congress intended
    the PDA to have prospective effect only, Pallas was
    premised on a discrete act — the decision to deny a
    retirement benefit — that gave rise to a current vio-
    lation of the PDA. Given Pallas’s finding of a cur-
    rent violation, the Act operated prospectively on that
    decision.

(Rymer, J., dissenting).

  Nor do we agree with AT&T’s companion argument that
Lockheed Corp. v. Spink, 

(1996), rev’g 

         HULTEEN v. AT&T CORPORATION
616 (9th Cir. 1995), a post-Landgraf decision, demonstrates
that Pallas gave retroactive effect to the PDA. Again, we
adopt Judge Rymer’s analysis:

    Spink involved 1986 amendments to the Age Dis-
    crimination in Employment Act of 1967, 29 U.S.C.
    §[§] 621, 623(i)(1), and the Employee Retirement
    Income Security Act of 1974, 29 U.S.C.
    § 1054(b)(1)(i), that prohibited employers from
    excluding new employees over age 60 from partici-
    pating in their retirement plans. Spink had worked
    for Lockheed between 1939 and 1950, and began
    working there again in 1979 at the age of 61. He was
    excluded by Lockheed’s retirement plan because he
    was over 60. After the 1986 amendments, Spink was
    allowed to participate in the plan, but was not cred-
    ited with accrued benefits based on his years of ser-
    vice with Lockheed prior to the amendments’
    effective date. Spink sued. We held that denying
    credited service years that an older employee would
    otherwise have accumulated was unlawful under the
    amendments. In so doing, we observed that, “[t]o the
    extent our interpretation requires employers to
    include pre-enactment service years in calculating
    accrued benefits, it applies 

, n.1. AT&T seizes upon this remark to maintain
    that when the Supreme Court reversed our conclu-
    sion that Congress intended the statute to have retro-
    active effect, it necessarily agreed that requiring
    employers to include pre-enactment service in calcu-
    lating accrued benefits was a retroactive application.
    [We] cannot read so much into the Spink opinions.
    Our observation in Spink I did not affect our ultimate
    decision in that case because the decision was “based
    on the retroactive intent of the statute manifested in
    its text.” 

Court simply disagreed
    with our construction of the statute. Thus, its analy-
                HULTEEN v. AT&T CORPORATION                10041
    sis — like ours — was limited to Landgraf’s first
    step.

(Rymer, J., dissenting).

   [3] Thus, Landgraf and Spink do not implicate, much less
contradict, the twin holdings of Pallas that the NCS system
is facially discriminatory and that the post-PDA decision as to
Pallas’s eligibility is the relevant, actionable discriminatory
employment practice.

   AT&T also asserts incorrectly that Pallas must be over-
ruled because it relied upon the “continuing violation” doc-
trine abrogated in National Railroad Passenger Corp. v.
Morgan, 

, 114-15 (2002) (holding an employee
can only recover for discrete discriminatory acts that occur
within the statutory filing period). As Judge Rymer explained:

    Neither the reasoning nor theory of Morgan is irrec-
    oncilable with Pallas. Pallas held that the NCS sys-
    tem is facially discriminatory, an issue that was not
    presented in Morgan. Morgan sought damages,
    which Pallas did not. Further, Morgan proceeded on
    the basis of a continuing violation, whereas Pallas
    relied upon PT&T’s decision to deny benefits as the
    discrete act that was actionable. As the Pallas court
    saw it, this was a current violation, not a continuing
    one.

(Rymer, J., dissenting). Morgan is
also inapposite because, as in Pallas, it is undisputed here that
the charges were filed with the EEOC within the statutory fil-
ing period after the denial of retirement benefits.

  Moreover, our decision in Pallas is consistent with Mor-
gan’s holding that “[t]he existence of past acts . . . does not
bar employees from filing charges about related discrete acts
so long as the acts are independently discriminatory and
10042           HULTEEN v. AT&T CORPORATION
charges addressing those acts are themselves timely filed.”

. In Morgan, the Court listed “termi-
nation, failure to promote, denial of transfer, or refusal to
hire” as examples of employment decisions that are discrete
acts, and explained that each one, if decided in a discrimina-
tory fashion, “constitutes a separate actionable ‘unlawful
employment practice.’ ” 

see also 

(explaining “if an employer engages in a series
of acts each of which is intentionally discriminatory, then a
fresh violation takes place when each act is committed”).
While Pacific Bell may have used unlawful calculations in
many prior employment decisions, its denial of early retire-
ment was a discrete independent act. See 

. Because Pallas timely filed a charge, the existence of
past acts would not bar her (or here, Hulteen’s) suit under
Morgan or Ledbetter.

   [4] A three-judge panel must follow a prior circuit decision
unless a subsequent decision by a relevant court of last resort
either effectively overrules the decision in a case “closely on
point” or undercuts the reasoning underlying the circuit prece-
dent rendering the cases “clearly irreconcilable.” 

. Because Pallas is not irreconcilable with
Landgraf, Spink or Morgan, it is well-settled law that the
panel was required to either follow Pallas or make a sua
sponte en banc call. See, e.g., In re Complaint of Ross Island
Sand & Gravel v. Matson, 

, 1018 (9th Cir.
2000) (per curiam) (“[A]bsent a rehearing en banc, we are
without authority to overrule [controlling circuit prece-
dent].”).

   [5] “[T]he important doctrine of stare decisis . . . permits
society to presume that bedrock principles are founded in the
law rather than in the proclivities of individuals, and thereby
contributes to the integrity of our constitutional system of
government, both in appearance and in fact.” Vasquez v. Hil-
lery, 

, 265-66 (1986). “[T]he labor of judges
would be increased almost to the breaking point if every past
                  HULTEEN v. AT&T CORPORATION                     10043
decision could be reopened in every case.” BENJAMIN N.
CARDOZO, THE NATURE OF THE JUDICIAL PROCESS 149 (Yale
Univ. Press 1960). The danger we create when we depart
lightly from our precedent is underscored by AT&T’s admis-
sion here, that even sixteen years after Pallas was decided, it
continues to operate its NCS system in a discriminatory fash-
ion because of “its belief that the PDA does not apply retroac-
tively” and “in order to preserve its ability to litigate the issue
in its own right.” AT&T’s litigation position rests on the
assumption that our precedent can be ignored. Because it can-
not, we affirm the district court’s summary judgment in favor
of Hulteen.7

                                  III

   [6] A plain reading of Title VII supports the legal conclu-
sion reached in Pallas. By passing the PDA, Congress clari-
fied that discrimination “because of sex” under Title VII
included discrimination “because of or on the basis of preg-
nancy, childbirth, or related medical conditions.” 42 U.S.C.
§ 2000e(k). It further added the requirement that employers
treat “women affected by pregnancy . . . the same for all
employment-related purposes, including receipt of benefits
under fringe benefit programs, as other persons not so
affected but similar in their ability or inability to work.” 

also argues that Pallas should not be followed because it failed
to cite and follow the purportedly controlling decision in International
Brotherhood of Teamsters v. United States, 

(1977) (“IBT”).
AT&T argues that IBT forecloses Pallas’s claim because the Court con-
strued 42 U.S.C. § 2000e-2(h) as immunizing neutral seniority systems
from challenge. 

We disagree. In Pallas, we cited Lorance
which not only cited IBT, but also distinguished facially neutral from
facially discriminatory seniority systems. 

, 909,
911-12. Pallas found the NCS system facially discriminatory because it
treated similarly situated employees differently if the female employee
took a pre-PDA pregnancy-related disability leave. 

.
10044           HULTEEN v. AT&T CORPORATION
   In interpreting this additional requirement, we must begin
with the text of the statute. Where congressional intent “has
been expressed in reasonably plain terms, that language must
ordinarily be regarded as conclusive.” Griffin v. Oceanic Con-
tractors, Inc., 

, 570 (1982) (internal quotation
omitted). And when “the meaning of the words seems to us
to be intelligible upon a simple reading, . . . we shall spend
no time upon generalities concerning the principles of [statu-
tory] interpretation.” United States v. M.H. Pulaski Co., 

, 106 (1917).

   [7] The ordinary meaning of “affected” is “[a]cted upon,
influenced, or changed.” The American Heritage Dictionary
of the English Language 28 (4th ed. 2000); see also Black’s
Law Dictionary 62 (8th ed. 2004) (defining “affect” as
“[m]ost generally, to produce an effect on; to influence in
some way”). Applying the ordinary meaning of the term “af-
fected” here leads to the conclusion that although Hulteen was
affected by pregnancy when she took pregnancy leave, she
was again “affected by pregnancy” when AT&T calculated
her retirement benefits in 1994, deliberately choosing to use
an NCS date that would deprive her of benefits received by
those who were not “affected by pregnancy” by excluding her
earlier pregnancy leave from the later calculation of benefits.
It was well within AT&T’s ability and control to calculate
Hulteen’s benefits in 1994 giving her service credit for the
time she spent on pregnancy leave, and to thus avoid violating
the PDA. AT&T simply chose to continue its systematic dis-
crimination against women, based on pregnancy, even after
Congress made it illegal.

   [8] In 1991, Congress amended the Civil Rights Act to
make it clear, if Pallas had not already done so, that an
employer who adopts a seniority system for an intentionally
discriminatory purpose commits an unlawful employment
practice “when the seniority system is adopted, when an indi-
vidual becomes subject to the seniority system, or when a per-
son aggrieved is injured by the application of the seniority
                HULTEEN v. AT&T CORPORATION               10045
system or provision of the system.” Civil Rights Act of 1991,
Pub. L. No. 102-166, 105 Stat. 1071, 1078-79 (Nov. 21,
1991). Congress thus clarified that injury occurs at the time
that the seniority system is applied to the aggrieved party
because that is when the employee is actually harmed by the
deprivation of benefits. See 42 U.S.C. § 2000e-5(e)(2). As the
House Report accompanying the amendment noted, this
amendment was intended to “overrule[ ] Lorance and per-
mit[ ] person[s] to challenge discriminatory employment prac-
tices when those practices actually harm them.” H.R. REP. NO.
102-40, pt. II, at 3 (1991), reprinted in 1991 U.S.C.C.A.N.
694, 695. Congress was concerned that, “[t]aken to its logical
conclusion, the Lorance rule would bar all challenges to pres-
ent day applications of discriminatory practices in existence
when Title VII became law since, under the Lorance rule, the
deadline for a timely charge would have expired before Title
VII became effective.” 

reprinted in 1991
U.S.C.C.A.N. 694, 716. The Supreme Court recently
acknowledged that this amendment was targeted at Lorance
and designed to “allow[ ] Title VII liability [to arise] from an
intentionally discriminatory seniority system both at the time
of its adoption and at the time of its application.” 

n.2.

   [9] AT&T applied its discriminatory seniority system to
Hulteen in 1994, causing her to be deprived of early retire-
ment benefits and thus injuring her. AT&T never asserted that
it could not credit Hulteen with pregnancy leave when it
denied and/or calculated her benefits. Indeed, AT&T and
Hulteen stipulated not only to the number of days each plain-
tiff was penalized within the charging period for past preg-
nancies but also to AT&T’s ability to add service credit to an
employee’s length of service. Instead of engaging in its dis-
criminatory calculation and defending the EEOC charge and
this litigation, AT&T could have simply credited the applica-
ble number of days to each plaintiff’s NCS date when it cal-
culated her benefits.
10046           HULTEEN v. AT&T CORPORATION
   AT&T, in fact, credited plaintiff Elizabeth Snyder thirty
days from her 1974 pregnancy leave in 2000. In a March 1,
2000 letter, Pension Plan Administrator Michael L. Brown
stated:

    In preparing your claim for service credit for the
    period of your maternity leave of absence for review
    by the Employees’ Benefit Committee, it was deter-
    mined that you were not given service credit for the
    first 30 calendar days of your leave (as was the pol-
    icy at the time).

    Therefore, I have authorized the Pension Service
    Center to adjust your Net Credited Service date by
    30 days.

The Pension Service Center, on March 29, 2000, notified Sny-
der that “[a]fter a careful review of [her] service record histo-
ry,” her NCS date had been adjusted from July 29, 1966 to
June 29, 1966. These letters demonstrate that in its determina-
tion of benefits, AT&T does not simply rely on pre-PDA NCS
calculations. Rather, when AT&T determines benefits eligi-
bility, it reviews an employee’s entire work history and affir-
matively chooses to apply “the policy at the time” that the
leave occurred. Any assertion that the violations here are con-
tinuing effects of pre-PDA discrimination and thus “unfortu-
nate event[s] in history which [have] no present legal
consequences” is belied by this record. 

(quoting 

). That AT&T’s prac-
tice of applying the discriminatory pre-PDA policies consti-
tutes a separate and actionable act of discrimination is “too
obvious to warrant extended discussion.” 

(quoting 

).

  AT&T asks us, sitting en banc, to overrule Pallas and fol-
low the Seventh Circuit’s approach in Ameritech Benefit Plan
Committee v. Communication Workers of America, 220 F.3d
                   HULTEEN v. AT&T CORPORATION                       10047
814 (7th Cir. 2000).8 We decline to do so. The Seventh Cir-
cuit’s analysis in Ameritech is problematic because, although
it mentioned the Civil Rights Act of 1991, it failed to actually
apply it.

   In Ameritech, the Seventh Circuit considered a claim nearly
identical to Pallas’s and Hulteen’s made by two women who
filed a charge with the EEOC when, due to an NCS system
that, like Pacific Bell’s and AT&T’s here, failed to credit time
spent on pregnancy leave, they were denied early retirement
benefits in 1994. 

The Seventh Circuit found that
Ameritech’s NCS system was a seniority system because it
calculated “relative lengths of employment.” 

(citing
Cal. Brewers Ass’n v. Bryant, 

, 606 (1980)). It
next incorrectly concluded that the time of injury provisions
of § 2000e-5(e)(2) were inapplicable because the plaintiffs
failed to “show the kind of intentional discrimination that
would trigger [this] exception to the statutory protection
afforded to [bona fide] seniority systems [under 42 U.S.C.
§ 2000e-2(h)].” 

we explained in Pallas, the
NCS system “facially discriminates against pregnant women
[because it] distinguishes between similarly situated employ-

. Facial discrimination is “by its very
terms” intentional discrimination. Lovell v. Chandler, 

, 1057 (9th Cir. 2002); see also UAW v. Johnson
   8
     In Ameritech, decided nine years after Pallas, the Seventh Circuit cre-
ated an inter-circuit conflict over this issue without citing Pallas. Since
then, the Eighth Circuit has rejected an analysis similar to that found in
Ameritech. Cf. Maki v. Allete, Inc., 

, 742-45 (8th Cir. 2004)
(holding that pension benefits calculated post-PDA using past discrimina-
tory marriage and pregnancy policies violated Title VII, rejecting argu-
ments that application of the PDA was impermissibly retroactive and time-
barred because the discriminatory act occurred when the “pension benefits
vested” and the “discriminatory provision . . . was applied to each plain-
tiff”). In Maki, as in Pallas and here, the policy at issue was facially dis-
criminatory. The dissent would have us disregard a well-reasoned decision
by the Eighth Circuit in favor of the Seventh Circuit’s Ameritech decision,
which erroneously failed to apply the very legislation it purported to inter-
pret. See Dissent Op. at 10059 n.7.
10048             HULTEEN v. AT&T CORPORATION
Controls, Inc., 

, 199 (1991) (holding “the
absence of a malevolent motive does not convert a facially
discriminatory policy into a neutral policy with a discrimina-
tory effect”). The Seventh Circuit should have applied
§ 2000e-5(e)(2) to the Ameritech facts, which would have led
it to the ineluctable conclusion that Ameritech had committed
an unfair employment practice in 1994 when it denied early
retirement benefits.

   [10] The Seventh Circuit compounded its error by also con-
cluding that the system was immunized from challenge as an
unlawful employment practice by 42 U.S.C. § 2000e-2(h),
because a seniority system that perpetuates pre-PDA discrimi-
nation can nevertheless be a bona fide system, 

(cit-
ing 

), and thus nonactionable under
§ 2000e-2(h) of Title VII.

  Section 2000e-2(h) provides:

      Notwithstanding any other provision of this subchap-
      ter, it shall not be an unlawful employment practice
      for an employer to apply different standards of com-
      pensation, or different terms, conditions, or privi-
      leges of employment pursuant to a bona fide
      seniority or merit system, . . . provided that such dif-
      ferences are not the result of an intention to discrimi-
      nate because of race, color, religion, sex, or national
      origin . . . . It shall not be an unlawful employment
      practice under this subchapter for any employer to
      differentiate upon the basis of sex in determining the
      amount of the wages or compensation paid or to be
      paid to employees of such employer if such differen-
      tiation is authorized by the provisions of section
      206(d) of Title 29.

42 U.S.C. § 2000e-2(h).9 Under this section, unintentional dis-
  9
   The statutory language, “[i]t shall not be an unlawful employment
practice under this subchapter for any employer to differentiate upon the
                   HULTEEN v. AT&T CORPORATION                     10049
criminatory effects resulting from bona fide seniority systems
are exempted from Title VII’s definition of an unlawful
employment practice. What the Seventh Circuit failed to note
in Ameritech is that the PDA, which was subsequently
enacted to prohibit sex discrimination based on pregnancy,
also expressly provides that “nothing in section 2000e-2(h) of
this title shall be interpreted to permit otherwise.” 42 U.S.C.
§ 2000e(k). Thus, the Ameritech decision runs contrary to this
express legislative directive.

   Neither the Supreme Court nor we have analyzed the inter-
action of these two Title VII provisions.10 By beginning
§ 2000e-2(h) with the phrase “[n]otwithstanding any other
provision of this subchapter,” Congress broadly exempted
bona fide seniority systems from Title VII’s coverage. How-
ever, in enacting the PDA in 1978, Congress could not have
been more clear in expressing its intent to limit the scope of
the bona fide seniority system exemption, when it stated that
“nothing in section 2000e-2(h) of this title shall be interpreted
to permit otherwise.” 42 U.S.C. § 2000e(k). A later-enacted
specific amendment, like the PDA, alters an earlier broad pro-
vision of the statute when the amendment states that it should
control. See FDA v. Brown & Williamson Tobacco Corp., 

, 143 (2000) (“The classic judicial task of reconciling
many laws enacted over time, and getting them to make sense
in combination, necessarily assumes that the implications of
a statute may be altered by the implications of a later statute.

basis of sex in determining the amount of the wages or compensation paid
or to be paid to employees of such employer if such differentiation is
authorized by the provisions of section 206(d) of Title 29,” is also known
as the “Bennett Amendment.”
  10
     Section 2000e(k) post-dates Evans and IBT. Nor was it construed in
any of the Supreme Court decisions concerning timeliness under Title VII.
See 

(sex-based salary discrimination);

(race discrimination); 

-
05 (seniority policy that had a disparate impact on women unrelated to
pregnancy); 

(race-based salary discrimination).
10050           HULTEEN v. AT&T CORPORATION
This is particularly so where the scope of the earlier statute is
broad but the subsequent statute[ ] more specifically address-
[es] the topic at hand.”) (internal citation and quotations omit-
ted); cf. Morton v. Mancari, 

, 545-50 (1974)
(refusing to find an implied repeal of part of Title VII “in the
absence of some affirmative showing of an intention to
repeal”). We agree with the dissent that Congress knows how
to specifically carve out exceptions in Title VII. See Dissent
Op. at 10075-76. If Congress merely wanted to prevent the
Bennett Amendment from being used to justify pregnancy-
based discrimination, it could have tailored § 2000e(k)’s
exception to cover only the Bennett Amendment instead of
broadly excepting all of § 2000e-2(h).

   [11] Further, although Congress did not amend the text of
§ 2000e-2(h) in its 1978 amendments, it unequivocally
expressed a policy that the bona fide seniority system exemp-
tion will not immunize employers from liability for seniority
systems that discriminate based on pregnancy. “ ‘[A] specific
policy embodied in a later federal statute should control our
construction of the [earlier] statute, even though it has not
been expressly amended.’ ” Brown & Williamson Tobacco

(second alteration in original) (quoting
United States v. Estate of Romani, 

, 530-31
(1998)). The express text of, as well as the policy embodied
in, the PDA thus preclude the application of § 2000e-2(h) in
pregnancy discrimination suits under Title VII. Any argument
predicated upon a supposed contrary legislative intent argu-
ment is thus irrelevant to the proper analysis. “[I]t is well-
settled that ‘reference to legislative history is inappropriate
when the text of the statute is unambiguous.’ ” United States
v. Sioux, 

, 1246 (9th Cir. 2004) (quoting HUD
v. Rucker, 

, 132 (2002)).

   [12] Therefore, the Seventh Circuit in Ameritech miscon-
strued the PDA when it held that § 2000e-2(h) shielded
Ameritech from liability for its facially discriminatory prac-
                   HULTEEN v. AT&T CORPORATION                       10051
tices.11 We will not follow a decision that ignores a central
provision of the PDA while purporting to apply it.

                                    IV

   [13] The district court properly applied our decision in Pal-
las to conclude that AT&T’s post-PDA benefits calculations
violated the PDA. Pallas was, and remains, good law. We
therefore affirm the district court’s summary judgment in
favor of Hulteen, Collet, Porter, Snyder and CWA on their
Title VII sex discrimination claims.
  11
     The Sixth Circuit recently adopted part of Ameritech’s analysis in
Leffman v. Sprint Corp., 

(6th Cir. 2007). Leffman was found
ineligible for Special Early Retirement benefits in 2000 because of an
uncredited pregnancy leave taken in 1976. 

The court affirmed
the district court’s grant of summary judgment in favor of Sprint, relying
on Evans, 

and Ameritech, 

The court failed to dis-
cuss the 1991 Civil Rights Amendments, however, and concluded that
Leffman’s claim was time-barred. 

(citing Sawchik v. E.I.
DuPont Denemours & Co., 

, 638 (6th Cir. 1986)). The court
made the same error as the Seventh Circuit in Ameritech, relying on
§ 2000e-2(h) without acknowledging that the PDA had carved out preg-
nancy discrimination from that exemption. 

Finally, the court
inexplicably justified its decision with the flawed conclusion that Sprint
did not discriminate at all because it treated non-credited maternity leave
like other non-credited leave. 

. This comparison was inapt
because, in 1976, Sprint employees received credit for time spent on sick
or disability leave for reasons other than pregnancy. The Leffman court
missed the point that if Leffman had been allowed to take sick or disability
leave for her 1976 pregnancy disability, she would have qualified for early
retirement benefits in 2000 like other employees who received credited
leave time when they were similarly unable to work for reasons other than
pregnancy. See Leffman v. Sprint Corp., No. 3:04CV7222, 

, at *1-2 (N.D. Ohio Jan. 18, 2006). The dissent employs similarly
faulty logic to conclude Hulteen cannot show intentional discrimination
because AT&T’s benefits calculation was made pursuant to her NCS date.
See Dissent Op. at 10069. Like Leffman’s, Hulteen’s benefits would have
been greater if AT&T had chosen when it calculated her retirement bene-
fits post-PDA to treat her pre-PDA pregnancy leave the same as pre-PDA
disability unrelated to pregnancy leave.
10052               HULTEEN v. AT&T CORPORATION
   AFFIRMED.



O’SCANNLAIN, Circuit Judge, with whom Judges RYMER,
BYBEE, and CALLAHAN join, dissenting:

   By concluding that Pallas v. Pacific Bell, 

(9th Cir. 1991), cert. denied, 

(1992), remains
good law, the majority erroneously perpetuates a circuit split
with the Sixth and the Seventh Circuits.1 I believe that Pallas
was wrong then and is wrong now. Because this en banc court
can and should overrule Pallas and follow the Seventh Cir-
cuit’s well-reasoned decision in Ameritech Benefit Plan Com-
mittee v. Communication Workers of America, 

(7th Cir.), cert. denied, 

(2000), I must respect-
fully dissent from the majority’s conclusion that the sex dis-
crimination claims in this case are timely.2
  1
    Compare 

, with Ameritech Benefit Plan
Comm. v. Commc’n Workers of Am., 

(7th Cir. 2000), and
Leffman v. Sprint Corp., 

, 433 (6th Cir. 2007). No circuit has
followed our decision in Pallas.
  2
    The majority devotes considerable attention to whether intervening
Supreme Court authority is “clearly irreconcilable” with our prior decision
in Pallas. Ante, at 10037-43. That standard governs whether a three-judge
panel of our court is free to reexamine the holding of prior circuit prece-
dent. See Miller v. Gammie, 

, 900 (9th Cir. 2003) (en banc).
Here, of course, we sit as an en banc court. If Pallas is wrongly decided,
we are free to overrule it even if subsequent authorities are not “clearly
irreconcilable.” See 

(O’Scannlain, J., concurring in part) (“The
en banc court, however, is unencumbered by any obligation to follow the
decision of a three-judge panel, and therefore is free to do what . . . [a]
panel could not.”); see also Robbins v. Carey, 

, 1149 n.3
(9th Cir. 2007) (“Ordinarily, panels cannot overrule a circuit precedent;
that power is reserved to the circuit court sitting en banc.”). I turn directly
to that inquiry.
                   HULTEEN v. AT&T CORPORATION                      10053
                                     I

   At the core of this dispute is AT&T Corporation’s (“AT&T”)3
Net Credit Service (“NCS”) seniority system, a concept which
is not defined in Title VII. See Cal. Brewers Ass’n v. Bryant,

, 605 (1980). The term “seniority” connotes
length of employment. 

system’ is a scheme
that, alone or in tandem with non-‘seniority’ criteria, allots to
employees ever improving employment rights and benefits as
their relative lengths of pertinent employment increase.” 

(footnotes omitted). “[T]he principal feature of any
and every ‘seniority system’ is that preferential treatment is
dispensed on the basis of some measure of time served in
employment.” 

“In order for any seniority system
to operate at all, it has to contain ancillary rules that accom-
plish certain necessary functions.” 

“[E]very senior-
ity system must include ancillary rules that delineate how and
when the seniority time clock begins ticking,” as well as other
provisions that “define which passage of time will ‘count’
towards the accrual of seniority and which will not.” 

such a seniority system. Pursuant to that system,
AT&T maintains an NCS date for each employee (from the
initial date of hire until the date of termination) that consists
of that employee’s original hire date and any adjustments for
periods during which no service credit is accrued pursuant to
ancillary rules. AT&T moves the NCS date forward to
“squeeze out” the periods of leave or breaks in service that are
not credited, resulting in a later NCS date. AT&T uses the
NCS date that it maintains for each employee for purposes of
determining retirement benefits and other employment bene-
fits. An earlier NCS date places an employee in a compara-
  3
   For sake of convenience, I refer throughout this dissent to the employer
as AT&T, even though AT&T was a successor in interest to Pacific Tele-
phone and Telegraph (“PT&T”) after the former Bell system was broken
up in 1984. The difference in corporate identity does not affect the out-
come of this case.
10054             HULTEEN v. AT&T CORPORATION
tively better position for employment-related determinations,
including job bidding, layoffs, and eligibility for and calcula-
tion of certain retirement benefits.

   Prior to August 7, 1977, AT&T’s seniority system included
two ancillary rules important to this case. The first provided
that an employee received only 30 days of NCS credit for per-
sonal leave, but received full credit for temporary disability
leave. The second specified that pregnancy leave would be
treated as personal leave. AT&T applied these two rules to
calculate NCS dates for all employees who became pregnant
prior to that date. At no time did AT&T apply the pregnancy
leave rule to any employee who became pregnant on or after
August 7, 1977. With one exception,4 the record fails to estab-
lish that on or after August 7, 1977, AT&T applied the preg-
nancy leave rule in effect before that date to adjust or to
recalculate any employee’s NCS date.

   On August 7, 1977, AT&T adopted the Maternity Payment
Plan (“MPP”), which supplanted the prior pregnancy leave
rule. According to the MPP’s new rule, up to six months of
pregnancy leave would be treated as disability leave with full
NCS credit, and any pregnancy leave in excess of six months
would be treated as personal leave with a maximum of 30
days of NCS credit. Employees on non-pregnancy related dis-
ability leave continued to receive full NCS credit. AT&T
applied the MPP pregnancy leave rule to adjust the NCS dates
for all employees who became pregnant before April 29,
1979; AT&T did not retroactively apply the MPP pregnancy
leave rule to adjust the NCS dates for any employees who
became pregnant before August 7, 1977. The record fails to
demonstrate that AT&T applied the MPP pregnancy leave
rule to adjust or to recalculate any employee’s NCS date on
or after April 29, 1979.
  4
    In 2000, AT&T credited Elizabeth Snyder’s NCS seniority with 30
days because the previous NCS date mistakenly had not been adjusted ear-
lier for her pregnancy leave in 1974. See infra pp. 10067-68.
                   HULTEEN v. AT&T CORPORATION                       10055
   In response to the Pregnancy Discrimination Act of 1978
(“PDA”), Pub. L. No. 95-555, 92 Stat. 2076, on April 29,
1979 (the effective date of the PDA), AT&T adopted the
Anticipated Disability Plan (“ADP”), which superseded the
MPP pregnancy leave rule. The ADP provided that pregnancy
leave would be treated as disability leave with full NCS credit
for the entire period of pregnancy. The ADP pregnancy leave
rule remains in effect in AT&T’s current NCS seniority sys-
tem. AT&T applies the new ADP pregnancy leave rule to
adjust the NCS dates for all employees who become pregnant
on or after April 29, 1979. AT&T, however, made no adjust-
ment to the NCS dates for employees who had been subject
to the MPP pregnancy leave rule or the pre-1977 pregnancy
leave rule. Thus, for example, an employee who took preg-
nancy leave in 1980, after the effective date of the PDA,
would receive full NCS seniority credit for that period of
leave, but no adjustments were made to the NCS date of an
employee who took pregnancy leave in 1976 and received a
maximum of 30 days NCS seniority credit, or who took preg-
nancy leave in 1977 and received a maximum of six months
and 30 days of credit.

   Noreen Hulteen, Eleanora Collect, Linda Porter, and Eliza-
beth Snyder are all female employees of AT&T who took
pregnancy leaves between 1968 and 1976, before the enact-
ment of the PDA.5 Under AT&T’s NCS seniority system in
effect at that time, Hulteen, Collect, Porter, and Snyder
received only partial NCS credit for their pregnancy leaves,
resulting in a later NCS date. AT&T’s subsequent calculation
of their benefits or the dates of their retirement eligibility
between 1994 and 2000, would have been more favorable had
AT&T retroactively credited their NCS dates for the previ-
ously uncredited periods of pregnancy leave before the enact-
  5
   For the sake of convenience, I will focus specifically on Hulteen’s sex
discrimination claim throughout the dissent. Except where expressly
noted, the reasoning with respect to that claim applies equally to the other
employees’ claims.
10056           HULTEEN v. AT&T CORPORATION
ment of the PDA. They contend that AT&T discriminated on
the basis of sex in violation of Title VII when AT&T deter-
mined their benefits based on the NCS dates that were unad-
justed to account for uncredited pre-PDA pregnancy leave.

                               II

                               A

   Title VII of the Civil Rights Act of 1964, Pub. L. No. 88-
352, 78 Stat. 241, makes it an “unlawful employment prac-
tice” for any employer “to discriminate against any individual
with respect to his compensation, terms, conditions, or privi-
leges or employment, because of such individual’s . . . sex.”
42 U.S.C. § 2000e-2(a)(1).

   In General Electric Co. v. Gilbert, 

(1976), the
Supreme Court held that discrimination based on pregnancy
was not discrimination within the meaning of Title VII. 

There, General Electric adopted an employee disabil-
ity benefit plan that paid weekly nonoccupational sickness
and accident benefits. 

However, General Electric
excluded from that plan’s coverage disabilities arising from
pregnancy. 

issue before the Court was
whether Title VII prohibited excluding pregnancy-related dis-
abilities from an employer’s disability benefit plan. The
Supreme Court recognized that pregnancy is confined to
women, but reasoned that the disability benefit plan did not
discriminate in violation of Title VII by excluding pregnancy-
related disabilities from its coverage:

    The Plan, in effect (and for all that appears), is noth-
    ing more than an insurance package, which covers
    some risks but excludes others. The “package” going
    to relevant identifiable groups we are presently con-
    cerned with—General Electric’s male and female
    employees—covers exactly the same categories of
    risk, and is facially nondiscriminatory in the sense
                  HULTEEN v. AT&T CORPORATION                     10057
      that “there is no risk from which men are protected
      and women are not. Likewise, there is no risk from
      which women are protected and men are not.” As
      there is no proof that the package is in fact worth
      more to men than to women, it is impossible to find
      any gender-based discriminatory effect in this
      scheme simply because women disabled as a result
      of pregnancy do not receive benefits; that is to say,
      gender-based discrimination does not result simply
      because an employer’s disability-benefits plan is less
      than all-inclusive.

(internal citations and footnote omitted).

  In 1978, in response to Gilbert, Congress passed the Preg-
nancy Discrimination Act of 1978, Pub. L. No. 95-555, 92
Stat. 2076, which became effective on April 29, 1979,6 and
amended Title VII to define “because of sex” or “on the basis
of sex” to include discrimination based on pregnancy. 42
U.S.C. § 2000e(k). The PDA states in relevant part:

      The terms “because of sex” or “on the basis of sex”
      include, but are not limited to, because of or on the
      basis of pregnancy, childbirth, or related medical
      conditions; and women affected by pregnancy, child-
      birth, or related medical conditions shall be treated
      the same for all employment-related purposes,
      including receipt of benefits under fringe benefit
      programs, as other persons not so affected but simi-
      lar in their ability or inability to work, and nothing
      in section 2000e-2(h) of this title shall be interpreted
      to permit otherwise. . . .
  6
   “The amendment to Title VII became effective on the date of its enact-
ment, October 31, 1978, but its requirements did not apply to any then-
existing fringe benefit program until 180 days after enactment—April 29,
1979.” Newport News Shipbuilding & Dry Dock Co. v. EEOC, 

, 671 n.2 (1983).
10058           HULTEEN v. AT&T CORPORATION

must file charges of discrimination under
Title VII within 180 days “after the alleged unlawful employ-
ment practice occurred,” unless the employee has first insti-
tuted proceedings with a state or local agency, in which case
the period is extended to 300 days. 42 U.S.C. § 2000e-5(e)(1).
The dispositive issue in this case is whether Hulteen timely
filed a sex discrimination action within the specified period of
limitations.

   As the Supreme Court has repeatedly stressed, we must
“identify with care the specific employment practice that is at
issue” when determining whether the sex-discrimination
action is timely. Ledbetter v. Goodyear Tire & Rubber Co.,

, 2167 (2007) (citing Nat’l Railroad Passen-
ger Corp. v. Morgan, 

, 110-11 (2002)); see also
Delaware State College v. Ricks, 

, 257 (1980).
There are three possible candidates in this case: (1) AT&T’s
adoption of its pregnancy leave rules before the enactment of
the PDA; (2) AT&T’s application of those leave rules to
adjust Hulteen’s NCS date before the enactment of the PDA;
and (3) AT&T’s calculation of Hulteen’s retirement benefits
in 1994 based, in part, on the NCS date it consistently main-
tained for her without retroactively adjusting that date for pre-
PDA pregnancy leave. The time to challenge the first and sec-
ond possible employment practices, however, has long since
expired. Accordingly, relying on our prior decision in Pallas,
Hulteen points us to the third alternative employment practice
in 1994 when AT&T declined to grant retroactive NCS credit
for pre-PDA pregnancy leave before it calculated her retire-
ment benefits.

   Accepting Hulteen’s argument that such calculation in
1994 constituted a new and current violation of Title VII, the
majority holds that her Title VII action is timely. In so con-
cluding, the majority perpetuates Pallas’s error by breathing
new life into an expired sex discrimination claim. On virtually
                   HULTEEN v. AT&T CORPORATION                       10059
identical facts, the Seventh Circuit reached the opposite con-
clusion in Ameritech.7 Because I believe the Seventh Circuit’s
decision faithfully applies controlling Supreme Court prece-
dents and the relevant provisions of Title VII, I would follow
that court’s reasoning.

                                    III

   “The outcome of this case,” as the Seventh Circuit recog-
nized, “turns on which of two competing lines of authority
provide a better ‘fit’ here.” 

. The
Seventh Circuit followed United Air Lines v. Evans, 

(1977), and its progeny. In Pallas, on the other hand, this
court followed Bazemore v. Friday, 

(1986) (per
curiam). Because the majority follows Pallas today, the
Bazemore and Evans line of cases deserve careful attention.

                                    A

   In Bazemore, the North Carolina Agricultural Extension
Service (“Service”) maintained two separate, racially segre-
gated work forces and paid black employees less than white
employees prior to the enactment of Title 

(Brennan, J., joined by all other Members of the
Court, concurring in part). After the enactment of Title VII,
the Service integrated the workforce, but the pay disparity
between black employees and white employees in the same
positions remained. 

Court held that the Ser-
vice was not liable for the discriminatory acts that occurred
prior to the enactment of Title VII and therefore “recovery
may not be permitted for [pre-Title VII] acts of discrimina-
  7
    The majority contends that in Maki v. Allette, Inc., 

(8th
Cir. 2004), the Eighth Circuit rejected an analysis similar to that found in
Ameritech. Ante, at 10047 n.8. But that case is quite different from Ameri-
tech and the one before us today. Unlike in Maki, Hulteen has not estab-
lished that, after the enactment of the PDA, AT&T adopted a new
seniority rule to bridge prior periods of employment for an intentionally
discriminatory purpose.
10060           HULTEEN v. AT&T CORPORATION
tion.” 

However, the Supreme Court concluded that
the pay disparity that remained after the enactment of Title
VII was unlawful because “[e]ach week’s paycheck that
delivers less to a black than to a similarly situated white is a
wrong actionable under Title VII, regardless of the fact that
this pattern was begun prior to the effective date of Title VII.”

                               B

                               1

   The Supreme Court’s decision in Evans represents the
fountainhead for the competing line of authority. In Evans,
United Air Lines (“United”) maintained a policy of refusing
to allow its female flight attendants to be mar

. Evans married in 1968 and therefore was forced to
resign pursuant to United’s no-marriage policy. 

the Seventh Circuit held that United’s policy violated
Title VII. Sprogis v. United Air Lines, 

(7th
Cir.), cert. denied, 

(1971). Evans, however, was
not a party to Sprogis and failed to initiate any proceedings
against United within the period of limitation for that past act
of discrimination. 

. After United ended
the no-marriage policy, United rehired Evans in 1972 as a
new employee, but refused to give her seniority credit for any
prior service with United. 

that it was too
late to bring an action for her forced termination, but asserted
that “United [was] guilty of a present, continuing violation of
Title VII and therefore that her claim is timely.” 

   Evans argued that “the seniority system gives present effect
to the past illegal act and therefore perpetuates the conse-
quences of forbidden discrimination.” 

Rejecting
that argument, the Court emphasized that “United’s seniority
system does indeed have a continuing impact on her pay and
fringe benefits. But the emphasis should not be placed on
mere continuity; the critical question is whether any present
                    HULTEEN v. AT&T CORPORATION                       10061
violation exists.” 

(first emphasis added). Conclud-
ing that none did, the Court explained that “[a] discriminatory
act which is not made the basis for a timely charge is the legal
equivalent of a discriminatory act which occurred before the
statute was passed. . . . . [I]t is merely an unfortunate event
in history which has no present legal consequences.” 

                                      2

   The Supreme Court again embraced Evans’s reasoning in
Delaware State College v. Ricks, 

. In that case,
Delaware State College denied Ricks, an African American
librarian, academic tenure in March 1974. 

Adher-
ing to its policy of not discharging immediately a junior fac-
ulty member who did not receive tenure, the College offered
Ricks a nonrenewable one-year “terminal” contract that
would expire on June 30, 1975, with explicit notice that his
employment would end on that date. 

Ricks filed an
employment discrimination charge against the College in
April 1975, alleging, inter alia, that the College unlawfully
discriminated against him on the basis of race in violation of
Title VII. 

   Ricks argued that the period of limitations ran from the date
that his one-year terminal contract expired rather than the date
when the College denied tenure. Id at 257. Rejecting Ricks’s
argument, the Supreme Court held that his claim for discrimi-
nation in violation of Title VII was untimely. 

The
Court concluded that “the only alleged discrimination
occurred—and the filing limitations period therefore
commenced—at the time the tenure decision was made and
communicated to Ricks . . . . even though one of the effects
of the denial of tenure—the eventual loss of a teaching
position—did not occur until later.”8 

The Supreme
  8
    I note that, according to the parties’ joint stipulation of facts, Hulteen
(as well as the other plaintiffs) knew that AT&T granted only partial NCS
10062             HULTEEN v. AT&T CORPORATION
Court emphasized that “[i]t is simply insufficient for Ricks to
allege that his termination ‘gives present effect to the past act
and therefore perpetuates the consequences of forbidden dis-
crimination.’ ” 

431 U.S. at 557).

                                  3

   The Supreme Court’s recent decision in Ledbetter v. Good-
year Tire & Rubber Co., 

, confirms this under-
standing of the Evans line of authority. Ledbetter worked for
Goodyear Tire and Rubber Company (“Goodyear”) from
1979 until 1998. 

Goodyear maintained a policy
during that time of granting or denying raises for salaried
employees based on their supervisors’ evaluations of their
performance. 

Ledbetter brought an action against
Goodyear, asserting, among other claims, a Title VII pay dis-
crimination claim. 

she “introduced evidence that
during the course of her employment several supervisors had
given her poor evaluations because of her sex, that as a result
of these evaluations her pay was not increased as much as it
would have been if she had been evaluated fairly, and that
these past pay decisions continued to affect the amount of her
pay throughout her employment.” 

The evi-
dence also established that Ledbetter was earning signifi-
cantly less than her male counterparts at the end of her career.

   Ledbetter argued that her action was timely, pointing to two
different employment practices during the applicable period
of limitation as possible candidates. 

First, she
argued that each paycheck issued during the period of limita-
tions was a separate act of discrimination. 

at the time of her pre-PDA pregnancy leave, was aware that her
unadjusted NCS seniority dated traveled with her from PT&T to AT&T
in 1984, and periodically received documents throughout her employment
containing the unadjusted NCS seniority date. See also 

& n.10.
                HULTEEN v. AT&T CORPORATION                10063
she argued that the 1998 decision denying her a raise “was
‘unlawful because it carried forward intentionally discrimina-
tory disparities from prior years.’ ” 

she sug-
gests that it is sufficient that discriminatory acts that occurred
prior to the charging period had continuing effects during that
period.” 

Court rejected Ledbetter’s first
argument because she failed to allege actual discriminatory
intent by the relevant Goodyear decisionmakers when they
issued her checks or denied her a raise in 1998. 

the Court rejected Ledbetter’s alternative argument,
concluding that it was squarely foreclosed by the Evans line
of authority. 

emphasized that the instruction
from that line of authority is clear: “The EEOC charging
period is triggered when a discrete unlawful practice takes
place. A new violation does not occur, and a new charging
period does not commence, upon the occurrence of subse-
quent non-discriminatory acts that entail adverse effects
resulting from the past discrimination.” 

The Court
specifically rejected as unsound Ledbetter’s attempt to shift
the intent from the prior discriminatory employment practice
to the 1998 pay decision denying her raise. 

Accordingly, the Supreme Court held that Ledbetter’s claim
was untimely. 

                                C

   Bazemore stands for the general proposition that an
employment practice coupled with discriminatory intent
within the charging period gives rise to a current violation of
Title VII, even if related to past, uncharged discriminatory
acts. See 

. The Evans-Ricks-
Ledbetter line of authority stands for the proposition that an
act within the charging period that gives present effect to past
discriminatory acts, without more, does not give rise to a cur-
rent violation. Hulteen’s case turns on whether AT&T calcu-
lated her benefits in 1994 with the requisite discriminatory
intent (Bazemore) or whether that calculation simply gave
10064           HULTEEN v. AT&T CORPORATION
effect through the NCS date of past, uncharged discriminatory
acts (Evans-Ricks-Ledbetter).

   In Ameritech, the Seventh Circuit found the Evans line of
authority controlling because of the “fact, simplistic as it may
seem, that [the] case involves computation of time in service
—seniority by another name—followed by a neutral applica-
tion of a benefit package to all employees with the same
amount of time.” 

. Pallas and the
majority today, on the other hand, reached the contrary con-
clusion, finding that Bazemore was the “controlling Supreme
Court precedent” for two reasons: “First, the discriminatory
program which gave rise to this suit, the Early Retirement
Opportunity, was instituted in 1987 . . . . Pallas challenges the
criteria adopted in 1987 to determine eligibility for the new
benefit program . . . . Second, the net credit system used to
calculate eligibility under the Early Retirement Opportunity is
not facially neutral. The system used to determine eligibility
facially discriminates against pregnant 

. With respect, Pallas was clearly wrong. The Supreme
Court’s logic in Evans, Ricks, and Ledbetter dictates the out-
come of the case before us today.

                               1

   The Supreme Court’s most recent decision in Ledbetter
confirms that under Evans “current effects alone cannot
breathe life into prior, uncharged discrimination.” 

. The charging period (here, the 180 days
during which Hulteen was required to file a charge with the
EEOC), “is triggered when a discrete unlawful practice takes
place.” 

discrete unlawful practice requires the
coalescence of two elements: (1) an employment practice
(defined as “ ‘a discrete act or single “occurrence’ ” that takes
place at a particular point in time”); and (2) discriminatory
intent. 

2171. Here, the majority concludes that the
AT&T’s denial of benefits under the retirement plan in 1994
is an “employment practice.” Ante, at 10041-42. But that
                HULTEEN v. AT&T CORPORATION                10065
alone is insufficient. Ledbetter requires concurrent discrimi-
natory intent.

                                a

   Pallas concluded that the “NCS [seniority] system used to
calculate eligibility under the [retirement plans] is not facially
neutral. The system used to determine eligibility facially dis-
criminates against pregnant 

.
Today, the majority locates discriminatory intent at the point
AT&T calculated Hulteen’s benefits in 1994 by embracing
Pallas’s erroneous determination that the NCS seniority sys-
tem is facially discriminatory and concluding that “[f]acial
discrimination is ‘by its very terms’ intentional discrimina-
tion.” Ante, at 10047 (citation omitted). The majority’s posi-
tion is erroneous.

   AT&T’s current NCS seniority system includes a facially
nondiscriminatory and neutrally applied pregnancy leave rule
that grants female employees who become pregnant after the
enactment of the PDA full NCS seniority credit on the same
terms as employees who become temporarily disabled. The
retirement benefit plan under which Hulteen received retire-
ment benefits is also facially nondiscriminatory and neutrally
applied: calculation of eligibility and benefits under that plan
are determined based on an NCS date maintained for each
employee. That NCS date is also facially nondiscriminatory.
But the majority asserts facial discrimination by looking long
ago to the pre-PDA pregnancy leave rules that AT&T law-
fully applied before the enactment of the PDA to adjust the
NCS dates to grant only partial seniority credit for pre-PDA
pregnancy leave. The majority’s conclusion reaches too far.

   The problem with the majority’s conclusion that the NCS
seniority system is facially discriminatory because the NCS
date reflects AT&T’s pre-PDA pregnancy leave rules is that
it necessarily depends on a retroactive application of the PDA.
Before the enactment of the PDA, the Supreme Court had
10066            HULTEEN v. AT&T CORPORATION
concluded in Gilbert, 

, that classifications based
on pregnancy involved no facial gender-based discrimination.

138; see also Nashville Gas Co. v. Satty, 

, 140 (1977) (“Petitioner’s decision not to treat preg-
nancy as a disease or disability for purpose of seniority reten-
tion is not on its face a discriminatory policy.”). Pallas
concluded that the NCS seniority system was facially discrim-
inatory because it “distinguishes between similarly situated
employees: female employees who took leave prior to 1979
due to a pregnancy-related disability and employees who took
leave prior to 1979 for other temporary 

. This conclusion therefore rests on a silent premise
that gives impermissible retroactive effect to the PDA.

   A system is facially discriminatory, of course, if it treats
similarly situated employees differently. Hulteen asserts that,
as a female employee who took pregnancy leave prior to the
enactment of the PDA, she was treated differently from
employees who took leave for other temporary disabilities
during that same period. But these two groups are not simi-
larly situated. Temporarily disabled employees were not
female employees who took pregnancy leaves, but were
female and male employees who took other types of disability
leaves and, under the lawful seniority rules then in effect,
were entitled to accrue seniority credit for the full duration of
their leaves. And female employees who took pre-PDA preg-
nancy leaves under AT&T’s then lawful pre-PDA pregnancy
leave rules accrued seniority credit only for a portion of their
leaves. While this may be regrettable in hindsight, because it
was then lawful to distinguish between the two reasons for
leaves prior to the PDA, the two groups were not similarly sit-
uated. AT&T’s failure to award full seniority credit for pre-
PDA pregnancy leaves could be labeled facially discrimina-
tory only if employees in both groups were similarly situated.
That would be true, however, only if the PDA were given
impermissible retroactive effect. Because the PDA is not retro-
active,9 Pallas is wrong and the majority today is mistaken in
  9
  Landgraf v. USI Films Prods., 

, 258 n.10 (1994) (“[I]n
amending Title VII to bar discrimination on the basis of pregnancy in
                   HULTEEN v. AT&T CORPORATION                     10067
concluding that AT&T’s pre-PDA pregnancy leave rules were
facially discriminatory in violation of Title VII. Accordingly,
because the majority errs in concluding that the NCS seniority
system is facially discriminatory in violation of Title VII, it
necessarily errs in finding current discriminatory intent based
on the 1994 calculation.

                                    b

   Straining to find discriminatory intent when AT&T calcu-
lated Hulteen’s retirement benefits in 1994 based on the NCS
date, the majority also asserts that Hulteen satisfies that bur-
den by pointing to a single act by AT&T in crediting another
employee’s NCS date based on the pre-PDA pregnancy leave
rules. Ante, at 10046. In 2000, AT&T credited Snyder’s NCS
seniority date for 30 days because previously her NCS date
mistakenly had not been credited at all for her pregnancy
leave in 1974. The majority extrapolates from this retroactive
credit that “in the determination of benefits, AT&T does not
simply rely on pre-PDA NCS calculations,” but “reviews an
employee’s entire work history and affirmatively chooses to
apply ‘the policy at the time’ that the leave occurred.” Ante,

1978, Congress provided: ‘Except as provided in subsection (b), the
amendment made by this Act shall be effective on the date of enactment.’
The only Courts of Appeals to consider whether the 1978 amendments
applied to pending cases concluded that they did not. If we assume that
Congress was familiar with those decisions, its choice of language in
§ 402(a) would imply nonretroactivity.” (citations omitted)); 

(recognizing that the PDA has not been treated as retroac-
tive); Whitehead v. Oklahoma Gas & Elec. Co., 

, 1193 (10th
Cir. 1999) (concluding that the PDA is not retroactive); Wambheim v. J.C.
Penny Co., 

, 363 n.1 (9th Cir. 1981) (concluding that the
PDA did not apply in a case where the facts occurred before 1978); Fields
v. Bolger, 

, 1219 n.4 (6th Cir. 1984) (noting that the PDA
“was intended to be prospective only in application”); Schwabenbauer v.
Board of Ed. of School Dist. of Olean, 

, 310 n.7 (2d Cir.
1981) (concluding the PDA is not retroactive); Condit v. United Air Lines,
Inc., 

, 1139-40 (4th Cir. 1980) (same).
10068           HULTEEN v. AT&T CORPORATION
at 10046. Any contrary assertion, the majority contends, “is
belied by this record.” Ante, at 10046. But it is the majority’s
perception of discriminatory intent based on this isolated
response to an error that is belied by the applicable standard
of review.

   While previously recognizing that “ ‘[w]e must determine,
viewing the evidence in the light most favorable to [AT&T],
the non-moving party, whether [there are any genuine issues
of material fact and whether] the district court correctly
applied the substantive law,’ ” ante, at 10033 (second alter-
ation in original) (quoting Olsen v. Idaho State Bd. of Med.,

, 922 (9th Cir. 2004)), the majority fails to apply
that standard here. Viewing the evidence in the light most
favorable to AT&T, as we must, the letters evidencing
AT&T’s crediting of Snyder’s NCS date fail to demonstrate
that, “when AT&T determines benefits eligibility, it reviews
an employee’s entire work history and affirmatively chooses
to apply ‘the policy at the time’ that the leave occurred.” Ante,
at 10046. Rather, in the light most favorable to AT&T, that
evidence suggests that AT&T relies on the pre-PDA NCS cal-
culations, but in this one case an error came to light that
required it to review Snyder’s entire work history and to
adjust her NCS date for a previously uncredited pre-PDA
pregnancy leave. That evidence further suggests that AT&T
reviewed Snyder’s service record and adjusted her NCS date
in response to her request, not as a matter of course for all
employees: “In preparing your claim for service credit for the
period of your maternity leave of absence for review by the
Employees’ Benefit Committee, it was determined that you
were not given service credit for the first 30 calendar days of
your leave (as was the policy at the time).” Moreover, the par-
ties stipulated that “whether or not Snyder’s NCS date was
adjusted in the year 2000 does not affect the outcome of this
[stage of the] proceeding.”

   The only thing that is “ ‘too obvious to warrant extended
discussion,’ ” ante, at 10046 (quoting Ledbetter, 127 S. Ct. at
                   HULTEEN v. AT&T CORPORATION                       10069
2173), is the majority’s far-reaching efforts to infer the requi-
site discriminatory intent at the time AT&T calculated and/or
denied retirement benefits. Simply put, the record fails to
demonstrate that AT&T acted with discriminatory intent dur-
ing the charging period.

                                     2

   There is no meaningful basis for distinguishing Evans and
this case, which becomes abundantly evident when the key
aspects of each case are compared. In both Evans and here,
the employers maintained a host of employment programs10
that determined eligibility based on a seniority system. Those
benefit programs were facially nondiscriminatory and neu-
trally applied, but gave effect through the seniority system to
past discriminatory acts. Evans’s seniority was less because in
early 1968 United maintained a policy that forced her to
resign because she was female and because she married. Hult-
een’s seniority was less because AT&T maintained a pre-
PDA pregnancy leave rule that forced her to take personal
leave with only partial NCS seniority credit because she was
female and because she became pregnant. Because of the past
acts of discrimination, Evans and Hulteen had less seniority,11
and, not surprisingly, the determinations of their benefits
under those programs were adversely affected

  Faced with “the question . . . whether the employer is com-
mitting a second violation of Title VII by refusing to credit
her with seniority for any [prior] period,” the Supreme Court
concluded in Evans that “such a challenge to a neutral system
  10
      In Evans, the seniority system “determine[d] a flight attendant’s
wages; the duration and timing of vacations; rights to retention in the
event of layoffs and rights to re-employment thereafter; and rights to pref-
erential selection of flight 

n.5. In Pallas, as
in this case, the NCS system was used for a host of employment-related
purposes, including job bidding, shift preferences, layoffs, and eligibility
for and calculation of certain benefit programs.
   11
      Seniority, by its very nature, reflects past employment decisions.
10070           HULTEEN v. AT&T CORPORATION
may not be predicated on the mere fact that a past event which
has no present legal significance has affected the calculation
of seniority credit, even if the past event might at one time
have justified a valid claim against the 

, 560. Thinking itself the wiser, the majority adopts Pal-
las’s “contrary view,” which, with respect, should be rejected
because it “substitute[s] a claim for seniority credit for almost
every claim which is barred by limitations.” 

                               3

   The majority repeats Pallas’s error by invoking Bazemore
in this case. See ante, at 10035-37. Bazemore is simply inap-
posite. First, as the Supreme Court recently emphasized in
Ledbetter, “Bazemore stands for the proposition that an
employer violates Title VII and triggers a new EEOC charg-
ing period whenever the employer issues a paycheck using a
discriminatory pay structure. But a new Title VII violation
does not occur and a new charging period is not triggered
when an employer issues paychecks pursuant to a system that
is ‘facially nondiscriminatory and neutrally applied.’ ” Led-

(quoting Lorance v. AT&T Technol-
ogies, Inc., 

, 911 (1989)). As discussed above,
Hulteen’s retirement benefits were calculated pursuant to a
facially nondiscriminatory and neutrally applied benefits plan,
which relies upon the NCS date. That date, which is the prod-
uct of the NCS seniority system, gives effect to the then-
lawful pre-PDA pregnancy leave rules that granted only par-
tial NCS credit for pre-PDA pregnancy leave. However, with-
out having established discriminatory intent in 1994 when
AT&T calculated benefits, Bazemore is of no help to Hulteen.
As the Supreme Court emphasized in Ledbetter, “[t]he fact
that precharging period discrimination adversely affects the
calculation of a neutral factor (like seniority) that is used in
determining future pay does not mean that each new paycheck
constitutes a new violation and restarts the EEOC charging

(emphasis added).
                  HULTEEN v. AT&T CORPORATION                   10071
   Second, in Bazemore the post-Title VII salary structure
resulted in a fresh violation of Title VII because it was a
“ ‘mere continuation’ ” of the pre-Title VII discriminatory
pay structure. 

(quoting Bazem-

n.6 (Brennan, J., joined by all other
Members of the Court, concurring in part)). But in this case,
AT&T’s NCS seniority system is not the “mere continuation”
of the pre-PDA pregnancy leave rules; indeed it was expressly
amended to give full effect to pregnancy leave post-PDA. In
Bazemore, a current violation existed because the Service
paid black employees less than white employees for each new
hour (week, month, or year) of work after the enactment of
Title VII. In this case, no current violation exists: AT&T
grants NCS seniority credit for each period of pregnancy
leave after the enactment of the PDA, on the same terms as
disability-related leave. Simply put, unlike in Bazemore,
AT&T’s pre-PDA pregnancy leave rules no longer apply to
female employees who took pregnancy leave after the enact-
ment of the PDA, which made such distinction based on preg-
nancy a violation of Title VII. Bazemore would only be
analogous in this case if AT&T had continued to deny full
NCS seniority credit to female employees who had taken
pregnancy leave after the enactment of the PDA and
attempted to defend that practice on the ground that it began
before the enactment of that Act.12 But AT&T did no such
thing.

   Finally, the majority’s strained interpretation of Bazemore
effectively imposes an unjustified burden on AT&T to rem-
edy all acts of discrimination on the basis of pregnancy before
  12
     For example, if a female employee took pregnancy leave in 1976,
before the enactment of the PDA, and again in 1981, after the enactment
of the PDA, the reasoning in Bazemore would apply only if AT&T contin-
ued to limit NCS seniority credit to 30 days (the maximum credit under
AT&T’s pregnancy leave rule in effect in 1976) for her pregnancy leave
in 1981. However, AT&T grants full NCS seniority credit for pregnancy
leaves taken after the enactment of the PDA. Accordingly, Bazemore is
simply inapt here.
10072             HULTEEN v. AT&T CORPORATION
the enactment of the PDA. Because the PDA is not retroactive,13
that is more than Congress required with the PDA. That is
also more than the Supreme Court required in Bazemore.
There, the Court held that “recovery may not be permitted for
pre-[Title VII] acts of discrimination”; thus the Service was
not required to pay retroactively the salary disparity for pre-
Title VII discrimination. 

(Bren-
nan, J., joined by all other Members of the Court, concurring
in part) (emphasis added). Indeed, the Supreme Court empha-
sized that its decision in Bazemore “in no sense gives legal
effect to the pre-1972 actions, but, consistent with Evans . . . ,
focuses on the present salary structure, which is illegal if it is
a mere continuation of the [pre-Title VII] discriminatory pay
structure.” 

n.6. By requiring AT&T now to grant
retroactive NCS seniority credit for pregnancy leave prior to
the effective date of the PDA, the majority impose an entirely
gratuitous burden upon AT&T to remedy the NCS seniority
system with respect to all classifications based on pregnancy
occurring before the enactment of the PDA. Bazemore pro-
vides no support for such arbitrary result.

                                 D

   In sum, because there is no evidence that AT&T acted with
the requisite discriminatory intent in 1994 when it calculated
Hulteen’s retirement benefits based in part on the NCS senior-
ity system, Bazemore is inapposite. Without more, the NCS
seniority system simply gives present effect to a past pre-PDA
incident. Under Evans that pre-PDA incident is “merely an
unfortunate event in history [with] no present legal conse-

. For this reason, the Supreme
Court’s logic in the Evans line of authority, reinforced weeks
ago in Ledbetter, controls the outcome of this case. Under that
line, “[a] new violation does not occur, and a new charging
period does not commence, upon the occurrence of subse-
quent nondiscriminatory acts that entail adverse effects result-
  13
    See cases 

n.9.
                HULTEEN v. AT&T CORPORATION               10073
ing from the past discrimination.” 

(emphasis added). The time for Hulteen to have chal-
lenged AT&T’s pre-PDA pregnancy leave rules has long
since expired.

                              IV

                               A

   As the Seventh Circuit recognized in Ameritech, 42 U.S.C.
§ 2000-2(h) “offers good reason to treat seniority systems
with special care, because it specifically exempts discrimina-
tory effects that flow from bona fide seniority systems from
the definition of unlawful employment practices, as long as
the differences are not the result of an intention to discrimi-
nate.” 

; see also Trans World Air-
lines, Inc. v. Hardison, 

, 81 (1977) (“Seniority
systems . . . are afforded special treatment under Title VII.”).
That section states:

       Notwithstanding any other provision of this sub-
    chapter, it shall not be an unlawful employment
    practice for an employer to apply different standards
    of compensation, or different terms, conditions, or
    privileges of employment pursuant to a bona fide
    seniority or merit system, or a system which mea-
    sures earnings by quantity or quality of production or
    to employees who work in different locations, pro-
    vided that such differences are not the result of an
    intention to discriminate because of race, color, reli-
    gion, sex, or national origin, nor shall it be an unlaw-
    ful employment practice for an employer to give and
    to act upon the results of any professionally devel-
    oped ability test provided that such test, its adminis-
    tration or action upon the results is not designed,
    intended or used to discriminate because of race,
    color, religion, sex or national origin. It shall not be
    an unlawful employment practice under this sub-
10074           HULTEEN v. AT&T CORPORATION
    chapter for any employer to differentiate upon the
    basis of sex in determining the amount of the wages
    or compensation paid or to be paid to employees of
    such employer if such differentiation is authorized
    by the provisions of section 206(d) of Title 29.

42 U.S.C. § 2000e-2(h).

   Section 2000e-2(h) provides AT&T no protection in this
case if (1) AT&T’s NCS seniority system is not a “bona fide”
seniority system; or (2) the differences are a result of an inten-
tion to discriminate. Neither exception bars protection of
AT&T’s NCS seniority system here.

   First, the Supreme Court held in International Brotherhood
of Teamsters v. United States, 

(1977), that an
otherwise valid seniority system did not lose its bona fide
character simply because its operation may perpetuate past
discrimination. 

In Teamsters, the Supreme
Court considered a seniority system that allegedly perpetuated
the effects of pre-Title VII discrimination. 

The
employer’s seniority system unmistakably advantaged white
employees who had accumulated longer tenure because of the
“employer’s prior intentional discrimination” against “Negro
and Spanish-surnamed employees” before the enactment of
Title VII. 

The Court stated that it “must decide,
in short, whether [§ 2000e-2(h)] validates otherwise bona fide
seniority systems that afford no constructive seniority to vic-
tims discriminated against prior to the effective date of Title
VII.” 

And the Court concluded that, “[a]lthough a
seniority system inevitably tends to perpetuate the effects of
pre-Act discrimination in such cases, the congressional judg-
ment [through § 2000e-2(h)] was that Title VII should not
outlaw the use of existing seniority lists and thereby destroy
or water down the vested seniority rights of employees simply
because their employer had engaged in discrimination prior to
the passage of the 

. Thus, AT&T’s
NCS seniority system does not lose its bona fide characteristic
                HULTEEN v. AT&T CORPORATION                10075
simply because it gives effect to the pre-PDA pregnancy leave
rules that granted only partial NCS credit for pre-PDA preg-
nancy leave.

   Second, under § 2000e-2(h), “[t]o be cognizable, a claim
that a seniority system has a discriminatory impact must be
accompanied by proof of a discriminatory purpose.” Am.
Tobacco Co. v. Patterson, 

, 69 (1982). But, as the
Seventh Circuit held in Ameritech, “these employees cannot
show the kind of intentional discrimination that would trigger
the exception to the statutory protection afforded to seniority
systems” because “prior to the adoption of the PDA an
authoritative Supreme Court decision had held that Title VII
did not prohibit distinctions based on 

(citing Gilbert, 

). Moreover, because the
PDA is not retroactive, 

n.9, AT&T “would have no
reason to think it had to reshuffle its NCS list after the Act
was passed,” 

, and therefore the
continued reliance on the unadjusted NCS date cannot consti-
tute intentional discrimination.

                                B

   In an effort to frustrate reliance on § 2000e-2(h), the major-
ity simply reads that provision out of the statute in all preg-
nancy discrimination cases. Ante, at 10048-51. The majority
points to the PDA, which states that “women affected by
pregnancy, . . . shall be treated the same for all employment
related purposes, . . . as other persons not so affected but simi-
lar in their ability or inability to work, and nothing in section
§ 2000e-2(h) of this title shall be interpreted to permit other-
wise” (the “§ 2000e-(2)(h) proviso”). 42 U.S.C. § 2000e(k)
(emphasis added). While the majority’s argument has surface
appeal, that proviso cannot bear the burden it attempts to
place upon it.

   First, the majority’s interpretation of that section com-
pletely removes the application of § 2000e-2(h) in all preg-
10076           HULTEEN v. AT&T CORPORATION
nancy discrimination suits under Title VII. Ante, at 10048-51.
But Congress did not go so far. If Congress had intended
wholly to prohibit the application of § 2000e-2(h) in all preg-
nancy discrimination cases, Congress would have expressed
this intent more clearly, as it did with other provisions in the
Civil Rights Act. Compare, e.g., 42 U.S.C. § 2000a(e) (“The
provisions of this subchapter shall not apply to a private club
or other establishment not in fact open to the public, except
to the extent that the facilities of such establishment are made
available to the customers or patrons of an establishment
within the scope of subsection (b) of this section.”); 

(“Sections 2000e-2 and 2000e-3 of this title
shall not apply with respect to the foreign operations of an
employer that is a foreign person not controlled by an Ameri-
can employer.”).

   Second, the conclusion that Congress did not intend that
proviso to remove § 2000e-2(h)’s protection for bona fide
seniority systems in all pregnancy discrimination cases draws
further support from the context in which Congress passed the
PDA. “Congress enacted the Pregnancy Discrimination Act of
1978, amending Title VII to include pregnancy classifications
within the statutory definition of sex discrimination,” in
response to the Supreme Court’s decision in Gilbert. See
Toomey v. Clark, 

, 1437 (9th Cir. 1989). By
amending Title VII to define “because of sex” to include on
the basis of pregnancy, the PDA “in effect overruled” Gil-
bert’s general holding that an employer’s disability benefit
plan did not violate Title VII because it excluded pregnancy-
related disabilities. 

. By adding the
§ 2000e-2(h) proviso to the PDA, Congress did not intend to
remove that section’s protection of bone fide seniority sys-
tems in all pregnancy discrimination actions as the majority
argues, but rather to address a specific anomaly suggested in
Gilbert.

  In Gilbert, the Supreme Court refused to defer to the
EEOC’s interpretation of Title VII to prohibit discrimination
                  HULTEEN v. AT&T CORPORATION                    10077
on the basis of pregnancy, because it appeared to conflict with
another agency’s interpretation of the Equal Pay 

. The last sentence of § 2000e-2(h), the so-
called Bennett Amendment, was the source of the apparent
conflict in Gilbert. The Bennett Amendment provides that
“[i]t shall not be an unlawful employment practice under this
subchapter for any employer to differentiate upon the basis of
sex in determining the amount of the wages or compensation
paid or to be paid to employees of such employer if such dif-
ferentiation is authorized by the provisions of [the Equal Pact
Act, 29 U.S.C. § 206(d)].” 42 U.S.C. § 2000e-2(h). The Equal
Pay Act, in turn, generally authorizes the payment of wages
to employees at a lesser rate than the opposite sex “where
such payment is made pursuant to (i) a seniority system; (ii)
a merit system; (iii) a system which measures earnings by
quantity or quality or production; or (iv) a deferential based
on any other factor other than sex” 29 U.S.C. § 206(d)(1),
quoted in 

n.21.14 In Gilbert the
Supreme Court interpreted the Bennett Amendment, in con-
junction with an agency regulation under the Equal Pay Act,
to permit under Title VII the exclusion of benefits under Title
VII for pregnancy-related disabilities under an employer’s
disability plan. 

itself “pointed in dia-
metrically opposite directions by the conflicting regulations,”
the Supreme Court declined to grant deference to the EEOC’s
interpretation of Title VII to prohibit discrimination on the
basis of pregnancy. 

these reasons, Congress
added the § 2000e-2(h) proviso to foreclose the possibility
raised in Gilbert that the Bennett Amendment would permit
wage discrimination under Title VII on the basis of preg-
nancy.

  In sum, contrary to the majority’s conclusion, the plain
  14
    In County of Washington v. Gunther, 

(1981), the
Supreme Court held that the Bennett Amendment incorporated into Title
VII the four affirmative defenses of the Equal Pay Act in sex-based wage
discrimination cases. 

10078              HULTEEN v. AT&T CORPORATION
meaning of the § 2000e-2(h) proviso in the PDA and the
accompanying context establish that Congress did not intend
to remove the protections of § 2000e-2(h) for bona fide
seniority systems in all pregnancy discrimination actions.
Congress, of course, was free to excise § 2000e-2(h) with
respect to pregnancy discrimination actions. But the majority
reads far too much into the § 2000e-2(h) proviso in the PDA,
and therefore it is the majority, and not Congress, that renders
that section wholly inapplicable in such actions.

                                     V

   The majority also relies on 42 U.S.C. § 2000-5(e)(2) to
shore up its conclusion that Hulteen’s sex discrimination
claim is timely. Congress added § 2000-5(e)(2) to Title VII
with the Civil Rights Act of 1991, Pub. L. No. 102-166, 105
Stat. 1071, 1078-79 (Nov. 21, 1991).15 That section states in
relevant part that

     an unlawful employment practice occurs, with
     respect to a seniority system that has been adopted
     for an intentionally discriminatory purpose in viola-
     tion of this subchapter (whether or not that discrimi-
     natory purpose is apparent on the face of the
     seniority provision), when the seniority system is
     adopted, when an individual becomes subject to the
   15
      The majority contends that the Civil Rights Act of 1991 simply “clari-
fied that injury occurs at the time that the seniority system is applied to
the aggrieved party because that is when the employee is actually harmed
by the deprivation of benefits.” Ante, at 10045 (emphasis added). But the
Supreme Court recently rejected that view. See 

n.2 (“The dissent attaches great significance to [the Civil Rights Act
of 1991], suggesting that it shows that Lorance was wrongly reasoned as
an initial matter. However, the very legislative history cited by the dissent
explains that this amendment and the other 1991 Title VII amendments
‘ “expand[ed] the scope of relevant civil rights statutes in order to provide
adequate protection to victims of discrimination.” ’ ” (emphasis and sec-
ond alteration in original) (citations omitted)).
                   HULTEEN v. AT&T CORPORATION                       10079
       seniority system, or when a person aggrieved is
       injured by the application of the seniority system or
       provision of the system.

42 U.S.C. § 2000-5(e)(2). As the Seventh Circuit succinctly
put it in Ameritech, under § 2000-5(e)(2) “[i]f the employees
are able to show intentional discrimination, their action
accrues at the time they are injured by the seniority system—
that is, when they are denied benefits.”16 

(emphasis added).

   If that section were to apply here, Hulteen’s sex discrimina-
tion action, of course, would have been timely. For § 2000-
5(e)(2) to apply, however, Hulteen would have to establish
that AT&T adopted its NCS seniority system “for an inten-
tionally discriminatory purpose in violation of” Title VII. The
majority boldly asserts that AT&T’s seniority system inten-
tionally discriminates against pregnant women because the
NCS system “ ‘facially discriminates against pregnant women
[because it] distinguishes between similarly situated employ-
ees’ ” and “[f]acial discrimination is ‘by its very terms’ inten-
tional discrimination.” Ante, at 10047 (quoting 

, and Lovell v. Chandler, 

, 1057
(9th Cir. 2002)). But the majority simply ignores the statutory
requirement that Hulteen must show such intentional discrim-
ination at the time the seniority system was adopted.

   Contrary to the majority’s assertion, § 2000-5(e)(2) cannot
serve to revive Hulteen’s sex discrimination charge in this
case. Hulteen cannot show that AT&T adopted the pre-PDA
pregnancy leave rules at the heart of this case with an inten-
  16
    The majority asserts that “[t]he Seventh Circuit’s analysis in Ameri-
tech is problematic because, although it mentioned the Civil Rights Act of
1991, it failed to actually apply it.” Ante, at 10047. Far from ignoring that
Act as the majority suggests, the Seventh Circuit concluded that it did not
apply because the employees failed to show discriminatory intent at the
time the employer adopted the seniority system, a statutory prerequisite.

.
10080              HULTEEN v. AT&T CORPORATION
tionally discriminatory purpose. See also 

(holding that the “employees cannot show the kind of
intentional discrimination that would trigger the exception to
the statutory protection afforded to seniority systems”). First,
the Supreme Court held in Gilbert that Title VII did not nec-
essarily prohibit distinctions based on pregnancy before the
enactment of the 

. There, the
Supreme Court concluded that an employer’s disability bene-
fits plan did not violate Title VII because it failed to cover
pregnancy-related disabilities. Id.17 Second, the Supreme
Court expressly held in Gilbert that classifications based on
pregnancy were not facially discriminatory. 

138; see also 

(“Petitioner’s decision not
to treat pregnancy as a disease or disability for purposes of
seniority retention is not on its face a discriminatory policy.”);
supra pp. 10065-67. AT&T adopted the pregnancy leave rules
at the core of this case before the PDA and changed those
rules prospectively upon the enactment of the PDA in full
compliance with the statute that changed the operative playing
field previously defined by the Supreme Court. Accordingly,
in light of these authoritative Supreme Court precedents,
Hulteen cannot establish that AT&T adopted those pre-PDA
pregnancy leave rules for an intentionally discriminatory pur-
pose in violation of Title VII. See 

.
Absent a showing of discriminatory intent at that time,
§ 2000-5(e)(2) does not apply in this case.
  17
     While erecting a confusing benefits-burdens framework, in Nashville
Gas Co. v. Satty, 

, the Supreme Court reaffirmed Gilbert.
There, the Court concluded that Title VII allowed an employer to deny
benefits to female employees who became pregnant, but Title VII prohib-
ited an employer from imposing on female employees who became preg-
nant a burden that men need not suffer. 

Under that approach,
the Supreme Court in Satty concluded that an employer’s policy of requir-
ing forfeiture of all accumulated seniority for female employees who
became pregnant violated Title VII, 

but, reaffirming Gilbert,
held that an employer’s policy of not awarding sick-leave pay to female
employees who became pregnant did not violate Title VII, 

v. AT&T CORPORATION              10081
                              VI

   As Judge Dumbauld lamented in his dissent to Pallas, we
consider “ ‘a melancholy tale [o]f things done long ago, and
ill-done.’ 

(Dumbauld, J., dissenting) (quot-
ing John Ford, The Lover’s Melancholy). Because Pallas
invented a timely Title VII violation where the determination
of benefits simply gave present effect to past, unchallenged
acts, contrary to Supreme Court authority, it must be over-
ruled. Because the majority today erroneously embraces Pal-
las and perpetuates a circuit split with the Sixth and Seventh
Circuits, I must respectfully dissent.