The Supreme Court agreed yesterday to decide whether male and female workers who put in equivalent service and contributions can receive unequal retirement benefits, a case that could have a profound effect on the American life insurance industry.
Insurance companies, which administer a number of private pension plans, have traditionally paid lower pension benefits to women because they live longer on the average.
The case, Arizona Governing Committee vs. Norris, is based on the Arizona retirement system, which has been found by the lower courts to violate female employes' civil rights.
Under that plan, men and women make comparable voluntary contributions to a deferred payment plan. Upon retirement, the employe can collect the money in a lump sum, receive monthly payments or can participate in a separate annuity program handled by independent insurance companies.
But under the annuity program, the insurance companies provided lower annuity payments to women than to men, based on their life expectancy.
The state claims in its brief that it is not to blame because all the life insurance companies it deals with used sex-based actuarial tables.
The American Council of Life Insurance, the largest life insurance trade group in the country, argued in a friend-of-the-court brief that if the lower court findings are affirmed, it would "revolutionize the insurance and pension industries."
Following the lower court decisions, Arizona stopped offering the annuity option to any employes. The state is being forced to make up the difference in payments to women who have already retired.
The life insurance council added in its brief that the annuity funds would become insolvent if they paid everyone at the rate for males. It added that a plan paying less than the current male rates "would always be subject to adverse selection by male employes."
In another case dealing with the rights of female employes, the court refused to block a suit against American Cyanamid, a giant chemical company that required women working with certain toxic substances to be sterilized or transfer to other jobs.
Cyanamid adopted its "fetus protection policy" at its Willow Island, W.Va., plant in 1977 and gave female production workers between the ages of 16 and 50 until April, 1978, to be sterilized or request a transfer. Five women were sterilized. Two were transferred to lower paying jobs with inferior benefits.
The case, American Cyanamid vs. Oil, Chemical and Atomic Workers International Union, was brought by the union under the Occupational Safety and Health Act. The union lost the initial round and appealed to the U.S. Circuit Court of Appeals for the District of Columbia. The chemical company asked the Supreme Court to block the union's appeal of the case to the appellate court. But the Supreme Court refused to intervene.
In the area of freedom of the press, the court rejected challenges to two lower court rulings that New Jersey's media shield law gives journalists there the absolute right not to disclose notes, sources or editorial procedures when they are sued for libel.
Both New Jersey cases involved separate libel suits against New Jersey Monthly magazine filed by Resorts International Inc. and former state senator Joseph Maressa.
The magazine had alleged that Resorts International was a mob-tainted company and placed Maressa on a list of the alleged 10 worst lawmakers in the state legislature. Both Resorts International and Maressa filed libel suits demanding disclosure of notes and confidential sources. But the Supreme Court found New Jersey's press shield law forbids such disclosures in libel cases.
Twenty five other states have similar shield laws.
In another case, the court rejected the efforts of five states to force a reporter for an oil industry newsletter to reveal confidential sources and turn over his notes. The states wanted the materials to support their allegations of a price-fixing scheme by 17 oil companies.
In a fourth press case, the court voted 7 to 2 to reject a politician's motion to reinstate a $1 million libel verdict against two Oklahoma City newspapers.
George Mikovsky got widespread attention in his 1978 campaign for the Senate when he charged that Sen. David L. Boren (D-Okla.) was a homosexual. But he accused the Daily Oklahoman and the Oklahoma City Times of libeling him after his campaign charges backfired and he faced serious criticism in those newspapers.
Mikovsky won in the lower court, but the state supreme court reversed the decision. Justices William H. Rehnquist and Byron R. White said they would have chosen to hear Mikovsky's arguments.
In other actions, the court:
* Agreed to resolve a water-use dispute between the Pyramid Lake Paiute Indian Tribe and other residential, agricultural and industrial water users including the city of Reno, Nev., over the Truckee River. The Indians claim water diversion has all but wiped out their supply of fish: the Lahonton cutthroat trout, now listed as a threatened species, and the cui-ui fish, now officially endangered.
* Asked the Justice Department for its views on whether newspapers that dominate their regions can reject certain advertising without violating antitrust laws.
* Let stand a ruling that handicapped persons may sue a public school district under the 1973 Rehabilitation Act for being denied an adequate education.