Willie PENN, Individually, Etc., et al., Plaintiffs-Appellees, v. James R. SCHTLESINGER, Individually and as Secretary of Defense, Etc., et al., Defendants-Appellants, 490 F.2d 700

TUTTLE, Circuit Judge: This interlocutory appeal pursuant to 28 U.S.C.A. § 1292(

b) raises three questions:

(1) Whether racial discrimination in hiring and promotion by federal agencies is actionable by discriminatees;

(2) Whether such claims of discrimination are barred by sovereign immunity; and

(3) Whether these plaintiffs exhausted available administrative remedies before filing suit in federal court. Plaintiffs-appellees Willie Penn, Charles Foster, and the Alabama State Conference of the NAACP, on behalf of themselves, the organization’s membership, and “all blacks in Alabama similarly situated” brought this action against the United States and the individuals heading seventeen federal agencies employing persons in Alabama.

Plaintiffs Penn and Foster, both civilian employees of the Department of Defense at Maxwell Air Force Base in Alabama allege they have been denied promotions or advancement solely because of their race. The district court held that the plaintiffs had stated a claim upon which relief could be granted, that sovereign immunity barred relief against the United States but not against the individual government officials, and that the plaintiffs had sufficiently exhausted their administrative remedies before filing this suit.

The court, while permitting discovery to proceed, allowed the defendants to make an interlocutory appeal on the controlling questions of law involved in the suit. We affirm. I. CAUSE OF ACTION. Assuming for purposes of this interlocutory appeal that the plaintiffs have defined a proper class under Rule 23 and that they were discriminated against by some seventeen federal agencies having offices in Alabama, the question remains whether the plaintiffs have stated a claim upon which relief can be granted. The parties are agreed that Title VII of the Civil Rights Act of 1964 is inapposite.

First, the plaintiffs claim that Executive Order No. 11478, as amended by Executive Order No. 11590, creates a cause of action by discrimina-tees against the federal government. Second, plaintiffs allege that 42 U.S.C. § 1981 enables them to sue the federal government for infringement of their right to make and enforce employment contracts on equal grounds with white citizens. Third, they contend that the Fifth Amendment of the United States Constitution creates a direct cause of action by discriminatees against the federal government.

Since, as will'subsequently appear, we hold the opinion that the complaint states a claim upon which relief can be granted under

Section 1981, we preter-mit the questions whether this claim might also be cognizable under either the Executive Order or the' Fifth Amendment. Our decision in Sanders v. Dobbs Houses, Inc., 431 F.2d 1097 (1970), held that

Section 1981 provided a cause of action to a black employee allegedly discharged solely because of her race. Thus, this

Section creates a cause of action for employment contract discrimination against private employers. Though no decision directly in point has been brought to our attention, we think it clear that the rationale of the Dobbs House decision applies to employment discrimination by federal officials as well as by private employers. In District of Columbia v. Carter, 409 U.S. 418, 93 S.Ct. 602, 605, 34 L.Ed.2d 613 (1973), the Supreme Court said that

Section 1982 is “an ‘absolute’ bar to all such discrimination, private as well as public, federal as well as state.” 409 U. S. at 422, 93 S.Ct. at 605. The Court held that

Section 1982 was intended to prohibit particular types of discrimination regardless of their sources. In this respect,

Section 1982 was contrasted with

Section 1983. While the former was enacted to implement the principles enunciated in the Thirteenth Amendment, the latter legislation, enacted eleven years later, was based upon the Fourteenth Amendment. While

Section 1982 prohibited discriminatory activity from whatever source,

Section 1983 was directed only at discriminatory activities of the states. The narrow question in this case is whether

Section 1981 is more closely analogous to

Section 1982 or to

Section 1983. In our view, there is no doubt but that

Section 1981, like its sister

Section 1982, provides a cause of action against all discrimination against blacks, because of race or color, in the making and enforcement of contracts. Therefore, the allegation that the federal government has violated the plaintiffs’ contract rights on account of their race does state a cause of action under

Section 1981 of the Civil Rights Act of 1866. Hence, we turn to the question whether sovereign immunity bars recovery against the federal government and its employees when an action is brought under

Section 1981. II. SOVEREIGN IMMUNITY. In the first place, we agree with the district court’s analysis that

Section 1981 does not constitute a waiver of sovereign immunity by the federal government. It is well settled that a waiver of sovereign immunity must be specific and explicit; such a waiver cannot be implied by construction of an ambiguous statute. See United States v. Shaw, 309 U.S. 495, 60 S.Ct. 659, 84 L. Ed. 888 (1940); Barefield v. Byrd, 320 F.2d 455 (5th Cir. 1963), cert, denied, 376 U.S. 928, 84 S.Ct. 675, 11 L.Ed.2d 624 (1964). Since

Section 1981 contains no explicit waiver of sovereign immunity by the federal government but merely a general prohibition of discrimination on racial grounds, it does not constitute a waiver of this immunity. Any doubt concerning disposition of this issue was put to rest in our decision of Beale v. Blount, 461 F.2d 1133 (5th Cir. 1972), which held a

Section 1981 suit for in-junctive relief against the federal government to be barred by the doctrine of sovereign immunity. While the plaintiffs concede and the district court held that Beale v. Blount bars this suit as against the government itself, the plaintiffs present two arguments which they contend circumvent the sovereign immunity bar with respect to the individual federal officials. First, they argue that the Fifth Circuit cases of Beale v. Blount and Blaze v. Moon, 440 F.2d 1348 (5th Cir. 1971) constituted improper extensions of the Eighth Circuit case of Gnotta v.

United States, 315 F.2d 1271 (8th Cir. 1969), cert, denied, 397 U.S. 934, 90 S.Ct. 941, 25 L.Ed.2d 115 (1970). While it is true that Gnotta involved review of an administrative finding that no discrimination had been proven while Blaze and Beale were cases in which discrimination had been admitted, we are bound by precedent in this circuit to accept the extension of Gnotta to cases of admitted discrimination.

Second, the plaintiffs contend that Blaze and Beale must be read in light of two Supreme Court decisions which recognize certain exceptions to the doctrine of sovereign immunity in suits against federal officials. Larson v. Domestic and Foreign Commerce Corporation, 337 U.S. 682, 69 S.Ct. 1457, 93 L.Ed. 1628 (1949) and Dugan v. Rank, 372 U.S. 609, 83 S.Ct. 999, 10 L.Ed.2d 15 (1963).

Chief Justice Vinson stated these exceptions to sovereign immunity as follows: “There may be, of course, suits for specific relief against officers of the sovereign which are not suits against the sovereign . . . [First,] where the officer’s powers are limited by statute, his actions beyond those limitations are considered individual and not sovereign actions. The officer is not doing the business which the sovereign has empowered him to do or he is doing it in a way which the sovereign has forbidden.

His actions are ultra vires his authority and therefore may be made the object of specific relief ... a second type of case is that in which the statute or order conferring power upon the officer to take action in the sovereign’s name is claimed to be unconstitutional here, too, the conduct against which specific relief is sought is beyond the officer’s powers and is, therefore, not the conduct of the sovereign.” 337 U.S. 689-690, 69 S.Ct. 1461, 1462. In our opinion, a violation of

Section 1981 by a federal official must be deemed an ultra vires action on the official’s part. Since this federal statute specifically prohibits racial discrimination in the making and enforcement of employment contracts, we cannot infer that federal officials responsible for making employment contract decisions are acting within the scope of their duties on behalf of the sovereign when they act in a racially discriminatory manner. However, since Beale v.

Blount held further that injunctive relief against allegedly racially discriminatory practices by individual federal officials in the Post Office Department was barred by the doctrine of sovereign immunity, we must examine in greater detail the relief requested by the plaintiffs in order to ascertain what relief would, if granted, run against the sovereign rather than merely against an officer of the sovereign acting ultra vires. The plaintiffs did not seek to enjoin these officials from violating

Section 1981. However they did seek “a declaration that the defendants have engaged in a practice of denial of equal right to contract with blacks in Alabama in employment and that such practice is a violation of Title 42 U.S.C. § 1981.” Further, they requested that defendants institute a practice of hiring one black for every one white hired until the ratio of blacks in defendants’ federal jobs in Alabama is approximately in proportion to the percentage of blacks in Alabama’s population.

With respect to the individual named-plaintiffs, Willie Penn sought to require that his rating be increased to G.S. 11 and that he be promoted into the next available position in base procurement for which he is qualified; a further order was sought requiring the Department of Defense to pay him a sum of money, including interest, to represent the salary Penn would have received had he been promoted without regard to race.

Plaintiff Foster requested an order requiring the Department of Defense to increase his rating to no less than G.S. 5 and promotion into the next available position in procurement or elsewhere for which he is qualified, an order requiring back pay for wages he would have earned had he been promoted without regard to race, and an award of damages for humiliation and embarrassment suffered as a result of racially discriminatory practices. In Beale v.

Blount, this court drew a distinction between a claim for injunctive relief and a claim for reinstatement, holding the former barred by the doctrine of sovereign immunity. The latter, being in the nature of a mandamus action, by-passed this obstacle. 461 F.2d at 1137-1138. A declaratory judgment, if equivalent to a claim for injunctive relief would be similarly barred by the doctrine of sovereign immunity. Under other circumstances, it might be more analogous to a mandamus action.

On this interlocutory appeal, with no declaratory order before us, we cannot of course prejudge which classification might be appropriate. The remainder of the relief requested, save the claims for back wages and for damages, both of which would impinge upon the Treasury, are in the nature of mandamus actions. Thus, upon remand, it is within the power of the court (1) to order promotion of the plaintiffs if appropriate and (2) to institute affirmative remedies on behalf of .the class if such remedies are necessary to overcome ultra vires discrimination by the individual defendants. III. EXHAUSTION OF REMEDIES.

Since sovereign immunity does not present a bar to all the relief requested by plaintiffs, we must now turn to the question of whether the plaintiffs sufficiently exhausted available administrative remedies before filing this suit. Before petitioning to the district court, Penn had repeatedly made known his desire for advancement to his white supervisor. This supervisor failed to inform Penn of his right to file a complaint with an Equal Employment Opportunity Officer.

Therefore, Penn did not enter into the latter stages of the Equal Employment Opportunity Commission and Civil Service Commission processes for handling racial discrimination grievances. Plaintiff Foster had likewise complained about his lack of advancement to his white supervisors. One of these, who was also an Equal Employment Opportunity Counselor, had discouraged Foster from prosecuting his complaints administratively.

This supervisor had advised him “that he would have to file a suit if he expected to carry his complaint further.” We must decide whether these actions taken by Penn and Foster, in light of the responses they received from their supervisors, constituted exhaustion of their administrative remedies. It has been decided by this Court that one seeking relief in the federal courts from actions taken by federal administrative agencies must first exhaust the administrative remedies available to him. However, as the Supreme Court pointed out in McKart v.

United States, 395 U.S. 185, 89 S.Ct. 1657, 23 L.Ed.2d 194 (1969), exhaustion of administrative remedies is not a matter of black letter law. The Court there said: “The [exhaustion] doctrine is applied in a number of different situations and is, like most judicial doctrines, subject to numerous exceptions. Application of the doctrine to specific cases requires an understanding of its purposes and of the particular administrative scheme involved.” Id. at 193, 89 S.Ct. at 1662. In 1971, when Penn and Foster filed this suit, the scheme for filing complaints was set out in 5 C.F.R.

Part 713. Under

Section 713.213(a), an aggrieved employee first had to approach a designated EEO Counselor within his agency or branch. This counselor, who was authorized to attempt to settle the grievance informally, was required to advise the employee of his right to file a more formal complaint with the EEO Officer should the informal attempt fail. The filing of a formal complaint under

Section 713.214 triggered an investigation by the agency’s Director of Equal Employment Opportunity (5 C.F.R. § 713.-216). After completion of this investigation and review of the investigative file by the complainant, the agency was required to further provide another opportunity for informal resolution of the complaint. 5 C.F.R. § 713.217(a). If this, too, was unsuccessful, the complainant had to be notified in writing of the agency’s proposed disposition of the complaint and advised of his right to a full evidentiary hearing before an impartial appeals examiner (5 C.F.R. § 713.217(b)).

If a hearing was held, 5 C.F.R. § 713.218, the appeals examiner was required to make findings and analyses of “the matter which gave rise to the complaint and the general environment out of which the complaint arose” and render a recommended decision on the merits of the complaint, “including remedial action, where appropriate.” 5 C.F.R. § 713.218(g). The agency head or his delegate then received these findings and recommended decision, and made a decision for the agency on the information in the complaint file. 5 C.F.R. § 713.221(a).

If the agency head either rejected or modified the recommended decision, the reasons for that action had to be set forth. 5 C.F.R. § 713.221(b)(2). At this point, the agency head could require “any remedial action authorized by law determined to be necessary or desirable to resolve the issues of discrimination and to promote the policy of equal opportunity.” 5 C.F.R. § 713.221(c).

This decision had to be transmitted in writing to the complainant, together with copies of the hearing record and the appeals examiner’s findings and recommended decision, and it had to inform him of his right to appeal to the Civil Service Commission. 5 C.F.R. § 713.-221(

b) and (d). After review by the Civil Service Commission, all the possible administrative remedies which the plaintiffs might have pursued would have been terminated. There is no question but that at this point, suit in federal court alleging that discrimination had occurred and no remedy had been afforded would have been proper. If the plaintiffs had deliberately bypassed their administrative remedies, this suit would clearly be inappropriate. In Beale v. Blount, supra,., the plaintiffs had been invited by postal authorities to file a formal claim of racial discrimination.

Beale failed to do so and argued that presentation of this claim was unnecessary. This court held to the contrary, dismissed the suit for failure to exhaust administrative remedies, and declared : “We adhere to the time-tested requirement that available administrative remedies be exhausted prior to the institution of a mandamus action. The federal bureaucracy’s efforts to police its own practices with respect to discrimination in employment on the basis of race should not be undermined.

This would be the predictable effect of sanctioning resort to the federal courts before completion of the administrative review process.” 461 F.2d at 1139. This suit, however, is substantially different from that of Beale v. Blount. Here, rather than deliberately by-passing their administrative remedies, the plaintiffs approached the administrative officials charged at the first level with responsibility for processing these complaints. The question before us is whether the plaintiffs need have done more before filing suit in federal court.

The defendants contend that further exhaustion would allow the Civil Service Commission to exercise its authority to rectify discriminatory employment practices. They argue further that requiring no more exhaustion than was present here would hamper the achievement of uniformity in the resolution of complaints of discrimination. Finally, they contend that allowing the suit constitutes an uneconomical use of judicial time. There is little merit to these arguments.

First, it was the fault of the agency officials, not the plaintiffs, that the Civil Service Commission was given no opportunity to pass upon the complaints. Second, no disuniformity is created by a rule which says that exhaustion is completed at the point where agency personnel refused to further process grievance and pass them on to the next link in the chain of command. Third, judicial time is not needlessly wasted for our

interpretation of the exhaustion requirement here should help insure that, in the future, federal agencies process such complaints in accordance with their own procedures rather than short-circuiting them into federal court.

For the reasons stated above, the order of the district court granting the United States’ motion to dismiss and denying the individual defendants’ motion to dismiss is affirmed and the case remanded for further proceedings not inconsistent with this opinion. . “When a district judge, . . . shall be of the opinion that such order involves a controlling question of law as to which there is substantial ground for difference of opinion and that an immediate appeal from the order may materially advance the ultimate termination of the litigation, he shall so state in writing in such order.

The Court of Appeals may thereupon, in its discretion, permit an appeal to be taken from such order . . .” . The agency' heads being sued are the Secretaries of the Departments of Defense, Treasury, Interior, Agriculture, Commerce, Labor, Health, Education and Welfare, Housing and Urban Development, Transportation, The Attorney General, The Postmaster General, The Directors of the General Services Administration and The Selective Service System, The Comptroller General, and The Chairman of the Railroad Retirement Board and The National Aeronautics and Space Administration. .

Neither of these questions has yet been litigated. . Though Title VII proscribes unlawful employment practices including racially discriminatory hiring and promotion, the federal government is not included within the definition of “employer” under the Act. 42 U.S. C. § 2000e(b).' . This order, in relevant part, reads : “Section 1.

It is the policy of the government of the United States to provide equal opportunity in federal employment for all persons, to prohibit discrimination in employment because of race, color, religion, sex, or national origin, and to promote the full realization of equal employment opportunity through a continuing affirmative program in each executive department and agency . . . “Section 2.

The head of each executive department and agency shall establish and maintain an affirmative program of equal employment opportunity for all civilian employees and applicants for employment within his jurisdiction in accordance with the policy set forth in

Section 1. It is the responsibility of each department and agency head, to the maximum extent possible, to provide sufficient resources to administer such a program in a positive and effective manner ... “Section 3. The Civil Service Commission shall provide leadership and guidance to departments and agencies in the conduct of equal employment opportunity programs . . “Section 4. The Civil Service Commission shall provide for the prompt, fair, and impartial consideration of all complaints of discrimination in federal employment on the basis of race, color, religion, sex, or national origin.

Agency systems shall provide access to counselling for employees who feel aggrieved and shall encourage the resolution of employee problems on an informal basis.

Procedures for the consideration of complaints shall include at least one impartial review within the executive department or agency and shall provide for appeal to the Civil Service Commission . . . ” . “All persons within the jurisdiction of the United States shall have the same right in every State and Territory to make and enforce contracts, to sue, be parties, give evidence, and to the full and equal benefit of all laws and proceedings for the security of persons and property as is enjoyed by white citizens, and shall be subject to like punishment, pains, penalties, taxes, licenses, and exactions of every kind, and to no other.” (Emphasis added). .

The due process clause of the Fifth Amendment restricts the federal government in some areas which would be covered by the. equal protection clause of the Fourteenth Amendment if applied to a state. See, e. g. Bolling v. Sharpe, 347 U.S. 497, 74 S.Ct. 693, 98 L.Ed. 884 (1954) (holding racial segregation violates due process). . Another Executive Order, which we held did not create such a cause of action, is similar to, albeit distinguishable from, Executive Order No. 11478, See Farkus v. Texas Instruments, Inc., 375 F.2d 629 (5th Cir. 1967).

Though the constitutional claim of racially discriminatory employment practices appears to be closely analogous to the claim of the plaintiffs in Bolling v. Sharpe, supra, the existence of a statutory cause of action under

Section 1981 renders it unnecessary for us to decide whether such private actions as this one are necessary to insure compliance with the due process clause by the federal government. See Bivens v. Six Unknown Named Agents, 403 U.S. 388 at 398, 91 S.Ct. 1999, 29 L.Ed.2d 619 (1971) (concurring opinion by Mr. Justice Harlan.) . Like

Section 1981,

Section 1982 was part of the Civil Rights Act of 1866, enacted pursuant to Congress’s power under the Thirteenth Amendment. . Plaintiff Penn’s motion for a preliminary injunction against the director of the Procurement

Section to prevent her from “intimidating, harassing and threatening plaintiff Willie Penn or any class plaintiff as a result of plaintiff Penn filing his law suit” has not been pressed upon this appeal. We therefore decline to discuss this remedy further. . In Beale v. Blount, supra, the Court drew a distinction between federal court actions against federal officials and federal court action against a state agency or official. This distinction, having been drawn, is binding on us. We cannot accept appellant’s argument, therefore, that we equate the present suit with one in which a

Section 1981 plaintiff may deliberately by-pass administrative remedies under Title VII of the Civil Rights Act. See Caldwell v. National Brewing Company, 443 F.2d 1044 (5th Cir. 1971). . The 1972 Amendments to the Economic Opportunity Act are irrelevant to disposition of the claims herein.