Legal Commentary

My friend Neena (who also clerked for the Hawk) works at the National Women's Law Center. She just circulated the following important letter, which I thought I'd share with the Prawfs community.

The National Women?s Law Center is circulating the attached sign-on letter for lawyers and law students in support of the Fair Pay Restoration Act.  To sign the letter, please go to http://action.nwlc.org/legalletter.

The Fair Pay Restoration Act will reverse the recent Supreme Court decision in Ledbetter v. Goodyear Tire and Rubber Co., which severely limits workers? ability to vindicate their rights and distorts Congress? intent to eliminate sex and other forms of discrimination in the workplace.  For more background information, please check out the summary below. Our goal is to gather support from 1,000 lawyers and law students, before the bill is brought up on the Senate floor. Please help us reach our goal, by signing the letter today and circulating it to your colleagues.

I thought the result of the Ledbetter decision, even if it could be justified on the law (and I'm not saying it can be), was a bad policy. Happily, there's some agitation to get Congress to fix it.  Some more on Ledbetter after the jump, as well as a copy of the letter being circulated to Congress.

Dear Senator:

On behalf of a broad group of lawyers and law students, we urge you to support S. 1843, the Fair Pay Restoration Act. S. 1843 would reverse the Supreme Court?s decision in Ledbetter v. Goodyear Tire & Rubber Co. and help to ensure that individuals subjected to unlawful compensation discrimination are able to effectively assert their rights under the federal anti-discrimination laws.  The bill would reinstate prior law to make clear that compensation discrimination claims accrue whenever a discriminatory compensation decision or practice is adopted, when a person becomes subject to the decision or practice, or when a person is affected by the decision or practice, including whenever he or she receives a discriminatory paycheck.

The Supreme Court?s Ledbetter decision upends decades of precedent to limit severely workers? ability to vindicate their rights.  Under the Ledbetter rule, victims of compensation discrimination have no recourse against ? and employers largely are immunized from liability for ? discrimination unless a charge is filed within 180 days of the employer?s initial discriminatory compensation decision, even when the discrimination continues into the present.  Contrary to Title VII?s intent to encourage voluntary compliance by employers, the Ledbetter decision thus creates incentives for employers to conceal their discriminatory conduct until the statutory period has passed.  As Justice Ginsburg noted in her dissent, after that time the Ledbetter rule renders employers? discriminatory compensation decisions ?grandfathered, a fait accompli beyond the province of Title VII ever to repair.^[1]

More than four decades after Congress outlawed wage discrimination based on sex, women continue to be paid, on average, only 77 cents for every dollar paid to men.  This persistent wage gap can be addressed only if women are armed with the tools necessary to challenge sex discrimination against them. And it is critical that Congress reaffirm that civil rights laws have effective remedies, and that all those subject to compensation discrimination are entitled to challenge continuing discrimination against them. 

S. 1843 would reinstate the ?paycheck accrual rule,? under which each discriminatory paycheck is treated as an act of discrimination that triggers the 180 day statute of limitations under Title VII.  The paycheck accrual rule is the only rule that both furthers the purpose of the anti-discrimination laws and is consistent with their language.  First, the paycheck accrual rule promotes voluntary compliance.  Because each discriminatory paycheck, rather than simply the original decision to discriminate, triggers a new claim filing period, employers have a strong incentive to eliminate any discriminatory compensation practices.  In addition, the rule eliminates the incentive created by the Ledbetter decision for employers to conceal discrimination for 180 days and then be insulated from any challenge. 

The paycheck accrual rule also responds to workplace realities.  Compensation discrimination is different from other types of employment discrimination because of the general secrecy surrounding payroll information in the workplace.  Few employees have concrete information about the decisions underlying their own compensation, let alone the compensation of their coworkers.  And unlike other forms of discrimination, paychecks are not announced, or treated by employees, as adverse employment actions.  As a result, an employee may experience compensation discrimination for a long time before he or she is aware of it. 

The paycheck accrual rule sets the right balance between premature and stale claims.  The rule allows employees to take the time to evaluate and confirm their suspicions of discrimination before filing a charge, thus avoiding the incentive created by the Ledbetter decision to file claims prematurely.  At the same time, employees will continue to have every incentive to file claims of discrimination as promptly as possible, among other things to ensure that they can recover the full amount of backpay that is owed to them.

The Fair Pay Restoration Act simply restores prior law, which had been applied by nine of the ten courts of appeals that have considered the issue, on the basis of Supreme Court precedent before the Ledbetter decision. ^[2] Accordingly, most courts and the Equal Employment Opportunity Commission, as well as most employers, are already familiar with the rule.  Both employers and employees benefit from the certainty created by the rule, which ensures that both plaintiffs and defendants will be able readily to determine the timeliness of claims.

We urge you to enact S. 1843, the Fair Pay Restoration Act, without delay.  Please feel free to contact Jocelyn Samuels, Vice President for Education and Employment at the National Women?s

Law Center, with any questions.

Sincerely,

Background Information:
In Ledbetter v. Goodyear Tire and Rubber Co., the Supreme Court held that employees cannot challenge ongoing compensation discrimination if the employer's original discriminatory decision occurred more than 180 days before, even when the employee continues to receive paychecks that have been discriminatorily reduced. Prior to this decision, the law, as interpreted by the Equal Employment Opportunity Commission and nine of ten courts of appeals that have considered the issue, treated each discriminatory paycheck as a separate discriminatory act that started a new 180-day clock.

Because pay information is often confidential, it may take a long time for an employee to realize that she is experiencing compensation discrimination. And if employers are insulated from liability after 180 days, they have little incentive to correct pay discrimination that occurs. The Fair Pay Restoration Act would restore long-standing law and promote voluntary compliance with anti-discrimination laws by employers.

Other Resources: 

Fair Pay Campaign Website (www.nwlc.org/fairpay)