Employment: Lilly May Helpd Employees Expand Their Right To Sue For Wage Disparity and Provide More Damages To Prevailing Employees

01.01.09

Who is Lilly Ledbetter and why should employers care about her? Lilly Ledbetter was a long term employee of Goodyear Tire & Rubber Company. She sued Goodyear claiming she was paid less than men with comparable experience in comparable jobs. In other words, she claimed that Goodyear had made a discriminatory pay decision in violation of the Equal Pay Act. The Supreme Court ruled that Lilly filed her claim too late. The Court said Lilly’s claim arose when her employer decided to pay her less money, and Lilly did not file her claim within the required period following that pay decision. The Court also ruled that a new claim did not arise every time Lilly received a paycheck that reflected the discriminatory decision. According to the Court, Lilly had one shot and she missed it.

Although the Ledbetter decision was very employer friendly, it provided the basis for two not so friendly pieces of legislation which will be addressed by Congress in 2009. The first bill, the Lilly Ledbetter Fair Pay Act, would amend Title VII, the Age Discrimination in Employment Act, the Americans with Disabilities Act and the Rehabilitation Act of 1973 to overturn the Ledbetter Court’s determination of when the time in which a claim may be brought starts. The Court said it started when the payment decision was made. This proposed legislation says it starts every time an employee receives a paycheck reflecting a discriminatory pay decision. This law will make claims easier for employees, like Lilly, who do not learn about pay differences until long after the pay decision has been made.

The second bill, the Paycheck Fairness Act, would make compensatory and punitive damages available as remedies in Equal Pay Act claims, as well as authorize class action suits. In addition, the Paycheck Fairness Act may make it easier for employees to learn of wage discrimination earlier. The Act would forbid employers from requiring employees to keep their wages secret from each other. Although a ban of this secrecy practice is already included in the National Labor Relations Act and state laws in California and Illinois, many employers continue to insist that discussion of wages is not allowed.

Both of these bills have previously passed in the House. Despite strong support from Senators Clinton and Kennedy, both stalled in the Senate with President Bush threatening to veto the Paycheck Fairness Act if passed. But, with the new administration being viewed as more friendly to these proposed changes to federal law, it is expected that both bills will be reintroduced in 2009. Stay tuned for developments.

By Rebecca M. Fowler, rfowler@dsda.com

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Rebecca D. Bullard

Rebecca D. Bullard

Rebecca represents clients primarily in labor and employment
litigation and counsels clients regarding everyday employment matters. 

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