Meyers, Roman, Friedberg & Lewis has a Coronavirus Response Team. Contact Jon Hyman to help with how your business should
continue to respond to this national emergency.

Wednesday, April 23, 2008

White House comes out against Ledbetter Fair Pay Act

It's been nearly a year since the Supreme Court decided Ledbetter v. Goodyear Tire & Rubber Co., which held that the statute of limitations for a pay discrimination claim under Title VII begins to run when the pay-setting decision is made, and not when the employee learns of the discrimination. The Ledbetter decision set of a reactionary wave in Congress. Less than 2 months after Ledbetter, the House passed the Lilly Ledbetter Fair Pay Act of 2007, which would amend Title VII, the ADEA, the ADA, and the Rehabilitation Act such that a discriminatory compensation decision occurs each time compensation is paid per that decision. In other words, each receipt of a paycheck would start a new statute of limitations running, regardless of when the actual discriminatory decision was made or implemented.

While the Senate mulls the Lilly Ledbetter Fair Pay Act, the White House has publicly come out against it. From CNN:

The White House said it supports anti-discrimination laws, but that statutes of limitations are crucial in fact-intensive cases. A prompt assertion of discrimination is critical for both employers and employees, the White House said.

"This legislation does not appear to be based on evidence that the current statute of limitations principles have caused any systemic prejudice to the interests of employees, but it is reasonable to expect the bill's vastly expanded statute of limitations would exacerbate the existing heavy burden on the courts by encouraging the filing of stale claims."

I've been on record opposing the Ledbetter Fair Pay Act. It would create a floating statute of limitations for pay discrimination claims, potentially granting all employees the right to sue in perpetuity. Statutes of limitations serve several important purposes, including promoting certainty. Businesses need to know that they will reach a point in time when decisions cannot be challenged in court. Moreover, the more time that elapses between a decision and a lawsuit, memories fade and evidence becomes stale, making it more difficult for a company to rebut the claim. Lilly Ledbetter, for example, sued for a decision nearly 20 years hence. Who at Goodyear still has any knowledge about that decision?