Paycheck Fairness Act

Unfair ‘Paycheck Fairness Act’ Shafts Workers With Hazardous Jobs

by Hans Bader on September 22, 2010 · 1 comment

in Deregulate to Stimulate, Economy, Labor, Legal, Politics as Usual, Regulation, Sanctimony, Zeitgeist

We wrote earlier about the Paycheck Fairness Act, a bill of Orwellian deception that would result in employees unfairly receiving equal pay for unequal work.  It would force some employers to pay employees with dangerous or unpleasant jobs as little as employees with safe and pleasant jobs — as long as the different jobs have different gender breakdowns (that is, if one job is performed mostly by men, and the other job mostly by women — even if the employer does not discriminate in hiring at all, and eagerly hires qualified applicants of both sexes).

Now, it turns out that a lobbyist pushing this disturbing bill met with Senate Majority Leader Harry Reid on September 21, suggesting that the bill may be brought to the Senate floor in the next few days — and that there may be a major push to pass it.  (The Obama administration misguidedly supports the bill; the administration often gets the most basic facts wrong about discrimination and Supreme Court rulings dealing with sex discrimination.)

Labor economist Diana Furchtgott-Roth explains why this bill is a bad idea in The Washington Post.

Paycheck Fairness Act Would Mandate Equal Pay for Unequal Work

by Hans Bader on August 2, 2010

in Economy, Employment, Labor, Legal, Nanny State, Personal Liberty, Politics as Usual, Regulation, Sanctimony, Zeitgeist

The Obama administration wants to force employers to pay some people equal amounts for doing unequal work, through a deceptive bill known as the Paycheck Fairness Act. “Male supermarket managers with college degrees couldn’t be paid more than female cashiers if the college degree for the manager wasn’t consistent with ‘business necessity,’” says economist Diana Furchtgott-Roth in a July 23 column in The Washington Examiner. The bill would also radically increase damage awards for what it labels as “discrimination.”

As I noted in a July 27 letter in response to her column,

Diana Furchtgott-Roth was right to criticize a bill that would require some people who do unequal work to be paid equal amounts. The perverse ‘Paycheck Fairness Act’ is indeed a bad idea. But her column understated the case by suggesting that ‘now,’ an employer found guilty of discrimination is only required to pay ‘back pay,’ not ‘punitive damages.’ Actually, employers already have to pay not only back pay but also damages up to $300,000 under Title VII of the Civil Rights Act. The so-called ‘Paycheck Fairness Act’ would eliminate the cap on punitive damages in gender-based pay discrimination cases, leaving the sky as the limit. Other provisions in this perverse bill could force employers to pay people who do nasty, dangerous, unpleasant jobs as little as those who do nice, pleasant ones, if the unpleasant jobs are performed mostly by members of one gender, and the pleasant ones mostly by the other gender. (Examiner, Pg. 20)

The supporters of the bill falsely claim it would simply treat gender-based pay discrimination the same as other pay-discrimination cases. Lazy journalists sometimes parrot this claim. But it is simply false, as I noted earlier.

The falsehoods may well succeed. In 2009, another bill known as the Lilly Ledbetter Fair Pay Act passed Congress based on false claims about what the Supreme Court held in a pay discrimination case known as Ledbetter v. Goodyear Tire & Rubber Co. (2007). In signing the bill into law, Obama himself misstated the facts and holding of that Supreme Court decision, and broke a campaign promise dealing with transparency in the process.

White House Distorts Ledbetter v. Goodyear Ruling, in Backing Lilly Ledbetter Fair Pay Act

by Hans Bader on January 27, 2009 · 2 comments

in Legal, Politics as Usual

The White House is making false claims about the Supreme Court’s Ledbetter v. Goodyear decision. In that case, the Supreme Court enforced the 180-day deadline for bringing pay discrimination claims contained in the federal discrimination law with the shortest deadline, Title VII. (Other laws, like the Equal Pay Act, have much longer deadlines, like 3 years).

The White House claims that “The Court ruled that employees subject to pay discrimination like Lilly Ledbetter must file a claim within 180 days of the employer’s original decision to pay them less . . . even if the employee did not discover the discriminatory reduction in pay until much later (check out Justice Alito’s arguments in the Court’s opinion).”

This is misleading, and perhaps knowingly so, since the White House links to the very court decision it distorts. First, the Court never said there was a rigid deadline that bars claims by employees who “did not discover” discrimination “until much later.” Ledbetter never argued that the deadline should be suspended based on her employer concealing discrimination against her, because she in fact knew for years about the pay disparity she later sued over. If she truly had been in the dark about the alleged discrimination, she could have sought to take advantage of exceptions to the deadline that suspend it, like waiver, estoppel, and equitable tolling, under the Supreme Court’s decision in Zipes v. Trans World Airlines, 451 U.S. 385, 398 (1982). But she never made that argument, because, as she testified in her deposition, she had been told many years earlier that she was being paid less than the men she later claimed ought to have been paid the same as her.

Nor did she argue that the outcome of her case would have been changed if the Supreme Court recognized an even broader extension to the deadline for employees who are unaware of the discrimination against them, the so-called discovery rule. As the Supreme Court specifically noted in footnote 10 of its opinion, “we have previously declined to address whether Title VII suits are amenable to a discovery rule. . . .Because Ledbetter does not argue that such a rule would change the outcome in her case, we have no occasion to address this issue.” In short, since Ledbetter had long known of the facts underlying her discrimination claim, relaxing the deadline for employees who “did not discover” the discrimination until much later would have done her no good.

Thus, it is wrong for the White House to suggest that the Supreme Court sought to bar claims irrespective of whether “the employee did not discover the discriminatory reduction in pay until much later.”

Second, the Supreme Court expressly noted that the plaintiff could have pressed her claim instead under the Equal Pay Act, which has a longer deadline for suing (usually 3 years) and perhaps more generous accrual rules. But her lawyer foolishly failed to preserve that claim, which was a mistake, as he admitted to the Supreme Court. The Supreme Court responded by noting that “Petitioner, having abandoned her claim under the Equal Pay Act, asks us to deviate from our prior decisions in order to permit her to assert her claim under Title VII.”

The Obama campaign and state democratic parties spent much of the 2008 election season attacking the Supreme Court for supposedly creating a rigid 180-day deadline for pay discrimination claims. Those claims were false.

The fact that the Supreme Court rejected Ledbetter’s claim as untimely should not have been a shock to anyone, given that she waited until shortly before she retired to sue, after the supervisor she accused of discrimination had died.

The Paycheck Fairness Act: Equal Pay Baloney From the Press

by Hans Bader on January 14, 2009 · 7 comments

in Economy, Labor, Legal, Politics as Usual, Regulation, Sanctimony

“News” stories on legislation often read like lazy summaries of press releases put out by the bill’s sponsors. That’s particularly true for so-called “equal pay” legislation, even if it would lead to inequities and frivolous lawsuits.

The Gannett News service is claiming that the controversial Paycheck Fairness Act, which passed the House late last week, simply “elevates the status of gender-based pay discrimination lawsuits to the same level as lawsuits filed by those claiming discrimination based on race, age, or disability.” That echoes press releases by the bill’s sponsors.

But it’s not true. The bill would pressure employers to pay employees in predominantly-female jobs with pleasant working conditions the same as employees in predominantly-male jobs with unpleasant working conditions. Moreover, it would allow people alleging gender-based discrimination to recover damages unavailable to people facing racial, age, or disability discrimination, such as uncapped punitive damages for unintentional “disparate impact” “discrimination” (where a neutral employer practice negatively impacts more women than men, or more minorities than whites).

Federal civil rights law has never permitted punitive damages for unintentional discrimination. It did not permit any punitive damages for most forms of discrimination until 1991, and since then, has limited compensatory and punitive damages in most cases to $300,000. But Gannett News wrongly claims that the Paycheck Fairness Act is simply putting gender discrimination on the same footing as other forms of discrimination by eliminating “the cap on punitive and compensatory damages that has been in place since the early 1990s.” See Brian Tumulty, Clinton’s Last Hurrah: Women’s Pay Fairness, Gannett News, Jan. 13, 2009.

Editorials pushing “pay equity” bills are even worse. They contain blatant errors about Supreme Court’s 2007 Ledbetter v. Goodyear decision on equal pay, which held that a 180-day deadline applied to some pay discrimination claims brought under Title VII of the Civil Rights Act (a longer deadline applies under other laws, such as the Equal Pay Act, which usually gives employees three years to sue).

One recent editorial claimed that Lilly Ledbetter was not allowed to sue more than 180 days after her first unequal paycheck even though “she did not know she was being discriminated against until near the end of her career when she sued.” Another claimed that under the Supreme Court’s Ledbetter ruling, “any employer that could hide discrimination for six months could get away with it.”

In reality, as leading employment lawyer David Copus points out, Ledbetter’s claim was rejected only because she waited for years after suspecting discrimination to sue. See David Copus, “Pay Discrimination Claims After Ledbetter,” Defense Counsel Journal, Volume 75, page 300 (Oct. 1, 2008).

As Copus notes, “Ledbetter admitted at her deposition that ‘different people that [she] worked for along the way had always told [her] that [her] pay was extremely low.’ She recalled that her manager told her in 1992 that her pay was lower than that of other Area Managers, and that by 1994 or 1995, she had learned the amount of the difference. In 1995, Ledbetter told her supervisor that she ‘needed to earn an increase in pay’ because she ‘wanted to get in line with where [her] peers were, because . . . at that time [she] knew definitely that they were all making a thousand [dollars] at least more per month.’” Yet she waited to sue until shortly before she retired, and after the supervisor she accused of discrimination died!

Given Ledbetter’s tardiness and longstanding knowledge that she might have been discriminated against, her lawyer didn’t even claim that she could take advantage of the Supreme Court’s exceptions to the deadlines for workers whose employers conceal evidence of discrimination, leaving them unaware of discrimination, such as “equitable tolling” and “estoppel.”

But in spite of that, the Supreme Court went out of its way to leave such exceptions to the deadline intact, by noting that “Ledbetter should have filed an EEOC charge within 180 days after each alleged discriminatory pay decision was made and communicated to her.’” The Supreme Court also pointedly noted that the plaintiff could have sought relief instead under the Equal Pay Act, which has a three-year deadline for suing (the plaintiff’s lawyer admitted to the Supreme Court that he erred by dropping her Equal Pay Act claim!). It certainly did not rule, as the Los Angeles Times claimed, that “any employer that could hide discrimination for six months could get away with it.” See Editorial, “The Lilly Ledbetter Fair Pay Act Is Back,” Los Angeles Times, Jan. 10, 2009.

But Congress is now on the verge of passing a bill that would essentially eliminate the deadline for suing in pay discrimination cases, the Lilly Ledbetter Fair Pay Act. The bill passed the House on January 9, after supporters falsely claimed that the Supreme Court had imposed a rigid, 180-day deadline for bringing discrimination claims.

Change Is Coming, To Benefit Trial Lawyers

by Hans Bader on January 8, 2009

in Economy, Legal, Politics as Usual, Regulation

Obama promised change, and it’s already happening, at the expense of the poor, consumers, and small business. ”Regulations set to take effect next month could force thousands of clothing retailers and thrift stores to throw away trunkloads of children’s clothing.” That’s the result of a law championed by Obama and trial lawyers, the Consumer Product Safety Improvement Act, which imposes draconian requirements and penalties on sellers of childrens’ toys and clothing. As a result, used clothing stores for poor kids, like Kid to Kid, are going out of business. Some small toy makers will go out of business, and price increases in children’s toys and clothing will also likely result.

The trial lawyers will score another major victory tomorrow, by obtaining House passage of two bills backed by Obama that will greatly expand the ability to sue employers. One, the Lilly Ledbetter Fair Pay Act, would effectively get rid of the statute of limitations in pay discrimination cases. The other, the Paycheck Fairness Act, would pressure some employers to pay people performing different jobs with very different working conditions the same pay, if the different jobs are predominantly held by different sexes, and the different jobs are deemed comparable based on specified statutory criteria.

Supporters of these bills have relied heavily on false claims about what the Supreme Court held in its Ledbetter decision, which did not adopt, as the bills’ supporters claim, a rigid 180-day deadline for bringing pay discrimination cases. (There is a 3-year deadline under the Equal Pay Act, and the 180-day deadline under Title VII, which is simply one alternative avenue for bringing wage discrimination claims, is not rigid, but is subject to equitable “tolling“). False attacks on opponents of the bill were a staple of the 2008 presidential campaign, which featured TV ads from Obama, and mass mailings by state Democratic Parties, falsely claiming that McCain backed wage discrimination against women, simply because he did not support these two bills. Amazingly, the McCain campaign did almost nothing to counter those attacks.