Preparing for Fair Pay Legislation - Part 4

This morning, at 10:20, in the East Room of the White House, President Obama signed the Lilly Ledbetter Fair Pay Act of 2009. Unlike some pundits and legislators, who naively proclaimed the bill would secure fair pay for all, the President's signing statement emphasized that this was "an important step -- a simple fix to ensure fundamental fairness for American workers" but that it was "only the beginning."

As I have explained, the bill changes how the statute of limitations operates when an employee alleged compensation discrimination. It doesn't change the statute of limitations as such. It changes how we have (under the Ledbetter decision) counted when the statute of limitations starts. So, any federal compensation discrimination claim must still (at least in Tennessee) be filed within 300 days of the "unlawful employment practice" (the words Title VII, the ADEA and ADA use). This bill redefines what constitutes the unlawful employment practice for pay discrimination claims. Whereas under Ledbetter, in a Title VII claim, the pay setting decision was the only unlawful employment practice, under this bill, the violation re-occurs with every check that includes a discriminatory payment.

That has long been how the statute of limitations worked under the Equal Pay Act ("EPA"), a statute I discussed in a post a vew days ago. Nothing in Ledbetter changed how the statute of limitations worked under the EPA nor does this bill. Employees can and do sue under the EPA and Title VII in the same suit.

So what will be the effect? If you, as I, believe heightened attention to an issue tends to generate lawsuits (the "lawyers are vultures" theory), then we will see an increase in compensation discrimination claims. And with the way the news media is focused on the economy right now, this bill may not generate any new litigation at all (I am being somewhat facetious).

As a practical matter, the statute of limitations for Title VII will roughly cover the same period of time already covered by the EPA statute of limitations. ("Roughly" is about the right word, too.) The ADEA and ADA changes, of course, are more pronounced but I can count on one hand the number of compensation discrimination claims I have read that are based upon age and disability.

As I previously mentioned, in Tennessee we have (and have had since 2006) a potentially unending statute of limitations for compensation discrimination claims. That hasn't seemed, so far as I have noticed, to lead to a flood of new discrimination lawsuits alleging pay disparites. So if Tennessee is a microcosm of the country, I lean toward being skeptical about the practical effect of this bill.

Of course, it won't hurt to be prepared. More on that later.