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February 2, 2009 |
Schiff Hardin Labor and Employment Alert The Lilly Ledbetter Fair Pay Restoration Act (the "Ledbetter Act") was signed into law last week by President Obama. The Ledbetter Act amends Title VII of the Civil Rights Act, the Americans with Disabilities Act, the Age Discrimination in Employment Act, and the Rehabilitation Act to allow employees to file a wage discrimination charge against their employer up to 180 days, or as many as 300 days in some states, after receiving a paycheck based upon a discriminatory decision. (See Schiff Hardin Labor and Employment Update, January 26, 2009.) The 180-day clock restarts "each time wages, benefits, or other compensation is paid," even if the employer's discriminatory decision took place many years before. The Ledbetter Act authorizes an individual to recover back pay for up to two years preceding the filing of the EEOC charge for discriminatory pay. By its express terms, the Act will take effect retroactively to May 28, 2007, and apply to all claims that are pending on or after that date. This new legislation is expected to generate many new wage discrimination lawsuits. Prior to the passage of this Act, the EEOC received more than 5,000 wage bias charges each year. Now more than ever, employers should review their policies and procedures regarding compensation decisions and ensure that those decisions are based on legitimate factors, such as prevailing labor market conditions and job performance. Employers should also review their documentation procedures for compensation decisions to ensure that they can prove the legitimate basis for those decisions. The Ledbetter Act is the first of many proposed laws aimed at fair pay and discrimination to be enacted by the new administration. The Paycheck Fairness Act (H.R. 12) has already passed the House and has gone to the Senate for consideration. As it currently stands, this Act would allow successful plaintiffs to recover both compensatory and punitive damages for gender-based wage discrimination. It could also increase the number of class action suits brought under the Equal Pay Act by automatically considering class members as part of the class, unless they choose to opt out. In addition, the Paycheck Fairness Act would narrow the affirmative defenses available to employers, making it harder to prove that a compensation decision was made on factors other than gender. The current bill also addresses several other issues, including expansion of acts deemed to be retaliatory and educational programs. ABOUT SCHIFF HARDIN LLP Schiff Hardin's Labor and Employment practice group represents employers and management in all aspects of the employment relationship, including discrimination claims under Title VII, the American with Disabilities Act, the Age Discrimination in Employment Act, and the Fair Labor Standards Act. The firm's employment attorneys have litigated and tried numerous cases in federal and state courts around the country. Schiff Hardin offers clients comprehensive payroll practices and policy reviews, as well as advice, counseling, and training on equal pay issues. For more information, please feel free to contact us. RECENT LABOR AND EMPLOYMENT PUBLICATIONS "Legislation Expanding The Limitations Period For Equal Pay Claims Will Become Law," Labor and Employment Update (January 26, 2009)
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