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Democrats Push Their Equal Pay Bill

April 22, 2008 - by Donny Shaw

UPDATE: The Senate voted not to consider this bill by defeating a procedural motion requiring 60 votes. See how your senator voted here.

April 22nd is generally regarded as a day to celebrate the Earth, but it’s also Equal Pay Day, and the Senate is boosting awareness of this overshadowed holiday by planning a vote on a controversial bill that would strengthen equal pay laws. If the Lilly Ledbetter Fair Pay Act of 2007 were law, the Civil Right Act of 1964 would be amended to make sure that its equal pay protections are available in all cases that pay discrimination occurs, not just when complaints are filed within 180 days of the incident as the law currently requires.

The bill came to be is response to the Supreme Court’s ruling last May in Ledbetter v. Goodyear Tire and Rubber Co. Lilly Ledbetter (pictured at right) had worked for Goodyear Tire and Rubber for 15 years. After discovering that for many years her pay had been 15 percent less than what the lowest-paid male employee in her position had been making, she sued them. The Court rejected her lawsuit, though, noting that Equal Employment Opportunity Commission procedures require claims to be filed within 180 days of when the discrimination took place. The bill bearing her name that the Senate will vote on tomorrow would change the law that was the basis for the Court’s ruling. The bill would make sure that companies can be sued for wage discrimination whenever they issue a paycheck, no matter how long ago the alleged discrimination occurred.

Christy Hardin Smith at <a href=“>Firedoglake points to this summary of the situation from the ”">ACLU:

>…The Ledbetter decision not only reversed years of employment law, it also ignored the realities of a workplace. Often employees don’t know what their co-workers are paid; an expectation that they learn that information within the first 180 days of a pay decision is unreasonable. Unless Congress intervenes, companies will be able to discriminate for years and unjustly profit from paying women, minorities, the elderly, and people with disabilities less, as long as it keeps the discrimination secret for a few months.

>The U.S. House of Representatives passed “The Lilly Ledbetter Fair Pay Act” (H.R. 2831) to correct this problem, and to ensure employers do not profit from years of discrimination based on race, color, religion, sex, national origin, age, and disability, simply because their employees were unaware of the discrimination for 180 days. The bill clarified this wage discrimination is not a one-time occurrence, but rather, that each discriminatory paycheck an employer issues represents an ongoing violation of the law.

Although the bill passed the House, it may not make it through the Senate. Unlike House rules, the Senate has a rule allowing either party to require a 60-vote supermajority. The Republican minority has been using this rule at an unprecedented level in this session of Congress and there’s no doubt they will use it for this bill. Of the 43 co-sponsors the Senate version of the bill has, only two are Republicans. That means that, assuming all 51 Senate Democrats vote for the bill, they will still need to find at least seven more Republicans to cross party lines and vote with them.

The bill’s opponents argue that overturning the statute of limitation that the Lebetter decisions was based on could create new burdens for employees and employers. Here’s the AEI’s Ted Frank explaining why the bill may be a bad idea:

>As I note in my most recent law review article, there is an inverse relationship between wages and legal restrictions on employment-at-will. Two economists working for Rand found in 1992 that wrongful termination suits cause a decline in employment about equivalent to a 10% decrease in wages—and that was before the effects of the Civil Rights Act of 1991 were fully measured.
>Employers are not stupid. To the extent every employee is a potential lawsuit, that is a cost of hiring an employee. As those costs go up, employers will hire fewer employees, and charge “insurance” to the employees they do hire by reducing their wages to account for the possibility of a future lawsuit. If the misnamed “Lilly Ledbetter Fair Pay Act” passes, the vast majority of workers will be worse off, as money that would have gone to pay employees will instead go to pay attorneys. There should be a better reason to pass such harmful legislation than the fact that Ms. Ledbetter’s attorney sued under the wrong statute. If Congress really wishes to help workers, they should reject this legislation, and aim a closer eye at the liability system that hurts our economy.

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