By Barbara Arnwine
Look around your office. Do
you know what your co-workers are really being
paid? Probably not. A recent survey found that
only 10 percent of companies have pay openness
policies. And if you were paid less by your
employer simply because you are female how long
do you think it would take to find out? Probably
not until you’ve been working there a long time,
maybe years.
That is exactly what happened
to Lilly Ledbetter. Her employer, Goodyear, kept
compensation information confidential and it
wasn’t until decades after the fact she found
out that she was being paid less. By the time of
her retirement, she was paid $3,727 monthly,
while the lowest paid male doing the same job
was paid $4,286. Taking her employer to court, a
jury found that she received raises less
frequently than her male colleagues because of
her gender. The jury awarded her damages for
this intentional discrimination, but on appeal
to the Supreme Court earlier this year, a
majority tossed out the award because Ms.
Ledbetter failed to file her claim within 180
days of her employer’s discriminatory decisions
– decisions she didn’t have reason to suspect
until long after they were made.
Pay discrimination based on
gender is a violation of federal law and victims
of such discrimination should be able to recover
lost wages and perhaps other damages as well.
But the Supreme Court has now made it
practically impossible for victims to recoup
damages when they have been discriminated
against.
In order to encourage victims
of discrimination to file their claims promptly,
the law requires that they file within 180 days
of the discriminatory practice. So far, so good.
But the Supreme Court’s decision in Ledbetter
v. Goodyear Tire, interpreted the law to
mean that the 180-day clock starts when the
employer makes the discriminatory decision, not
each time the employee receives a smaller
paycheck. So, if the employee didn’t learn about
her employer’s decision to pay her less when the
decision was made, her claim of discrimination
will probably be too late, even though the
employer continues to pay her less money.
The pattern in the Ledbetter
case is not unusual. In a 2002 case, another
employee didn’t find out about her employer’s
compensation policies until a printout of
salaries appeared on her desk seven years after
her starting salary was set lower than
co-workers. In a 1998 case, the employee found
out about salary disparities when she read about
them in the newspaper. Unlike discriminatory
decisions to hire and fire, compensation
decisions are typically confidential.
Consequently, it makes more sense to start the
clock each time the employer makes a
discriminatory payment rather than when the
decision to discriminate is made.
Ledbetter was a 5-4 decision
in which the conservative majority rejected the
consistent position held by most of the lower
courts for years. Over 20 years ago, in a race
discrimination case, the Court observed that
“each week’s paycheck that delivers less to a
black than to a similarly situated white is a
wrong actionable under Title VII.” This common
sense idea means that if the employee files
within 180 days of receiving the discriminatory
pay, he or she can have their day in court.
Some argue that the clock
should start when a reasonable person would have
discovered the wrong, but this vague standard is
very difficult to apply in a compensation
setting. In particular, employees may learn
about pay differences but might not have enough
information to suspect discrimination until much
later. It’s a cruel joke on the victim if their
clock runs out before they even know it started.
Rather than opening the door
to such time-consuming disputes, a better
approach would be to change the law back to the
definition that worked for decades and that has
proven to be workable for both employers and
employees. As it stands right now the Supreme
Court has practically given employers a loophole
to discriminate, as long as they aren’t found
out in 180 days.
Congress has a lot of
difficult issues to deal with when it returns in
September – Iraq, immigration, the deficit, on
and on. But some problems are easy to solve if
the political will to stand up to the White
House and the business community is there. This
is one of them.
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Arnwine is the executive director for the
Lawyers’ Committee for Civil Rights Under Law
