The NAM’s Opposition to Ledbetter, Fair Pay Act

The following letter registering the NAM’s opposition to H.R. 11, the Lilly Ledbetter Fair Pay Act, and H.R. 12, the Paycheck Fairness Act, went to the House of Representatives yesterday and was released to the media. It is signed by Jeri Kubicki, our vice president, human resources policy:

The National Association of Manufacturers (NAM), the nation’s largest industrial trade association representing small and large manufacturers in every industrial sector and in all 50 states, urges you to oppose H.R. 11, the Lilly Ledbetter Fair Pay Act, and H.R. 12, the Paycheck Fairness Act.

Manufacturers are strongly committed to equal employment opportunity and support vigorous enforcement of anti-discrimination laws. As employers, we are dedicated to fairness in hiring, compensation and job advancement for all employees. Statistics from the Equal Employment Opportunity Commission indicate that “reasonable cause” is found in only 5 percent of the more than 82,000 charges of discrimination that it received in 2007. Unfortunately, these bills will do little to prevent actual instances of unlawful discrimination, but they will open the flood gates to unwarranted litigation against employers at a time when businesses are struggling to retain and create jobs.

H.R. 11, the Lilly Ledbetter Fair Pay Act, would eliminate current time limits for filing almost all discrimination charges. This would result in the removal of necessary incentives for prompt identification and resolution of potential discrimination claims and increase the potential for frivolous litigation. Eliminating this statute of limitation does not benefit the employees or employers. Instead, alleged discrimination could go undetected for many years, subjecting an increasing number of employees to wrongful actions. At the same time, employers would be forced to defend against an avalanche of decades-old, potentially frivolous claims. Prompt filing of claims allows employers to identify and, when necessary, to discipline those managers who may be violating the law.

This bill goes far beyond the issues raised in the Supreme Court’s decision in Ledbetter v. Goodyear Tire & Rubber Co., by eliminating time limitations for claims of alleged employment discrimination in most cases, not just allegations of pay discrimination. This expansive bill would also create a new cause of action for family members or others “affected by” the alleged discrimination while impacting many forms of “compensation” such as pensions.

The Paycheck Fairness Act, H.R. 12, seeks to alter the Equal Pay Act (EPA) to include unlimited punitive and compensatory damages. This would expose employers to increased threats of litigation by making it significantly easier for plaintiffs’ attorneys to file class action suits.

Workers in the U.S. are already adequately and effectively protected from discrimination through remedies available under existing law. The EPA protects men and women from pay disparities in jobs that require equal skill, effort and responsibility and are performed under similar working conditions. This legislation eliminates current caps on punitive and compensatory damages in claims made under the EPA and exposes employers to unlimited damage awards even when unintentional pay disparities may have occurred. The Paycheck Fairness Act would also change the procedural requirements for bringing class action suits under the EPA, resulting in a significant increase in the number of plaintiffs in class actions.

Removing the caps on damages sought by plaintiffs would likely prompt employers to protect themselves by purchasing expanded legal liability insurance. That added burden of insurance would increase the cost of doing business in the United States and may result in a reduction of employees’ wages and benefits and/or the hiring of fewer workers. The Paycheck Fairness Act would almost certainly lower wages and cost jobs for American workers.

The NAM stands ready to work with you to prevent and mitigate workplace discrimination and to restore economic stability; however, these two bills do not support either of these shared goals. We urge Members of Congress to oppose H.R. 11, the Lilly Ledbetter Fair Pay Act, and H.R. 12, the Paycheck Fairness Act.

Thank you for your consideration.


Jeri G. Kubicki

Vice President, Human Resources Policy

National Association of Manufacturers



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