From Bloomberg, “House to Vote on Employment Bills; Business Says Costs to Rise “:
Business groups say the measures, if enacted, would increase costs and expose companies to more lawsuits.
“This scares the heck out of me,” said Drew Greenblatt, owner of Marlin Steel Wire Products LLC in Baltimore. The privately held company makes wire baskets for manufacturers such as Toyota Motor Corp. and drugmaker Roche Holding AG.
Greenblatt, who has testified to Congress about small- business issues, said he expects the wage legislation to lead to higher premiums for his insurance protecting against lawsuits. His premium costs about 2 percent of his total payroll, he said.
“I have my health insurance going up and all these other costs going up,” Greenblatt said. “I just want to make wire baskets.”
Senator Majority Leader Reid has indicated that the Senate may vote next week on the bills, or at least H.R. 11, the Lilly Ledbetter Fair Pay Act. If passed, that means the first major bills of the 111th Congress will be those that discourage hiring by raising the marginal costs of labor, as Drew’s statement demonstrates. Odd priorities at a time of rising unemployment.
Andrew M. Grossman at the Heritage Foundation has written an excellent piece explaining the legal issues involved in the Ledbetter legislation, that is, how the bill would end statutes of limitations in filing wage claims. He makes the critical point that, contrary to the claims of the sponsors, the Ledbetter legislation goes far beyond merely reversing the U.S. Supreme Court decision in Ledbetter v. Goodyear Tire and Rubber.
From “The Ledbetter Act: Sacrificing Justice for ‘Fair” Pay’“:
It was a surprise to many legal observers a year and a half ago that the Ledbetter case–an unremarkable application of a rule settled 20 years prior–would attract any interest at all. But on closer examination, the course of events leading up to the Supreme Court’s decision, and the reaction since, have not been by chance but by design, part of a “perfect storm” orchestrated by trial lawyers, wrongheaded civil rights organizations, and labor groups to achieve a radical shift in employment law. These special interests have an extensive agenda planned for the current Congress. Yet Members should consider each plank of it on the merits.
Far beyond reversing the result of a single Supreme Court decision–one that, viewed fairly, was consistent with precedent and fairly represented Congress’s intentions–the Lilly Ledbetter Fair Pay Act would open the door to a flood of lawsuits, some frivolous, that employers would find difficult or impossible to defend against, no matter their ultimate merit. Rather than help employees, the bill could end up hurting them by reducing wages and job opportunities–at a time when unemployment is rising and many are nervous about their job prospects. Instead, Congress should recognize that statutes of limitations serve many important and legitimate purposes and reject proposals that would allow litigants to evade them.
Earlier posts this week: