Even with the passage of the Ledbetter Fair Pay Act as the first major piece of legislation this session, some activists and editorialists are saying Congress needs to do even more to “further strengthen current laws against gender-based wage discrimination.” That’s the description the New York Times used in an editorial, but it’s a misrepresentation of what the so-called Paycheck Fairness Act would do. In addition to allowing unlimited punitive and compensatory damages under the Equal Pay Act, the bill would fundamentally the change the ways business are able to make basic business decisions.

The Washington Post highlights this point:

…the new bill allows employers to defend against lawsuits by proving that pay disparities between men and women were based on “bona fide” factors, such as experience or education, and that these factors are tied to business necessities. Fair enough. But the bill also says that this defense “shall not apply” when the employee “demonstrates that an alternative employment practice exists that would serve the same business purpose without producing such differential and that the employer has refused to adopt such alternative practice.” But what if the employer has refused because it has concluded that the alternative is, indeed, more costly or less efficient? What if the employee and employer disagree on what the “business purpose” is or should be?

Diana Furchgott-Roth of the Hudson Institute also examines another aspect of the Paycheck Fairness Act: By changing existing rules concerning collective actions filed under the Equal Pay Act, the legislation would make it significantly easier for plaintiffs’ attorneys to file class action suits.

Also, it would encourage class actions by requiring workers who do not want to participate to opt out, rather than opt in, a radical change from conventional law and practice.  Employers would have to collect data on the race, sex, and wage of all workers and give it to the Equal Employment Opportunity Commission.

The Washington Post reports that President Obama will sign S. 181, the Lilly Ledbetter Fair Pay Act, on Thursday, marking the first bill-signing ceremony of his Administration.

The Post story, “Democrats Overturn Barrier to Unequal-Pay Suits,” closes with this:

Ledbetter said in an interview that she was “thrilled, thrilled.” She said the Supreme Court’s ruling means that she never will be able to claim the $360,000 she was awarded by a lower court. But she said: “The people who are working deserve to have this right. . . . I am so excited, I doubt I will be able to sleep tonight.”

Is that right? She will never be able to claim the $360,000? That might be narrowly true, but it’s clear the legislation was written specifically with her complaint in mind. Note the effective date:

SEC. 6. EFFECTIVE DATE.
This Act, and the amendments made by this Act, take effect as if enacted on May 28, 2007 and apply to all claims of discrimination in compensation under title VII of the Civil Rights Act of 1964 (42 U.S.C. 2000e et seq.), the Age Discrimination in Employment Act of 1967 (29 U.S.C. 621 et seq.), title I and section 503 of the Americans with Disabilities Act of 1990, and sections 501 and 504 of the Rehabilitation Act of 1973, that are pending on or after that date.

So May 28, 2007, is the effective date. The Supreme Court issued its Ledbetter ruling on May 29, 2007, so Lilly Ledbetter’s suit was still pending then. To this non-lawyer’s reading, it seems like she’ll get another shot at litigation.

If Ledbetter attends the bill-signing ceremony, perhaps that’s a topic a reporter could ask her about.

House Majority Leader Steny Hoyer spoke on the floor yesterday prior to House passage of the legislation, a recitation of the main talking points. This paragraph stood out, though:

Opponents of this bill might argue that it will lead to more lawsuits. I’d respond that employers who discriminate could end those lawsuits tomorrow, if they paid their female employees fairly. But until that happens, women who face sexism have every right to get the pay, and the respect, they deserve.

We heard this argument on the Senate side, too: Hey, don’t want to be sued? Then don’t discriminate!

By that logic, every discrimination suit filed against an employer is valid, and attorneys never gin up a complaint to pressure a business into shelling out a settlement. If only that were the case.

Counterargument: Don’t want to get sued? Don’t hire anybody!

House leadership has now set Thursday for the debate over the Lilly Ledbetter Fair Pay Act and the Paycheck Fairness Act, two priority pieces of legislation for core constituency groups of the Democratic Party — organized labor, trial lawyers and left-leaning women’s groups. Both bills passed the House in the last Congress, and we expect they’ll pass the House again.

Both bills were introduced anew yesterday:

H.R.11
Title: To amend title VII of the Civil Rights Act of 1964 and the Age Discrimination in Employment Act of 1967, and to modify the operation of the Americans with Disabilities Act of 1990 and the Rehabilitation Act of 1973, to clarify that a discriminatory compensation decision or other practice that is unlawful under such Acts occurs each time compensation is paid pursuant to the discriminatory compensation decision or other practice, and for other purposes.
Sponsor: Rep Miller, George [CA-7] (introduced 1/6/2009)      Cosponsors (168)
Latest Major Action: 1/6/2009 Referred to House committee. Status: Referred to the House Committee on Education and Labor.
H.R.12
Title: To amend the Fair Labor Standards Act of 1938 to provide more effective remedies to victims of discrimination in the payment of wages on the basis of sex, and for other purposes.
Sponsor: Rep DeLauro, Rosa L. [CT-3] (introduced 1/6/2009)      Cosponsors (175)
Latest Major Action: 1/6/2009 Referred to House committee. Status: Referred to the House Committee on Education and Labor.

Stories…

• Kansas City Star, “Workplace legislation coming to a head in Congress“
• Wall Street Journal, referring to the Employee Free Choice Act in the headline, “Labor Unions’ Top Priority Faces Delay“

And a good one in the Financial Post (Canada), “Battle looms over U.S. labour bills“:

The prospect of sizeable tax cuts in the Obama stimulus plan may have heartened U. S. business and Republicans alike, but a fierce battle is looming over radical changes to U. S. labour policy being vigorously pursued by the Democrats.

The fact that two Democrat-sponsored labour bills are set to be among the first legislation to hit the House floor as the 111th U. S. Congress begins this week is a clear signal the economic crisis has not derailed the new government’s pledge to advance labour’s cause.

The coverage highlights labor’s support for these bills but not the trial lawyer component we talk about here and here.  Yet consider H.R. 12, the Paycheck Fairness Act, which would eliminate the current caps on punitive and compensatory damages in claims made under the Equal Pay Act, allowing huge legal claims against employers for even unintentional pay disparities? Cui bono?

How jarring to see Katie Couric dredge up the “pay gap” canard in her interview with Republican vice presidential candidate Sarah Palin. Couric makes $15 million a year! Pretty good salary for a TV news personality who poses talking points from the labor/grievance caucus instead of coming up with her own informed questions.

That said, Couric’s line of inquiry is useful, more in depth about an employment issue than we’ve seen. Couric should have identifed the bill’s namesake, Lilly Ledbetter, who spoke at the Democratic convention and is now campaigning for Senator Obama’s presidential campaign, but still, a topic worth exploring.

From the CBS transcript:

Couric: The Ledbetter act sort of lengthens the time a woman can sue her company if she’s not getting equal pay for equal work. Why should a fear of lawsuits trump a woman’s ability to do something about the fact that women make 77 cents for every dollar a man makes. And that’s today.

No, that’s not today, and that’s not the case. That premise repeats the usual invidious statistical sophistry used to justify all sorts of government laws, rules and programs. It has been debunked time and time again, as Couric surely knows.

As this testimony from Hudson Institute economist Diana Furchtgott-Roth notes, again:

Just comparing men and women who work 40 hours weekly, without accounting for differences in jobs, training, or time in the labor force, yields a ratio of 88 percent.These wage ratios are computed from aggregate government data and do not take into account differences in education, job title and responsibility, regional labor markets, work experience, occupation, and time in the workforce. When economic studies include these major determinants of income, rather than simple averages of all men and women’s salaries, the pay gap shrinks even more.

A report by Jody Feder and Linda Levine of the Congressional Research Service entitled “Pay Equity Legislation in the 110th Congress,” declared that “Although these disparities between seemingly comparable men and women sometimes are taken as proof of sex-based wage inequities, the data have not been adjusted to reflect gender differences in all characteristics that can legitimately affect relative wages (e.g. college major or uninterrupted years of employment).”

And the Ledbetter act doesn’t not “sort of lengthen” the time you can sue, as Couric claims. It eliminates all statutes of limitations in certain employment suits. You could sue 30 years after the alleged incident under the proposed law, long after the alleged offenders have died or otherwise moved on.

Couric introduced the topic with this “gotcha” question: “Where do you stand on the Ledbetter Fair Pay Act?” How many people who aren’t members of Congress, their staff, or inside the Beltway types would get the reference? Palin did:

Palin: I’m absolutely for equal pay for equal work. The Ledbetter pay act - it was gonna turn into a boon for trial lawyers who, I believe, could have taken advantage of women who were many, many years ago who would allege some kind of discrimination. Thankfully, there are laws on the books, there have been since 1963, that no woman could be discriminated against in the workplace in terms of anything, but especially in terms of pay. So, thankfully we have the laws on the books and they better be enforced.

As a statement of principle, that’s a good one: Don’t discriminate, enforce the law.

And don’t write laws that turn into boons for trial lawyers.

For more, see these posts.

Today Senators Hillary Clinton (D-NY) and Tom Harkin (D-IA) announced the findings of a new Government Accountability Office (GAO) study, using the report to knock the Executive Branch for its alleged failure to crack down on pay inequity. This report recommends:

that the EEOC and OFCCP monitor performance of enforcement efforts more closely and that the OFCCP implement a more rigorous data system to carry out its duties.

Clinton then tried to use this report to justify the Ledbetter bill :

We must hold the Bush Administration accountable for enforcing equal pay requirements already on the books and we must finally end the pay inequity that is short-changing women and families by enacting the Fair Pay Act and the Paycheck Fairness Act,

How would passing a bill that removes the statute of limitations on discrimination claims make the Administration, any Administration for that matter,  more accountable for enforcing current law? This bill will only prevent the timely remedy of actual instances of unlawful discrimination by eliminating the filing periods needed to address real claims. 

Peter List at EmployerReport.com has put together a good list of legislation that could become law if the stars align on the left side of the political hemisphere after the November election. One could quibble, but all in all, it’s representative of organized labor’s electoral and then legislative priorities:

• Employee Free Choice Act (no-vote unionism and binding arbitration 120 days after unionization)
• Elimination of Right-to-Work states (making all 50 states forced unionization states)
• Ledbetter Fair Pay Act (eliminates statutes of limitations on pay discrimination claims)
• Healthy Families Act (mandates seven paid sick days for employers with more than 15 workers)
• Expanding FMLA to include parenting responsibilities (i.e., parent-teacher conferences) and literacy training
• Arbitration Fairness Act (eliminates PRE-dispute arbitration agreements)
• Public Employee-Employer Cooperation Act (unionizes EMS, Fire & Police at the local and state levels)
• WARN Act expansion to smaller companies
• ADA Restoration Act (expands the definition of disability)
• Protecting America’s Workers Act (increases penalties–to include prison time–for employers guilty of “willfully” OSHA)
• Legalizing undocumented workers…and, of course,
• Nationalization of America’s Health Care System 

(Hat tip: Jim Gray)

Lilly Ledbetter, the woman who took her employment discrimination case to the U.S. Supreme Court before finally losing, spoke at the Democratic convention in Denver last night. It was a standard convention speech — short, a statement of grievance followed by advocacy of legislation and praise for the candidacy of Sen. Obama. The remarks are here, and CQ Politics notes how other speakers cited her case. 

You can’t expect policy dissection in 90 seconds, and we’ll also just point to yesterday’s post, which lays out the anti-competitive, litigation-encouraging results of legislation that claims to fix Ledbetter v. Goodyear.

Oh, yes, we’ll also take credit for getting the convention to fix the misspelling of Ledbetter’s first name on the convention agenda. Yesterday, the incorrect Lily. Today, correctly, Lilly. Still wrong here, though. More…