Ledbetter Act a Lead Weight for Businesses

The Indiana Chamber believes the Lilly Ledbetter Fair Pay Act (S. 181) will do serious harm to America’s businesses in a time when they need anything but more burdens.

The bill recently passed the U.S. Senate, with Indiana’s Senators splitting their votes (Bayh in favor, Lugar against). Our position is that the bill effectively removes the statute of limitations for the vast majority of discrimination cases and would make it easier to sue employers — even decades after the fact.

This legislation responds to the Supreme Court’s decision in Ledbetter v. Goodyear Tire and Rubber Company, 550 U.S. 618, 127 S. Ct. 2162 (2007). Lilly Ledbetter was a Goodyear employee from 1979 to 1998. Around her retirement, Ledbetter filed a charge with the Equal Employment Opportunity Commission alleging pay discrimination because from time to time over the course of her career she received lower pay increases than male co-workers. The Supreme Court ruled that she was required to bring suit within 180 days of the act of discrimination (each decision by her employer to pay her less) and rejected her argument that each paycheck should restart the clock with respect to filing her discrimination lawsuit involving events that happened many years prior. Now, S. 181 would overturn the Ledbetter decision and specify that the statutes of limitations under four discrimination statutes — protecting classes such as age, disability, race, color, religion, sex and national origin — begin anew each time an individual is compensated (if the compensation was affected), essentially eliminating time limits for many claims.

If enacted, this legislation would virtually eliminate the statute of limitations for pay discrimination claims, increase potential damages for employees, limit employer defenses and expand class-action lawsuits. It would make it very difficult to resolve cases in a timely manner and make it more expensive to hire new workers (due to increased litigation costs).

The U.S. Chamber also opposes the measure. Check out their response here.

UPDATE: It’s official as President Obama signed the Ledbetter Act into law on January 29. If you visit its page on Whitehouse.gov, you can view the full text and let the administration know your opinion about this law.