|
February
25, 2009
The
first bill President Barack Obama signed into law could be the harbinger
of a move toward more employee-friendly legislation, according to local
labor and employment attorneys.
Late
last month, President Obama signed the Lilly Ledbetter Fair Pay Act,
which greatly expands the statute of limitations for gender discrimination
claims related to compensation. It is retroactively effective to May
28, 2007.
The
bill stipulates that every new paycheck that contains an unlawful discrepancy
in pay is considered a separate act of discrimination, allowing an employee
to go back several years or more to cite actions in a lawsuit.
"It
doesn't change or alter any underlying legal principals," said
labor and employment attorney Chris Hoffman, managing partner of Fisher
& Phillips's San Diego office. "What it does is it opens up
the remedies to essentially go back indefinitely in time.
"It
means more litigation. It means more difficult proof issues for employers
because of the time gaps that can occur."
Prior
to the Fair Pay Act, there was a 180-day statute of limitations from
when the first unequal paycheck was issued.
The
legislation effectively reverse a U.S. Supreme Court decision in 2007,
in which, by a 5-4 vote, the justices ruled there was no rolling statute
on pay discrimination claims.
In
that landmark case, Ledbetter v. Goodyear Tire & Rubber Co. Inc.,
Ledbetter claimed her supervisors discriminated against her nearly 20
years ago by paying her less than her male counterparts that performed
the same job.
Even
though she received raises since then, her male colleagues did too,
and she's never been able to catch up. Because compensation rates were
confidential, she didn't realize she was being discriminated against
until recently.
San
Diego attorney Lonny Zilberman, a partner in the employment practice
group of Wilson Petty Kosmo & Turner, agreed the new law
could trigger a flood of pay discrimination lawsuits.
"This
act opens the doors to all of those people who don't even know they've
been discriminated against," he said.
Bill
Whelan, a labor and employment attorney in Sheppard Mullin Richter &
Hampton's San Diego office, isn't convinced the new legislation will
result in an increase in litigation.
He
can't remember the last pay discrimination case based on gender he's
been asked to handle.
"I
think that the cases of true pay discrimination are more isolated now
than they have been historically," Whelan said.
While
the act relaxes the statute of limitations on making a claim, employee
can only seek two years of back pay in damages.
Companies
will have to retain employee records longer than they normally would,
Hoffman said, placing a bigger burden on record keeping.
"How
many people have good records from wage-based decisions 20 years ago,"
Hoffman said. "It's more likely that it will encourage people to
file claims based on a 'who knows' type of theory. Maybe I was paid
differently 15 years ago, so I'll file a lawsuit to find out.
"It's
one of those laws that's clearly well-intentioned, but its practical
impact is it's going to make it extremely difficult on employers to
defend historical actions."
It's
not a coincidence that it's the first bill Obama signed as president,
according to Wilson Petty's Zilberman.
"When
he signed it into law, (Obama) made a statement that essentially said
making the economy work means making it work for everybody," Zilberman
said. "And I think that's a foreshadowing of additional major changes
in employment law coming down the pike."
Another
key piece of legislation being discussed in Congress is the Employee
Free Choice Act, which could mark a landmark change in how unions are
organized.
The
bill would eliminate secret-ballot elections as organizers attempt to
collect authorization from more than 50 percent of a company's workforce
to form a union.
There's
also the Paycheck Fairness Act. The new regulation would allow employees
to get punitive and compensatory damages, it would narrow an employers'
defense, and it would switch the burden to the employer. Zilberman also
said it would prevent employers from claiming employees are paid differently
based on where they live. |
