Connecticut Employment Law Blog : Connecticut Employment Lawyer & Attorney : Daniel Schwartz : Stamford, Hartford New Haven, CT

It's a big holiday today. So, let me be the first to say: Happy Evacuation Day -- at least to my fellow blogger at Compliance Building.  To everyone else, a Happy St. Patrick's Day. 

Its been some time since my last look around the employment law universe, so here's some quick hits of what else has been going on this month:

• Last week, Congress held a hearing on pay equity.  The hearing focused on issues that relate to the Paycheck Fairness Act, sponsored by Senator Christopher Dodd of Connecticut. 
   
• The DOL has been beating the drum louder lately on the issue of employee misclassification. Our webinar on what's new in the area has been rescheduled to March 24th due to a court conflict.  In the meantime, you can play "20 Questions" on this issue with the Ohio Employer's Law Blog. 
   
• Law Tribune Columnist Karen Lee Torre has renewed her suggestion to eliminate the CHRO.  In a new twist, she criticizes the agency for allegedly allowing its employees to have a flexible work arrangement, as if that were unique to the agency or other employers: 

Another feature of the CHRO is its generous and unproductive employee work schedules. I remember getting steamed one time during a fact-finding investigation when we were told we’d have to come back on another day to finish up, even though it was mid-afternoon and we were but two hours away from concluding the evidence. The investigator had one of those democratic work schedules that allowed her to skip out in mid-afternoon to attend to one of her kids. I was forced to schlep to Waterbury again. Thousands more in fees on both sides because a normal work day is anathema to liberals.

• The U.S. Supreme Court has asked for the Solicitor General's views on the Connecticut case of Amara v. CIGNA, a significant case I've discussed at length before that discusses what the obligations are to make disclosures of changes to a pension plan. The Supreme Court is presently considering petitions from the company and the group of former employees that brought suit to take the matter.  A decision from the Supreme Court on whether to accept the petitions is expected by June 2010.
   
• Finally, are you looking for some new labor & employment law blogs to add to your reading list? The Workplace Prof blog recently compiled a list of such blogs.  It contains many of my must-reads in the morning. Take a peek. 

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As those who have been following my tweets know, I have been at the American Bar Association's House of Delegates and midyear meetings. There's lots of substance to these meetings and you can certainly follow along with the ABA Journal.

Among the topics discussed today, was the Paycheck Fairness Act now pending in Congress. If you are not familiar with it, you should be because by all accounts, it's moving front and center this year as an important piece of legislation for the Obama Administration and others.  Rep. Rosa DeLauro of Connecticut is the primary sponsor of the bill in the House of Representatives.

John Phillips reported on this recently. As a result, employers should take stock of their compliance programs and certainly begin a review (if it is not done regularly) of your current compensation procedures.

What does the bill do? John has a good summary but some of the key changes would be to revise the remedies for sex discrimination in the payment of wages by permitting uncapped punitive and compensatory damages and limit employers’ ability to defend against EPA claims. The bill would also prohibit an employer from retaliating against an employee who inquires about, discusses, or discloses his/her own wage or that of another employee unless the disclosing employee has access to that wage information as part of his/her essential job function. 

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There's a relatively new children's book out now entitled, "The Wolf Who Cried Boy". It's a humorous take on the old fable and I read it outloud one evening this week at home.  

I can't help but be reminded of both the classic and new story, reading all of the hyperbole and hype of the last 24 hours regarding the new Ledbetter Fair Pay Act and those who are quick to predict that the floodgates of employment litigation are now open. 

Let's clarify a few issues up front: 

• Is the Ledbetter Fair Pay Act important for employers to understand? Sure, just as all changes to employment laws are important. 
  .
• Does it dramatically change the law? Not really.  Before this law, employers still weren't allowed to engage in pay discrimination; it's just that the time frames for bringing suit under some pay discrimination claims had been defined narrowly by the U.S. Supreme Court in 2007.   This Act extends the time frame for bringing suit by treating each new paycheck as a basis for a discrimination lawsuit, rather than just the original decision to discriminate. 
   
• Will this lead to a dramatic upturn in pay discrimination lawsuits? The jury is definitely still out on this one.  

Here's the greater perspective.  Before the U.S. Supreme Court decision in 2007, women could bring pay discrimination lawsuits under both Title VII's overall scheme, or the Equal Pay Act.  For reasons that are still not fully known (though discussed by National Journal's Stuart Taylor here (H/T Point of Law)) , Ms. Ledbetter did not pursue her Equal Pay Act claim on appeal after it was dismissed on the merits (effectively forfeiting it).  The U.S. Supreme Court ruled only that for pay discrimination claims brought under Title VII, a 180-day statute of limitations applied to pay discrimination decisions.. 

Thus, after Ledbetter, if the employer's discriminatory pay decision occurred in 2007, the employee was out of luck now to sue under Title VII.  Each new paycheck was not an "act" of discrimination. 

The new law treats each paycheck as a new "act" of discrimination, effectively re-starting the statute of limitations each time a paycheck is issued.

But here's why the fuss about the new act is overblown. The employee still could sue under the Equal Pay Act. Indeed, employers should be much more concerned about the Equal Pay Act -- which was unaffected by the Fair Pay Act --  when it comes to pay discrimination claims.  

Unlike Title VII pay discrimination claims, employees do not need to file their Equal Pay Act claims with the EEOC, and claimants have two years in which to file their claim under the Act (three years if the violation is willful).

But here's the kicker for Equal Pay Act claims: The employee does not need to prove discriminatory intent, unlike Title VII.  In fact, the Equal Pay Act focuses on disparity in pay for substantially similar work; contrast that with Title VII which focuses on a discriminatory action that causes a disparity in pay.  So, when the employee is paid less than similarly situated employees of the opposite sex, an Equal Pay Act claim can arise without showing that the employer intended to discriminate. 

Does this mean that employers have no reason to be concerned about the Ledbetter Fair Pay Act? Of course not. The act has the potential of opening of employers to older claims of discrimination against managers and supervisors who have long since gone. But remember, employees will still need to show that the employer intended to discriminate -- a burden that is not insignificant.  And former employees are not going to be able to revive a claim of pay discrimination without a recent "paycheck" to go along with it. 

It's difficult to get exact numbers of pay discrimination claims and look at the numbers of claims filed both before and after the Ledbetter decision came out, but a cursory review of the statistics published by federal agencies under the No Fear Act doesn't seem to reflect a big downturn in the numbers of pay discrimination claims after Ledbetter.  In fact, the United States Postal Service reports more pay discrimination claims being made in 2008 (after Ledbetter), than 2007.  Thus, with Ledbetter effectively being overturned, it's hard to believe that the Act will impact the numbers of claims significantly. 

There is another bill that would change the underlying law that employers should follow closely -- the Paycheck Fairness Act (H.R. 12). The Paycheck Fairness Act would limit an employer’s ability to justify paying different salaries to workers based in different locations with different costs of living. The bill would lift the caps on compensatory or punitive damages for which employers would be liable, in addition to current liability for back pay. These damage penalties would apply to even unintentional pay disparities.

The House passed that bill as part of the Ledbetter Fair Pay Act bill, but the U.S. Senate did not take that up.  Backers of that bill, including Rep. Rosa DeLauro of Connecticut, will continue to press on. 

For employers, the Ledbetter Fair Pay Act should just be another reminder to be vigilant in the monitoring of your compensation practices.  The EEOC's Compliance Manual (H/T Moore) gives some suggestions on the issues that employers can review to determine their compliance with the applicable laws.  

There's little reason for employers to cry "wolf" or "boy" over this latest Act. Stay focused and use this current annual review season to ensure that your pay practices are supported by accurate data and are fair. 

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Earlier today, President Obama welcomed Lilly Ledbetter to the White House and signed the Lilly Ledbetter Fair Pay Act.  You can find the text of the act here and even leave your comments on it. You can read the President's remarks here. And you can find the White House blog entry on the subject here.

In signing the bill, the President said:

So signing this bill today is to send a clear message: that making our economy work means making sure it works for everybody; that there are no second-class citizens in our workplaces; and that it's not just unfair and illegal, it's bad for business to pay somebody less because of their gender or their age or their race or their ethnicity, religion or disability; and that justice isn't about some abstract legal theory, or footnote in a casebook. It's about how our laws affect the daily lives and the daily realities of people: their ability to make a living and care for their families and achieve their goals.

Ultimately, equal pay isn't just an economic issue for millions of Americans and their families, it's a question of who we are -- and whether we're truly living up to our fundamental ideals; whether we'll do our part, as generations before us, to ensure those words put on paper some 200 years ago really mean something -- to breathe new life into them with a more enlightened understanding that is appropriate for our time.

I've covered the bill extensively in prior posts, which you can find here, but some final remarks on this new law for now are worth mentioning:

• The final version of this bill does NOT contain provisions relating to the Paycheck Fairness Act. That bill -- which was originally part of the House version -- did not make it into the Senate version. Thus, the Senate will take that measure up separately, perhaps later this year. 
• The bill is retroactive to May 28, 2007, but as the SCOTUS Blog is quick to remind us, it does not "revive" claims that have already been dismissed with a final judgment: 

The new law, because it would apply to cases still pending that were filed the day before the Court’s ruling, or thereafter, it has the specific effect of overturning the Ledbetter decision. It cannot alter any case that has been finally decided, however. Congress had the authority to overturn the Ledbetter ruling because that was based only on the Court’s reading of a statute, and not a constitutional provision.

• The bill's main purpose is to extend statute of limitations on compensation decisions. But the effect of the bill will be to allow for a potential look back on compensation decisions for several years -- and perhaps much, longer.

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To the surprise of absolutely no one, the U.S. House of Representative overwhelmingly passed two employment law bills addressing compensation issues.  

The Lilly Ledbetter Fair Pay Act, HR 11, pretty much split among party lines 247-171. The Paycheck Fairness Act, HR 12, passed 256-163.  

The bills now move on to the Senate, where the vote is expected to be closer.  

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The Wall St. Journal is reporting this morning that the Employee Free Choice Act bill is not likely to be among the pieces of legislation to be considered in the new administration's first 100 days:

Unions likely won't see action soon on legislation that would make it easier to organize workers, but Democrats are moving to back a pair of less-controversial bills that would facilitate filing discrimination suits against employers.

Labor had hoped the Obama administration would take up the Employee Free Choice Act within its first 100 days. The bill would let unions register members by collecting signatures on cards rather than through elections. But enactment now appears doubtful.

The bill is opposed by business. Mark McKinnon, a spokesman for the Workforce Fairness Institute, a business-backed group that opposes the measure, said support for it is weakening and the business lobby expects to have enough votes to block it with a filibuster, as it did in 2007.

In light of the expected opposition to EFCA, as I reported yesterday, it appears unions and other groups are advocating for the "low-hanging fruit", and seeking passage of the Paycheck Fairness Act and Lilly Ledbetter bill quickly.  The new bill (which combines both aspects of the two prior bills into one) is expected to be considered by the House as early as Thursday.

I've discussed the pros and cons of the EFCA in various posts before. Regardless of the immediate prospects for passage of the EFCA, now is certainly the time for employers to educate themselves about it.  The issue is most assuredly not going away. 

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One of the more interesting television shows out there now is the Emmy award-winning  "The Amazing Race". At the start of the show, the host shouts, "Ready, Set, Go!" and off the contestants go on a race around the world places as yet unknown.

That, in essence, is what 2009 is shaping up to be in employment law: a race to change things as fast as you can with the final destination (and pitstops) as yet unknown.

This week, for example, two employment-law bills are on the fast-track for passage in the U.S. House, but it's being done so quickly that you may have a tough time catching up. 

Several Washington, D.C.- based blogs (including the Washington Labor & Employment Wire) are reporting this site that two pay-related bills are on the fast-track for consideration by Congress, perhaps in an effort to get them on to President-Elect Obama's desk by the time inauguration rolls around.

From the Washington D.C. Employment Law Update:

...House Majority Leader Steny Hoyer (D-Md.) announced that two employment-related bills will reach the House floor later this week. Both the Paycheck Fairness Act (H.R. 1338) and the Lilly Ledbetter Fair Pay Act (H.R. 2831) were introduced and easily passed the House during the last Congress, but stalled in the Senate due primarily to Republican opposition and a presidential veto threat. It is noteworthy that both bills are being sent directly to the House floor instead of being vetted through the committee process....

The Paycheck Fairness Act [version that]... will reach the House floor this week aims to do the following:

• Amend the Fair Labor Standards Act (FLSA) to allow victims of pay discrimination to potentially recover more remedies than those currently provided in the FLSA

• Enforce a new concept of “equal pay for comparable work”

• Prohibit employers from reducing other employees’ wages to achieve pay equity

• Require employers to disclose job categories and pay scales as needed to enforce the law

• Prevent employers from relying on the “factor other than sex” affirmative defense in wage discrimination cases; instead, employers must additionally prove that such factor is “job related” and serves a “legitimate business purpose.” An employee could rebut this claim by showing that an “alternative employment practice” exists that could achieve the same business purpose

• Entitle employees to unlimited punitive and compensatory damages, regardless of whether the wage discrimination was intentional.

You can view some of my earlier posts about the Paycheck Fairness Act starting here.  As I said then, this bill will re-emphasize to employers the importance of documenting pay decisions. 

On the Lilly Ledbetter bill, I summarized it and discussed the issues related to it in posts such as this one.   My comments then are fairly relevant to today as well:

The issue in Ledbetter case was, in many ways, a technical question of how far back an employee should be able to go to challenge past pay practices -- in other words, about deadlines and "statute of limitations". The Supreme Court said that the 180-day deadline found in the statute should apply. Should the statute of limitations remain at 180 days? 1 year? 2 years? 5 years? 20 years? I don't suggest to know what the right answer is. Ultimately, the answer to that question will help shape the Paycheck Fairness Act bill's final outcome and it should be the one that the politicians focus on.   Employers would certainly like shorter statute of limitations and have good arguments that because supervisors leave, short statute of limitations prevent stale claims from being brought. But employees have decent arguments that a longer statute of limitations should apply because discriminatory pay practices are often learned of only after they occur.
 

For employers, the debate over the Paycheck Fairness Act is one worth paying attention to because the real-world consequence of the bill's passage (whether now or next year) will be to increase the importance of documenting pay practices and to give employers another reason to preserve such documents for future litigation.

Hopefully, as the bill progresses, we'll see more debate on the pros and cons on having longer deadlines to file suits.

With the bills on the fast-track, i doubt we'll see much substantive debate on the bills, which is unfortunate. In the election, the concept of "change" was thrown about. This week is the first real sign that, for employment law issues, change is here.

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With the election just two weeks away, employers can start to draw a sharper focus on the national issues at stake in the upcoming Presidential election. That said, much of what will happen will also depend on what happens with various Congressional races.  In other words, even if Senator McCain is elected President, we're still likely to see various issues raised in the next session of Congress.

Michael Moore has a terrific piece this week outlining the various bills that are likely to get debated after the election.  I'll be discussing some of them in upcoming posts (as well as issues relating to Connecticut's races), but Michael's post provides a good roadmap to the bills.

Among them:

Employee Free Choice Act (H.R. 800 and S. 1041)

Summary:  The EFCA amends the NLRA to change the procedures for union certification and first contract negotiation.

Employment Non-Discrimination Act (H.R. 3685/ no Senate Bill)

Summary:  ENDA adds sexual orientation to the protected classes under Title VII for all employers except religious organizations.

 Ledbetter Fair Pay Act (H.R. 2831/ S. 1843)

Summary:  FPA overturns the Supreme Court’s decision in Ledbetter v. Goodyear Tire and Rubber Co. effectively eliminating the 180 or 300-day statute of limitations for filing a wage-related discrimination claim.

Paycheck Fairness Act (H.R. 1338/ S. 766)

Summary:  PFA changes the burden of proof in gender based pay claims requiring the employer to affirmatively demonstrate that any pay differential is not based on sex.

RESPECT ACT (H.R. 1644/ S. 969)

Summary:  The so-called Re-Empowerment of Skilled and Professional Employees and Construction Tradesworkers (RESPECT) Act would change the NLRA definition of “supervisor” to exclude “working supervisors” who do not spend a majority of their worktime in strictly managerial duties excluding the tradition duties of assigning work and directing the activities of others.

The post also discusses the impact that each bill would have on existing law and the candidates' respective positions. 

(For another take, see The Word on Employment Law's collection of posts on the issues here.)

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 You might have missed it in the midst of the discussion of abortion and the Supreme Court but the issue of pay discrimination got a brief airing by Senator Obama during Wednesday's Presidential Debate. (You can view the transcript here). 

Here was the entire portion:

Obama: So this is going to be an important issue. I will look for those judges who have an outstanding judicial record, who have the intellect, and who hopefully have a sense of what real-world folks are going through.

I'll just give you one quick example. Sen. McCain and I disagreed recently when the Supreme Court made it more difficult for a woman named Lilly Ledbetter to press her claim for pay discrimination.

For years, she had been getting paid less than a man had been paid for doing the exact same job. And when she brought a suit, saying equal pay for equal work, the judges said, well, you know, it's taken you too long to bring this lawsuit, even though she didn't know about it until fairly recently.

We tried to overturn it in the Senate. I supported that effort to provide better guidance to the courts; John McCain opposed

I think that it's important for judges to understand that if a woman is out there trying to raise a family, trying to support her family, and is being treated unfairly, then the court has to stand up, if nobody else will. And that's the kind of judge that I want.

Schieffer: Time's up.

McCain: Obviously, that law waved the statute of limitations, which you could have gone back 20 or 30 years. It was a trial lawyer's dream.

The subject was the decision in Ledbetter v. Goodyear.  The Manpower blog has a post earlier this week on the case that summarized it pretty succinctly (if overly so).  There's been a lot written on it as well including this good piece from The Word on Employment Law this spring. 

Unfortunately, the case has gotten so whittled down to a soundbite that the central holdings of the case -- regarding statute of limitations -- gets lost.  But you can read the bill that was proposed last year here.

 I summarized the issue in a post this summer: on a related bill, the Paycheck Fairness Act and reviewing it again, I think my comments are fairly on point with what occurred in the debate.

The issue in Ledbetter case was, in many ways, a technical question of how far back an employee should be able to go to challenge past pay practices -- in other words, about deadlines and "statute of limitations".  The Supreme Court said that the 180-day deadline found in the statute should apply. 

Should the statute of limitations remain at 180 days? 1 year? 2 years? 5 years? 20 years?  I don't suggest to know what the right answer is.  Ultimately, the answer to that question will help shape the Paycheck Fairness Act bill's final outcome and it should be the one that the politicians focus on. 

Employers would certainly like shorter statute of limitations and have good arguments that because supervisors leave, short statute of limitations prevent stale claims from being brought. But employees have decent arguments that a longer statute of limitations should apply because discriminatory pay practices are often learned of only after they occur. 

For employers, the debate over the Paycheck Fairness Act is one worth paying attention to because the real-world consequence of the bill's passage (whether now or next year) will be to increase the importance of documenting pay practices and to give employers another reason to preserve such documents for future litigation.   

Hopefully, as the bill progresses, we'll see more debate on the pros and cons on having longer deadlines to file suits.

We didn't hear much in the specifics tonight but we'll see if anything transpires in the closing weeks of the election.

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Earlier this month, I provided a legislative update on the Paycheck Fairness Act bill, which passed the U.S. House of Representatives. Long-time Congresswoman Rosa DeLauro (D-Conn, 3rd) has been a leading sponsor of the bill and she has a long and distinguished career in the House. 

Yesterday, Rep. DeLauro issued a column in the Huffington Post about the bill.  Front and center in her discussion is the case of Lilly Ledbetter and her lawsuit against Goodyear Tire & Rubber Company that went before the U.S. Supreme Court.  

As a result, Rep. DeLauro says that the bill would close the "loopholes" in the law.

On Thursday July 31st, the House of Representatives took the next step to correct this injustice by passing H.R. 1338, the Paycheck Fairness Act by a vote of 247-178. This vote was about ensuring that women who work hard and productively and carry a full range of family responsibilities are paid at a rate they are entitled. So many employers and companies do the right thing as a matter of course, but passing this bill says that this is now a matter of right and wrong, that discrimination is unacceptable anywhere and we are all diminished when we fall short. We have the chance to make all men and women whole and contribute to the richness of America. 

What's fascinating is the fact that the Ledbetter case has gotten intertwined in the political arena (in fact, Ms. Ledbetter will be a featured speaker at the Democratic National Convention on Tuesday).  The issue in Ledbetter case was, in many ways, a technical question of how far back an employee should be able to go to challenge past pay practices -- in other words, about deadlines and "statute of limitations".  The Supreme Court said that the 180-day deadline found in the statute should apply. 

Should the statute of limitations remain at 180 days? 1 year? 2 years? 5 years? 20 years?  I don't suggest to know what the right answer is.  Ultimately, the answer to that question will help shape the Paycheck Fairness Act bill's final outcome and it should be the one that the politicians focus on. 

Employers would certainly like shorter statute of limitations and have good arguments that because supervisors leave, short statute of limitations prevent stale claims from being brought. But employees have decent arguments that a longer statute of limitations should apply because discriminatory pay practices are often learned of only after they occur. 

For employers, the debate over the Paycheck Fairness Act is one worth paying attention to because the real-world consequence of the bill's passage (whether now or next year) will be to increase the importance of documenting pay practices and to give employers another reason to preserve such documents for future litigation.   

Hopefully, as the bill progresses, we'll see more debate on the pros and cons on having longer deadlines to file suits.

Lastly, employers should not lose sight of other potential claims that can still arise, regardless of what happens with the Paycheck Fairness Act legislation. Indeed, the irony of the Ledbetter case is that there already exists a law that would have permitted Ledbetter to sue. The Equal Pay Act specifically addresses pay disparity and has a longer statute of limitations. But for some reason, Ledbetter's attorney chose to sue under the all-purpose anti-discrimination law, Title VII, thus dooming her claims.

(H/T: Rep. DeLauro cross-posted her statement at My Left Nutmeg)

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In the waning hours late last week before Congress took its summer vacation, Congress was busy debating (or in some cases, not debating) some key employment bills.  These all still require approval from the one side of Congress or the other, but these bills are getting closer to becoming law.  (For a refresher on how a bill becomes a law, you can always click here.)

Paycheck Fairness Act

Long-time Representative Rosa DeLauro, from the Third Congressional District in Connecticut, must be a happy camper this week after the Paycheck Fairness Act she sponsored passed the House of Representatives on July 31st by a 247-148 vote.  The bill would limit the defenses employers have to an Equal Pay Act claim and amend the FLSA to add claims for compensatory damages and punitive damages.  (H/T Workplace Prof)

The bill now goes on to the Senate for a voice where its prospects are far from clear. Groups like the Heritage Foundation claim the act would "give[] a windfall to trial lawyers, exposing employers to unlimited punitive damages for unintentional mistakes."  On the other hand, others, like the National Women's Law Center, claim the bill would merely close the "gender gap" that still exists.  It should be noted that this bill differs from the "Fair Pay Act".

ADA Amendments Act (f/k/a ADA Restoration Act)

After passing the House earlier this year, the ADA Amendments Act of 2008 has stalled at the Senate.  However, late last week, Senator Tom Harkin and Senator Orrin Hatch introduced a new bill (S. 3406) that makes two significant changes to the House bill.  You can download the text of the bill here.   With 64 co-sponsors, these changes are getting close enough to win over support of the business community (and ward off a veto threat).  If passed, this new bill would need to be reconciled with the bill passed by the House earlier this year.   

What are the two changes?

• First, the bill eliminates a definition for "substantially limits", which was in the House bill.  The new bill would advise courts to simply consider impairments that are of central importance of people's day-to-day activities.
• The other change will only affect the education-related portion of the bill.  That change now says that reasonable modifications to educational policies are not mandated if the modifications would fundamentally change the program. 

E-Verify Extension

Florida Employment Law Blog reports that the House of Representatives has approved a bill that would extend E-Verify, the federal government's electronic employment verification system, by five years.  The bill, HR 6633 or the Employee Verification Act of 2008, passed by a 407-2.

The bill now moves to the Senate for a vote; however, the Senate is in recess for the next five weeks.

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