Ironically enough, on the same day that I’m doing heavy duty statute of limitations research, Barack Obama signed his first law, one that changes in nightmarish ways the statute of limitations governing suits that women and minorities can bring against their employers for claimed inequities in pay.
This issue actually isn’t unfamiliar to readers of this blog. Before I begin, I should explain to those of you unfamiliar with the term that a statute of limitations is a legislatively set time period within which to bring a claim. Depending on the state and the claim, these time periods can vary from as little as six months to as much as 20 years. The average time period to bring most claims clocks in at about 4 years from the plaintiff’s discovery of whatever the injury happens to be.
As for the statute at issue here, I blogged about it a couple of years ago in connection with a reprehensibly dishonest article Jeffrey Toobin wrote for the New Yorker, in which he lambasted the Supreme Court — or, at least, lambasted it from the point of view of the uninformed reader. Here’s what I wrote about the Supreme Court decision regarding an employee’s right to sue for claimed pay inequities:
The first case Toobin goes after is Ledbetter v. Goodyear Tire & Rubber Co., Inc., 127 S.Ct. 2162 (2007). This following paragraph constitutes Toobin’s entire discussion of the case and its outcome:
Moving with great swiftness, by the stately standards of the Court, Roberts, Alito, and their allies have already made progress on that agenda. In Alito’s first major opinion as a justice, earlier this year, he sharply restricted the ability of victims of employment discrimination to file lawsuits. The Court said that plaintiffs in such cases must bring their suits within a hundred and eighty days of, say, an unfair raise. But, because it generally takes employees longer than that to establish that they have been cheated, the effect of the ruling will be to foreclose many lawsuits.
What any sensible reader will understand from this terse summary of the case is that the reactionary Supreme Court, lusting after a return to the 19th Century’s golden era of unfettered employer rights, has foreclosed forever the possibility that employees can claim wage discrimination more than 180 days after that discrimination occurs. In the minds of Toobin’s readers, the justices have placed a permanent wall between these hapless employees and legal redress. Except that this understanding, which is really the only reasonable understanding possible based on the limited information Toobin provides, is entirely untrue.
What the Supreme Court said was that a Federal law imposing a 180 day deadline within which to file a wage discrimination runs from the date the employer makes the decision to discriminate, not from the last paycheck written as a result of that discriminatory decision. That’s all.
Here’s the applicable law as summarized in Ledbetter:
Title VII of the Civil Rights Act of 1964 makes it an “unlawful employment practice” to discriminate “against any individual with respect to his compensation … because of such individual’s … sex.” 42 U.S.C. § 2000e-2(a)(1). An individual wishing to challenge an employment practice under this provision must first file a charge with the EEOC. § 2000e-5(e)(1). Such a charge must be filed within a specified period (either 180 or 300 days, depending on the State) “after the alleged unlawful employment practice occurred,” ibid., and if the employee does not submit a timely EEOC charge, the employee may not challenge that practice in court, § 2000e-5(f)(1).
Ledbetter, 127 S.Ct. at 2166 -2167. In other words, Congress has mandated that if a person claims that her (or his) gender led her (or his) employer to pay her (or him) a discriminatory salary, then that person has either 180 or 300 days from the discriminatory act to file a claim with the EEOC.
Ms. Ledbetter argued that the legislatively vague phrase “alleged unlawful employment practice” should be understood to refer to her paycheck. Her interpretation would mean that every single paycheck starts a new cause of action (and, presumably, reaches back to encompass prior paychecks). Her employer contended that the “alleged unlawful employment practice,” if any such act existed, would be the employer’s decision to pay its employee a discriminatory amount, as opposed to the fruit of that decision (i.e., the paycheck). The Supreme Court carefully analyzed myriad prior decisions and concluded that the employer had the better argument.
Speaking personally, I find Alito’s analysis clear and compelling. As is always the case in the law (or at least mostly the case in the law), one can examine the precedential cases and draw different conclusions or find entirely different cases to act as precedent. The dissent contends that it’s unreasonable to ask people to investigate how their pay ranks against their peers’ pay, and that they should be allowed to wait years, perhaps, before they figure out that they’re getting the short end of the salary stick. By advocating a different standard of responsibility for the employee, the dissent can look to different cases so as to reach a different outcome. And that, from beginning to end, is what Ledbetter is all about.
Knowing what the case is about helps one appreciate what the case is not about: It is not a ruling holding that, henceforth, employees must forever be barred from bringing wage discrimination claims if they don’t figure the problem out within 180 days of their most recent pay raise (or pay raise refusal). The Supreme Court is not making law. It is simply interpreting the law as written in light of case precedent. If the Legislature feels there’s a problem, it can change the law. That last is a singularly important point, since it goes to the heart of the difference between strict constructionists, who limit themselves to interpreting law, and judicial activists, who feel impelled to correct perceived Legislative errors, omissions, and ambiguities.
As I pointed out initially, Toobin’s short, elliptical analysis of the case utterly fails to explain to his readers that the majority was not making a law barring employees forever from complaining about wage discrimination more than 180 days after the fact, but was instead merely interpreting the law as written, leaving the matter open for Legislative change. This serious omission about the impact of a Supreme Court decision forces Toobin’s less informed readers to believe that the Supreme Court has dealt a permanent policy blow to the rights of American workers.
Well, the Democratically controlled Congress took the Supreme Court up on its suggestion that, if people aren’t happy with the current limitations period, the legislature should extend the time within which employees can sue. Who knew, though, that the legislature would enact a law, though, that can expose American businesses to unending damages? From here on out, under the Lilly Ledbetter Fair Pay Act of 2007, a cause of action accrues with every single paycheck. As the ABC news story I heard today pointed out, this means that any statute of limitations is effectively wiped out.
It is theoretically possible, of course, that the act will mean only that a plaintiff can sue to recover the pay differential for a limited number of paychecks preceding the lawsuit, rather than for the entire period of employment. That, however, isn’t really what Ruth Bader Ginsburg envisioned when she dissented in the Ledbetter case:
Under the Court’s decision, the discrimination Ledbetter proved is not redressable under Title VII. Each and every pay decision she did not immediately challenge wiped the slate clean. Consideration may not be given to the cumulative effect of a series of decisions that, together, set her pay well below that of every male area manager.
As a defendant, once you hear the word “cumulative,” you’re in trouble. With the right plaintiff’s attorney and the wrong judge, you’ve got an open door to damages reaching back decades.
It’s important to remember the reason for statutes of limitations: aside from preventing stale claims (vanished documents, dead witnesses, vanished or warped memories), we also have a public policy that protects potential civil defendants from being on the hook forever for erroneous or even malevolent actions from years gone by. If wronged parties cannot be zealous in protecting their own rights, the law used to say “tough luck.” You’re not a baby, and we’re not going to keep people or businesses functioning in a paralyze of fear, wondering for years or even decades if the other shoe is going to drop. This is especially true when the defendants were conforming to normative behavior at the time, even if the behavior was undergoing a paradigm shift — such as the concept of equal pay for equal work, or even equal pay for different, but theoretically equal work.
As a final aside before I leave work/blogging mode, and enter Mom mode, it’s also unnerving how Obama introduced this overarching piece of ostensibly procedural legislation:
It is fitting that with the very first bill I sign – the Lilly Ledbetter Fair Pay Restoration Act – we are upholding one of this nation’s first principles: that we are all created equal and each deserve a chance to pursue our own version of happiness.
This is a procedural correction to existing law, yet it’s being presented as a grand civil rights gesture. More than that, it’s clear that Obama, like Ginsburg before him, has visions of vast compensations, rather than adjustments upon discovery of inequities:
She was just a good hard worker who did her job – and did it well – for nearly two decades before discovering that for years, she was paid less than her male colleagues for the very same work. Over the course of her career, she lost more than $200,000 in salary, and even more in pension and Social Security benefits – losses she still feels today. (Emphasis mine.)
A lot of businesses have to be very nervous right now as they realize that decisions they made, not just a few years ago, when they should have known better, but also in the 60s, 70s, 80s and 90s, may come back to haunt them to the tune of millions of dollars.
P.S. Apologies for typos. I had the time to write, but not proofread. If you find typos, let me know. I’ll also go back and check later.