Managing the Expanding Definition of “Discrimination”: A Practical Review of the Ledbetter Fair Pay Act and Its consequences for Employers

Source: Micahel Brittan and Amy Onder, Employee Relations Law Journal, Vol. 35 no. 2, Autumn 2009
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Earlier this year, President Barack Obama signed the Lilly Ledbetter Fair Pay Act into law following the bill’s passage in the House of Representatives two days earlier. The Fair Pay Act allows individuals and other affected parties to file charges of alleged pay discrimination under title VII of the 1964 Civil Rights Act, the Age Discrimination in Employment Act, the Americans With Disabilities Act, and the Rehabilitation Act. The Fair Pay Act effectively overturns a portion of the US Supreme Court’s decision in Ledbetter V. Goodyear Tire and Rubber Co., Inc. The authors outline the current situation both in terms of how women and other employees fare in equitable pay and what norms exist for setting salaries, negotiation increased pay, determining what factors constitute merit, and evaluating whether recruiting practices have a disproportionately negative effect on pay. The authors believe that previous gender pay gap studies are incomplete and often misleading. While the Act arguably ensures fair pay, some feel that the Act too broadly tolls the statute of limitations period for such claims. Many also fear that employers will now base pay decisions on gender rather than on merit, education, and experience. This article provides proactive steps for employers seeking guidance on practices that ensure fair pay decisions.

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