Implementation and Evaluation: Lilly Ledbetter Fair Pay Act of 2009

The Lilly Ledbetter Fair Pay Act (“the Act”) was a celebrated victory for democrats in 2009. It was hailed as an advancement of civil rights. Overall, the Ledbetter Act had four impacts mainly on its first year set forth by courts.  First, the Act expanded the statute of limitations to allow employees to bring compensation claims every time they receive a paycheck, benefits, or “other compensation” (including years after the alleged discrimination took place). Second, the Act applies to all practices of pay discrimination based on gender, age, race, color, disability, religion, and national origin. Third, the expansion to other practices, such as discreet decision, that practice pay discrimination. Lastly, it applies a greater burden to employers in an effort to mitigate liability when alleged discrimination practices take place.[1] However, the effectiveness of the Act is still debated among the public, officials, and scholars. While some find it to be a success, other believe that it has done nothing but brought false claims putting a burden on the court system and economy. The following cases received attention due to their interpretation of the Ledbetter Act that can either bring the support or criticism of the Act.

Shortly after the enactment of the Ledbetter Act, a case was presented in the U.S. District Court, S.D. New York that set the scene. This notable case is Vuong v. New York Life Insurance Company, 03 Civ. 1075 (TPG). (S.D.N.Y. Feb. 6, 2009). Vuong claimed that New York Life practiced discrimination based on his race, Asia, and national origin, Chinese. Vuong claims discrimination through five acts: in January 1998 New York Life appointed a Vuong as a Co-Managing Partner rather than sole Managing Partner; he proclaims he was promised the sole managing position but after three years but was not promoted; he was then terminated in December 2001 of the co-managing position; in 2002 there was a subsequent failure to promote him to Managing Partner; in 1998 he received lesser compensation (performance related) than his Caucasian co-managing partner.[2] Additionally, he claimed that the subsequent discriminatory practices were retaliation due to his complaints about New York Life’s discriminatory treatment.  The act of giving a higher compensation to his counterpart occurred approximately a year before Vuong filled an EEOC complaint.[3] Meanwhile, New York Life argued that the statute of limitations barred Vuong’s claim of violation of Title VII of the Civil Rights Act. However, the court held that under the Ledbetter Act the claim was timely; Title VII claims were resurrected by the Act. This case established the force of law hat the Ledbetter Act carries and the increase of the statute of limitations. This was seen as not only a push for decreasing the gender wage gap, but a further protection of the other categories under Title VII. Across the United States other cases cited the Vuong case and had similar holdings. To many this is proof that the law has been effective in handling discrimination claims and strengthening civil rights. As expected by supporters of the Act, plaintiffs are able to proceed wage discrimination claims long after the alleged practice initially too place.

Of course, there are limits to the Ledbetter Act that comes to a relief to critics. The expansion of categories has been limited by courts. Specifically, the Ledbetter Act has been barred from expanding Equal Employment Opportunity claims.  In Equal Employment Opportunity Commission v. CRST Van Expedited, Inc., 615 F. Supp. 2d 867 (N.D. Iowa 2009) (U.S. Government Publishing Office 2009)the court held that the Ledbetter Act did not apply to sexual harassment claims. The Court held that Ledbetter Act only deals with compensation; sexual harassment is unrelated.[4]

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Further, the Supreme Court has also created limits to the Ledbetter Act. In AT&T Corporation v. Hulteen, 556 U.S. 701 (2009), the Supreme Court’s holding clarified that an act must result from an intent to discriminate in order to trigger a claim of discriminatory practice.[5] Unlike in the previously mentioned cases, the Court held that the Ledbetter Act could not revive the claim when the act took place before specific legislation took place. The case includes four former and current AT&T employees who claim that not including maternity leaves in the calculation of pension benefits is discriminatory. However, the employer made the pension plan and the alleged discrimination practice before the 1978 Pregnancy Discrimination Act. As a result, the increased statute of limitations did not apply due to the decision not being discriminatory at the time and that before the act employers were permitted to not treat maternity leave and medical leave the same.[6]

Critics have mentioned the ambiguity of the Ledbetter Act’s application of “other compensation” and “other Practices”. As mentioned, the stature of limitations clock starts when an employee is paid a wage, benefits, or other compensation. However, the Act’s lack of guidance as to what “other compensation” means has been criticized but case law has addressed this issue.  In Tomlinson v. El Paso Corp., No. 10-1385 (10th Cir. 2011), the U.S. Court of Appeals affirmed the Colorado District Court’s holding that pension benefits are included in the “other compensation” section of the Act. However, the court rejected the notion of creating a new statute of limitation under the Ledbetter Act to trigger a claim by each retirement check received.[7] Had the court agreed to the contention employees would be able to stretch the limitations period father than the employment relationship.

Critics of the bill, mainly republicans, feared that the expansion of the statute of limitations would bring false claims. However, the EEOC has published Data Summary Reports of Equal Pay Act Charges filed with EEOC that include Title VII, ADEA, ADA, and GINA. In 2000 there were 1,270 receipts, meaning that charges that were filed under EPA and the previously mentioned legislation. The number of charges decreased to 942 in 2009 and 996 in 2017. It has not been a steady decline; the number of cases filed each year fluctuate.[8]  Similarly, resolutions have not fluctuated a lot either. There are nine types of resolutions: settlements, withdrawals with benefits, administrative closures, no reasonable cause, reasonable cause, successful conciliations, unsuccessful conciliations, merit resolutions, and monetary benefits.[9] The majority of cases fall under the No Reasonable Cause resolution that means, “EEOC’s determination of no reasonable cause to believe that discrimination occurred based upon evidence obtained in investigation. The charging party may exercise the right to bring private court action.”[10] There is an average of 58.8% that fall under this category. However, in all resolution types the percentage from 1997 to 2017 has a difference of 5% or less.[11] Thus, the enactment of the Ledbetter Act did significantly increase case work or overwhelmingly favor the plaintiff. 

At the time of the enactment of the Ledbetter Act, President Obama made it clear that the Act was a starting point in his agenda to close the pay gap between women and men.[12] He also pledged to ensure that agencies with responsibility to administer equal pay laws coordinate their efforts and limit gaps for full enforcement.[13] Regarding President Obama’s goal to close the gender wage gap, the law was not effective in that manner. The expansion of the statute of limitations was supposed to discourage the acts and prevent pay discrimination from the source (employers). Research has established the notion of pay differentials a fact and have considered it to be grave. Not only is there a men and women pay disparity but pay disparity within the different races within the gender. While the goals of the statute itself have been effective, the bigger goal of liberals and Obama has not been reached. Since the enactment of the Act, the gender wage gap has not decreased significantly to mark major change. The gap was approximately 20% in 2009 and decreased a mere one percent by 2014.[14]

While the EEOC does file pay discrimination charges, but the Courts have provided the interpretation of the Act and implemented it. The first year after its enactment, the Act saw many citations in court cases that expanded the Act but also put limits. The Vuong case set forth the enforcement of the Act and other courts followed the court’s reasoning and holding. I presented criticisms of the act that it has ambiguous language, but the courts have settled that and created a range of factors that fit in. Overall, the Act has lived up to its legal purpose, but it has not satisfied the larger picture some held. Depending on the stance, legislators can say the policy was effective. The public, who tends to look for fast results and don’t follow case law, might be disappointed in the unchanged wage gap. Thus, implementation was a success through the courts, but the evaluation can differ depending on one’s position and view.

Bibliography

• Brody, Harold M., and Rochelle H. Schultz. 2017. “Supreme Court Clarifies “Prevailing Party” Status under Title VII of the Civil Rights Act and Defers a Decision on the Latest Challenge to the Affordable Care Act ’ s Birth Control Mandate.” https://onlinelibrary.wiley.com/doi/pdf/10.1002/ert.21605.
• CaseText. 2009. “Vuong v. New York Life Insurance Company.” February 6. https://casetext.com/case/vuong-v-new-york-life-insurance-company.
• Congress. 2009. S.181 – Lilly Ledbetter Fair Pay Act of 2009. January 08. https://www.congress.gov/bill/111th-congress/senate-bill/181?q=%7B%22search%22%3A%5B%22ledbetter+fair+pay%22%5D%7D&r=1.
• Cornell University Law School. 2009. “AT&T CORP. v. HULTEEN (No. 07-543) 498 F. 3d 1001, reversed.” https://www.law.cornell.edu/supct/html/07-543.ZS.html.
• Department of Labor. 2015. “Breaking Down the Gender Wage Gap.” https://www.dol.gov/wb/media/gender_wage_gap.pdf.
• Office of the Press Secretary. 2013. “Remarks by the President in the State of the Union Address.” February 12. https://obamawhitehouse.archives.gov/the-press-office/2013/02/12/remarks-president-state-union-address.
• U.S. EEOC. 2018. Definitions of Terms . https://www.eeoc.gov/eeoc/statistics/enforcement/definitions.cfm.
• U.S. Equal Employment Opportunity Commission. 2018. Equal Pay Act Charges (Charges filed with EEOC) (includes concurrent charges with Title VII, ADEA, ADA, and GINA) FY 1997 – FY 2017. https://www.eeoc.gov/eeoc/statistics/enforcement/epa.cfm.
• U.S. Government Publishing Office. 2011. “10-1385 – TOMLINSON, ET AL V. EL PASO CORP, ET AL .” August 11. https://www.gpo.gov/fdsys/granule/USCOURTS-ca10-10-01385/USCOURTS-ca10-10-01385-0/content-detail.html.
• —. 2009. “PUBLIC PAPERS OF THE PRESIDENTS OF THE UNITED STATES: BARACK OBAMA (2009, BOOK I) .” https://www.gpo.gov/fdsys/pkg/PPP-2009-book1/content-detail.html.

[1] (Congress 2009)

[2] (CaseText 2009)

[3] (CaseText 2009)

[4] (Brody and Schultz 2017)

[5] (Cornell University Law School 2009)

[6] (Cornell University Law School 2009)

[7] (U.S. Government Publishing Office 2011)

[8] (U.S. Equal Employment Opportunity Commission 2018)

[9] (U.S. Equal Employment Opportunity Commission 2018)

[10] (U.S. EEOC 2018)

[11] (U.S. Equal Employment Opportunity Commission 2018)

[12] (U.S. Government Publishing Office 2009)

[13] (Office of the Press Secretary 2013)

[14] (Department of Labor 2015)