Two Sides of Fair Pay in Bills Before the Senate

THE HOUSE passed two related pieces of legislation last week involving women in the workplace. The Senate is expected to take up the Lilly Ledbetter Fair Pay Act today and should pass it. It should, however, rethink its twin, the Paycheck Fairness Act.

The Ledbetter bill would make it easier for victims of pay discrimination to bring their cases to court. It is a reaction to a 2007 Supreme Court decision that, while a defensible reading of existing law, virtually shut out such plaintiffs from the courthouse. The ruling in Ledbetter v. Goodyear concluded that plaintiffs must file claims of pay discrimination with the Equal Employment Opportunity Commission within 180 days of the original discriminatory pay decision. The practical problem with this scenario is that pay information is not readily shared in the workplace, making it highly unlikely that a woman who received less of a raise than a similarly situated male counterpart would learn of that fact before the deadline. Before the high court's decision, the EEOC and most courts of appeals had determined that each subsequent paycheck that contained the discriminatory pay could serve as a trigger for a complaint.

The Paycheck Fairness Act contains some reasonable measures, such as protecting workers from retaliation if they question pay structures. But it also potentially invites too much intrusion and interference with core business decisions. For example, the new bill allows employers to defend against lawsuits by proving that pay disparities between men and women were based on "bona fide" factors, such as experience or education, and that these factors are tied to business necessities. Fair enough. But the bill also says that this defense "shall not apply" when the employee "demonstrates that an alternative employment practice exists that would serve the same business purpose without producing such differential and that the employer has refused to adopt such alternative practice." But what if the employer has refused because it has concluded that the alternative is, indeed, more costly or less efficient? What if the employee and employer disagree on what the "business purpose" is or should be?

Discrimination is abhorrent, and there is a legitimate role for government, employees and the courts to keep companies honest. The Lilly Ledbetter bill would restore employees' rights to use the courts to address unfairness. The Paycheck Fairness Act risks tilting the scales too far against employers and would remove, rather than restore, a sense of balance.