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Senate May Take Up Another Pay Bill Before End of Term

March 12, 2010
Related Topics: Financial Impact, Compensation Design and Communication, Future Workplace, Latest News
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One of the first pieces of legislation approved by the current Congress in January 2009 made it easier for workers to sue for pay discrimination.

 

It was named after Lilly Ledbetter, a former Goodyear tire factory supervisor whose Supreme Court case ruling was overturned by the bill that bore her name.

 

Democrats and advocacy groups hope that before the congressional term ends this fall, a companion measure will be on President Barack Obama’s desk.

 

The Paycheck Fairness Act would allow employees to pursue unlimited compensatory and punitive damages in pay suits and make it more difficult for employers to defend against them.

 

The House has passed both bills. The Senate approved the Ledbetter legislation but put the paycheck bill on hold. The measure was revived at a hearing of the Senate Health, Education, Labor and Pensions Committee on Thursday, March 11.

 

Proponents said the bill would help women pull even with men in compensation levels, asserting that women make only 77 cents for every dollar that men earn. The issue takes on more urgency during a recession, they said, because women are the sole breadwinners in many households.

 

“This isn’t just a matter of fairness,” said Sen. Christopher Dodd, D-Connecticut and a longtime champion of pay equity. “It’s a matter of economic security for many families.”

 

Opponents countered that the bill threatens businesses with a spike in lawsuits that could undermine job creation.

 

“The real pathway to closing the remaining wage gap lies not with increased litigation and government intervention, but with increasing opportunities for women to gain lucrative skills and choose high-earning occupations,” said Sen. Mike Enzi, R-Wyoming and the ranking Republican on the Senate labor committee.

 

It’s not clear if or when the bill will make it to the Senate floor, where the legislative calendar already is packed.

 

Sen. Tom Harkin, D-Iowa and chair of the Senate labor panel, said his goal is “sending [the bill] to the president, hopefully this Congress.”

 

Advocates hope that if Senate business on other issues stalls, Majority Leader Harry Reid, D-Nevada, can quickly bring up the paycheck legislation.

 

“It’s a bill that has strong [Democratic] caucus support; it’s something that has already passed the House,” said Lisa Maatz, director of public policy and government relations for the American Association of University Women.

 

Although Democrats lost their filibuster-proof supermajority when Sen. Scott Brown, R-Massachusetts, won a special election in January to replace the late Sen. Edward Kennedy, they still have 59 votes in the Senate. They need 60 to squelch a filibuster.

 

Dodd said that the paycheck bill could gain wide support.

 

“This is becoming a gender-neutral issue,” he said in an interview after the hearing. “It may do better than people would assume.”

 

Business groups will fight back. Michael Eastman, executive director of labor law policy at the U.S. Chamber of Commerce, said that the arguments against the paycheck bill are tougher to frame than those against the Employee Free Choice Act, which would make it easier for workers to unionize.

 

Nonetheless, Eastman warns that the pay bill would stifle businesses.

 

“The government will now be able to question so many more routine compensation decisions,” Eastman said. “The sound bite is not as easy as it is for card check. We have a lot of work to do.”

 

In her testimony at the hearing, Rep. Rosa DeLauro, D-Connecticut and author of the House version of the bill, said that companies have adjusted to race-based discrimination laws and will be able to do the same for sex-based discrimination.

 

“This legislation is a common-sense solution to the lingering problem of pay inequity,” DeLauro said. “I believe we have a moral obligation to ensure that one half of the American workforce is treated as fairly and equitably as the other half.”

 

A lawyer who represents corporations, however, said the bill sets up vague standards for defense against pay suits. It would force management to prove that compensation discrepancies are job-related and based on business necessity.

 

Jane McFetridge, a partner at Jackson Lewis in Chicago, foresees “our courts serving as super human resources departments. It will take years of expensive litigation to understand and define [the legislation’s] terms.”

 

Maatz dismisses such worries, maintaining that the paycheck bill would only put gender discrimination on par with federal race and age discrimination laws that companies have been addressing for decades.

 

—Mark Schoeff Jr.

 

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