labor lawAdivision of labor law center

Companies will have to add yet another step in their due diligence when buying or merging with a new company, because of the Ledbetter Fair Pay Act. That law permits employees to sue for wage discrimination, even many years after the fact.

Twenty years after going to work for Goodyear Tire and Rubber Company, a woman by the name of Lilly Ledbetter learned through an anonymous tipster that she was making less money for doing the same job as her male coworkers.

Lilly Ledbetter calculated that she had lost $200,000 in pay compared to the men, not to mention the lost Social Security benefits and pension funds. Ledbetter sued over the issue, but was blocked by rulings that she had not met the 180-day deadline for filing her petition. She took the matter to the Supreme Court, which upheld lower court rulings in a split decision.

Now, as a way of rectifying situations like hers, the U.S. Senate has passed, and President Obama  has signed into law, the Lilly Ledbetter Fair Pay Act of 2009. The new Act allows for discrimination suits beyond the old 180-day deadline. The Senate vote was 61 in favor and 36 against.

This means that employers must retain records on the basis of compensation decisions far longer, to defend against a possible lawsuit.

When a company is bought out by another, the new owners also purchase any liability for discrimination or other unfair labor practices. Prospective owners need to assess the risk of the company’s employee compensation packages and compensation system, before making a final purchase decision. 

The President, in signing it one week later, said Ledbetter had not planned to become a household name when she took on Goodyear. “She was just a good hard worker who did her job – and she did it well – for nearly two decades before discovering that for years, she was paid less than her male colleagues for doing the very same work,” President Obama said.

He added that he intended (more…)

On January 29, 2009, President Obama signed the Lilly Ledbetter Fair Pay Act of 2009. The fact that this act was Obama’s first bill signed into law, may signal a busy year ahead for labor legislation.

In a statement before the signing, President Obama said, “Lilly Ledbetter did not set out to be a trailblazer or a household name. She was just a good hard worker who did her job — and she did it well — for nearly two decades before discovering that for years, she was paid less than her male colleagues for doing 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 that she still feels today.”

Lilly Ledbetter worked at Goodyear Tire and Rubber Company for two decades before learning that she had consistently been paid less than her male colleagues for the identical job. She filed suit (more…)