Wednesday, May 30, 2007

U.S. Supreme Court Addresses Time Limit For Pay Discrimination Claims

In a 5-4 decision, the U.S. Supreme Court held that employees claiming they received disparate treatment in pay based on unlawful discrimination must do so within 180 days of the original discriminatory action rather than accrue them over the course of several years. The case is Ledbetter v. Goodyear Tire & Rubber Co. (No. 05-1074).

In Ledbetter, the plaintiff was hired in 1979 and alleged that, during the period of her employment, she was paid significantly less than her male counterparts who worked as managers at a Goodyear Tire plant in Alabama. The plaintiff retired from the company in November, 1998. A jury had awarded the plaintiff back pay and punitive damages; however, the 11th Circuit Court of Appeals reversed on the grounds that the plaintiff’s pay discrimination claim was time-barred inasmuch as it was asserted more than 180 days prior to the date she had made an administrative filing with the Equal Employment Opportunity Commission. The Supreme Court affirmed the 11th Circuit’s decision and held that, in disparate-treatment pay cases, the time-limitation for asserting a claim of discrimination begins to run from the date the discriminatory act occurs (i.e., the date of each alleged discriminatory pay decision), not from a later date. In this case, the limitations period was 180 days under Federal law since Alabama does not have a local administrative agency to process claims of discrimination. In States which do have such a local agency, such as New York, the time period for filing the administrative complaint is 300 days from the date of the discriminatory act.

The ruling makes it much more difficult for plaintiffs to win employment discrimination suits, and makes it easier for employers to defend against workplace discrimination claims that are based on long-ago decisions about salary and raises. In a rare instance of judicial posturing, Justice Ginsburg’s dissent urged Congress to overrule the majority opinion.

This is a tough one for employees. If they sue too early, there may be insufficient evidence to prove their case. If they wait until sufficient evidence exists, they may be time-barred by the limitations period. It's quite the conundrum for which there's no easy answer. Stay tuned.

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