U.S. Supreme Court Upholds 180-Day Period for Pay Bias Claims

May 30, 2007

The U.S. Supreme Court has handed employers a victory against pay discrimination suits by limiting how far back in time employees can go to prove their bias claims.

In Ledbetter v. Goodyear Tire & Rubber Co., the high court ruled that an employee must file a complaint with the Equal Employment Opportunity Commission (EEOC) based on an alleged discriminatory event that occurred within the 180 deadline contained in the Title VII of the Civil Rights Act of 1964.

Employees cannot bring a case based on allegedly discriminatory salary or pay schemes that were in effect prior to the 180-day statutory limitations period even if they were paid during the statutory limitations period, according to the 5-4 decison written by Justice Samuel Alito.

The case arose in 1998 when Lilly Ledbetter sued her employer, Goodyear Tire and Rubber Co., for wage discrimination based on gender. She complained that after 19 years at the company’s Gadsden, Ala., plant, she was making $6,000 a year less than the lowest-paid man doing the same work.

Ledbetter alleged that several supervisors had in the past given her poor evaluations because of her gender; that as a result, her pay had not increased as much as it would have if she had been evaluated fairly; that those past pay decisions affected the amount of her pay throughout her employment; and that by the end of her employment, she was earning significantly less than her male colleagues.

In its defense, Goodyear denied discriminating against Ledbetter and argued that she received periodic raises despite being ranked near the bottom of her group of workers.

Ledbetter won a jury verdict with back pay and damages worth $360,000 at the lower court level, but the Court of Appeals for the Eleventh Circuit reversed the verdict, holding she had field her case too late because the company’s original decision on her pay had been made years earlier. The Supreme Court upheld that decision.

Ledbetter had contended that each paycheck she received triggered a new 180-day EEOC deadline. Goodyear argued that the statutory deadline would be rendered meaningless if workers could go back years in time to support a claim.

Justice Alito, writing for the majority, agreed with Goodyear: “This short deadline reflects Congress’ strong preference for the prompt resolution of employment discrimination allegations through voluntary conciliation and cooperation.”

He rejected Ledbeter’s argument thate ach paycheck triggered a new deadline. “A new violation does not occur, and a new charging period does not commence, upon the occurrence of subsequent nondiscriminatory acts that entail adverse effects resulting from the past discrimination,” Alito wrote.

Alito maintained that Ledbetter should have filed an EEOC charge within 180 days after each allegedly discriminatory employment decision was made. “Her attempt to shift forward the intent associated with prior discriminatory acts to the 1998 pay decision is unsound, for it would shift intent away from the act that consummated the discriminatory employment practice to a later act not performed with bias or discriminatory motive, imposing liability in the absence of the requisite intent,” he wrote.

Justice Ruth Bader Ginsburg and three other justices dissented.

“In our view, this court does not comprehend, or is indifferent to, the insidious way in which women can be victims of pay discrimination,” Ginsburg said.

Business groups applauded the decision.

“We commend the court for issuing a fair decision that eliminates a potential windfall against employers by employees trying to dredge up stale pay claims,” said Robin Conrad, of the National Chamber Litigation Center, a legal institute allied with the U.S. Chamber of Commerce.

Civil rights advocates were critical of the decision.

“The court’s decision is a setback for women and a setback for civil rights,” said Marcia Greenberger, of the National Women’s law Center. “The ruling essentially says tough luck to employees who don’t immediately challenge their employer’s discriminatory acts, even if the discrimination continues to the present time.”

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