'Other Practice' Makes Perfect Or What Lilly Ledbetter Taught Me

Imagine that you have just acquired a company that comes complete with equipment, employees and a profitable operation. Sweet. The inherited paperwork is spotty, but many of the employees are long-timers who have filled you in on the goings on. Things are running smoothly, a virtual turnkey operation. You have implemented written policies, treat your employees fairly, and direct managers to compensate employees on legitimate, non-discriminatory bases, such as prior salary, title, seniority, grade level, and performance evaluations. A few employees have grumbled about their jobs or their pay, but eventually the grumbling has stopped. Better still, the statutes of limitation have run on those who left the company. So you no longer bear the risk of being sued and having to mount defenses based on facts no one remembers and for which you no longer have witnesses or documents to aid in your defense. Right?

Not necessarily. Imagine being sued by a former employee who is complaining about actions that occurred 19 years ago.

Now imagine being held liable.

Employment acts that predate current management's tenure or recollection can come back to haunt. Take the case of Lilly Ledbetter. By now we're all somewhat familiar with her story. Nearing retirement after 19+ years at Goodyear Tires as a shift supervisor, Ms. Ledbetter sued the company for sex discrimination after receiving an anonymous tip that she had been paid 25% to 40% less than all of her 15 male counterparts. The jury in the district court found in her favor and awarded Ms. Ledbetter $223,776 in back pay and over $3 million in punitive damages. Id. at 644 (quoting from the record below). The award went up on appeal, and the Eleventh Circuit reversed it. (See Goodyear v. Ledbetter, 421 F. 3d 1169 (11th Cir. 2005).) On May 27, 2007, the Supreme Court denied Ms. Ledbetter's claim as untimely because she had not filed suit within 180 days of receiving her first discriminatory paycheck almost 20 years before. Ledbetter v. Goodyear Tire & Rubber, Co., 550 U.S. 618, 633-643 (2007); see also 42 U.S.C. § 2000e-5(e)(1) (an employee must file a discrimination charge within 180 days, or 300 days in deferral states, from the date the claim arises).

The Ledbetter Court reasoned that Goodyear's decision to pay Ms. Ledbetter less than her male counterparts was a "discrete" discriminatory act that occurred when she was hired. As with employees subjected to other acts typically held to be discrete – such as termination, failure to promote, denial of transfer, refusal to hire, and wrongful suspension, to name only a few – Ms. Ledbetter was presumed to know when the discriminatory act had occurred. Ledbetter v. Goodyear, 550 U.S. at 621. Citing the unfairness of penalizing employees for not readily detecting disparities that "are often hidden from sight," Justice Ruth Bader Ginsburg concluded her impassioned dissent by suggesting that Congress "act to correct this Court's parsimonious reading of Title VII." Id. at 645, 649 (Ginsburg, J., dissenting). Congress passed the Lilly Ledbetter Fair Pay Act ("Ledbetter Act"), which President Obama signed into law on January 29, 2009 and made retroactive to May 28, 2007.

What the Ledbetter Act Says

The Ledbetter Act amended Title VII of the Civil Rights Act of 1964 ("Title VII"), the Age Discrimination in Employment Act of 1967...