What Is the Lilly Ledbetter
Fair Pay Act?
- The act would allow pay discrimination lawsuits to proceed
years or even decades after alleged discrimination took place.
- Under the act, employees could sue at any time after alleged
discrimination occurred, so long as they have received any
compensation affected by it in the preceding 180 days.
- Since ancient Roman times, all Western legal systems have
featured statutes of limitations for most legal claims.
- Statutes of limitations perform several important functions
that would be sacrificed by the Ledbetter Act, including:
- Furthering justice by blocking suits where defensive evidence
is likely to be stale or expired;
- Preventing bad actors from continuing to harm the plaintiff and
other potential victims;
- Preventing gaming of the system (such as destroying defensive
evidence or running up damages);
- Promoting the resolution of claims.
- The Ledbetter Act would allow cases asserting extremely tenuous
links between alleged discrimination and differences in pay, which
may result from any number of non-discriminatory factors, such as
- In addition to investigatory and legal expenses, employers will
face the risk of punitive damages and the difficulty of rebutting
assertions of discriminatory acts from years or decades ago.
- The Ledbetter Act may actually harm those it is intended to
- In making employment decisions, businesses would consider the
potential legal risks of hiring women, minorities, and others who
might later bring lawsuits against them and, as a result, hire
fewer of these individuals.
- Other employers might simply fire employees protected by Title
VII--and especially those who are vocal about their rights under
the law--to put a cap on their legal liabilities.
- The Ledbetter Act would hand a major victory to trial lawyers
seeking big damage payoffs in stale suits that cannot be
- A single legal victory against an employer could provide the
fodder for scores of lawsuits by similarly situated employees and
former employees receiving benefits, each alleging a pattern of
discrimination affecting pay, as evidenced by the previous
lawsuits. In this way, each lawsuit becomes easier and cheaper to
bring than the last.
- Employers can be expected to change their hiring, firing, and
wage practices to reduce the risk of lawsuits.
- If, as suggested by Eric Posner, businesses "start paying
workers the same amount even though their productivity differs
because they fear that judges and juries will not be able to
understand how productivity is determined," the law would impose
significant costs on businesses and, by extension, consumers and
- The result would be a hit to employment and wages, combined
with higher prices for many goods and services.
James Sherk is Bradley
Fellow in Labor Policy in the Center for Data Analysis at The