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Legal Matters Fed employee frustrations and the Fair Pay Act

The presidential election is long behind us, but there is still is an issue remaining from it that continues to frustrate federal employees. During the second debate between President Obama and Gov. Mitt Romney, the topic of the Lilly Ledbetter Fair Pay Act of 2009 came up. Subsequently, this law, which Obama signed on Jan. 29, 2009, came under heavy criticism, and there remains a need to set the record straight.

By Mathew B. Tully, Esq.

The presidential election is long behind us, but there is still is an issue remaining from it that continues to frustrate federal employees. During the second debate between President Obama and Gov. Mitt Romney, the topic of the Lilly Ledbetter Fair Pay Act of 2009 came up. Subsequently, this law, which Obama signed on Jan. 29, 2009, came under heavy criticism, and there remains a need to set the record straight.

The congressional intent of the Ledbetter legislation was not to fill the pockets of trial lawyers, but to close a loophole in federal discrimination law highlighted in the U.S. Supreme Court case of Ledbetter v. Goodyear Tire and Rubber Co. (2007). This case involved a salaried Goodyear female employee who in 1998 filed a formal Equal Employment Opportunity Commission charge alleging discrimination on the basis of her sex in violation of Title VII of the Civil Rights Act. She claimed she received inaccurate poor performance evaluations resulting in her receiving less pay than similarly situated male employees.

Initially, an Alabama jury in federal district court ruled in favor of Ms. Ledbetter, awarding her back pay and damages, but an appellate court reversed that decision finding that her claim was untimely. Likewise, the U.S. Supreme Court affirmed the lower court’s decision, finding that her claim was untimely because she filed outside of the 180-day deadline for filing an EEOC charge of when the alleged unlawful employment practice actually occurred. However, Ms. Ledbetter asserted the court’s position was incorrect and unfair in that she could not file until she had knowledge of the discriminatory practice. She further contended that her discrimination charge was timely based on a “paycheck accrual rule,” under which a new EEOC charging period starts each time an employer issued a paycheck resulting in her receiving less pay than similarly situated male employees due to the discrimination of her employer issuing the inaccurate performance appraisals. Hence, as long as the paycheck’s amount was affected by the discriminatory conduct, then a charge is timely within 180 days of issuing the paycheck.

The U.S. Supreme Court rejected this argument, but the Lilly Ledbetter Fair Pay Act of 2009 overturned the court’s decision in Ledbetter and adopted a version of the paycheck accrual rule. The law states that an unlawful employment practice relating to a discriminatory compensation decision or other action occurs “when an individual is affected by application of a discriminatory compensation decision or other practice, including each time wages, benefits, or other compensation is paid, resulting in whole or in part from such a decision or other practice.” The law covers discrimination claims dating back to May 28, 2007.

Since 2009, the act has had many positive effects on federal employees who have filed discrimination complaints over pay issues. The following are two examples of EEOC decisions in which the Lilly Ledbetter Fair Pay Act played an influential role:

• Rosado-Agosto v. Dep’t of Veterans Affairs (2010): Involved a federal employee who alleged disability and age discrimination when the agency changed her status to a lower grade position resulting in her receiving less pay. The agency dismissed the complaint as untimely, but the EEOC ruled to the contrary, saying the “Complainant was therefore affected by the agency's action each time she received a paycheck below the salary Complainant maintained she was entitled to receive.” The EEOC reversed the agency’s decision and remanded her case to the agency.

• Tesfazion v. Dep't of State (2012): Involved a State Department POL/ECON specialist who alleged discrimination on the basis of race, national origin, and color due to the agency paying her at a rate three to four times lower than what her predecessor received. Here, she began her additional duties as a Special Self-Help Fund/Democracy and Human Rights Fund coordinator position in January 2008, and did not initiate EEO contact until six months later. The agency dismissed the complaint, saying the employee’s EEO contact was untimely since she did not file a complaint within 45 days of the alleged discriminatory action. Yet, the EEOC vacated this decision and remanded the complaint “for consideration of the implications of that [Lilly Ledbetter Fair Pay] Act on this case” (i.e., the paycheck rule).

Federal employees who believe their agencies are shortchanging them in terms of pay should immediately consult with a federal employment attorney.


Mathew B. Tully is the founding partner of Tully Rinckey PLLC. He concentrates his practice on representing military personnel and federal employees and can be reached at mtully@fedattorney.com. To schedule a meeting with one of the firm’s federal employment law attorneys call 202-787-1900. The information in this column is not intended as legal advice.

 

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