In a 5-to-4 end-of-term decision authored by Justice Alito, the U.S. Supreme Court ruled in Ledbetter v. Goodyear Tire & Rubber Co. that discriminatory pay claims brought under Title VII are time-barred unless a charge is filed with the Equal Employment Opportunity Commission (EEOC) within 180 days after the alleged unlawful employment practice occurred.  "We apply the statute as written, and this means that any unlawful employment practice, including those involving compensation, must be presented . . . within the period prescribed by the statute,"  Justice Alito wrote.  The majority held that the period began to run when a pay decision was made and communicated to the employee.

A jury had originally awarded Ledbetter, a supervisor at a Goodyear tire plant, more than $3.5 million because it found it "more likely than not" that over her 19-year career Ledbetter had been paid substantially less than her male counterparts because of her sex.  The U.S. Court of Appeals for the Eleventh Circuit reversed, holding that Title VII requires a charge of discrimination to be filed within 180 days "after the alleged unlawful employment practice occurred," and Ledbetter could not prove discrimination within that time period.  It was undisputed that Ledbetter had not asserted that intentional discrimination occurred within the 180-day charging period.  Rather, she argued, discriminatory evaluations she had received throughout her career resulted in her receiving smaller raises than male counterparts, leading to a new pay discrimination violation each time she was paid less than her peers.  

Noting that Ledbetter could not rely on “the intent associated with other decisions made by other persons at other times,” the Supreme Court majority rejected her analysis.  Explaining that "current effects alone can't breathe life into prior, uncharged discrimination," the majority dismissed “the suggestion that an employment practice committed with no improper purpose and no discriminatory intent is rendered unlawful nonetheless because it gives some effect to an intentional discriminatory act that occurred outside the charging period.”

In a stinging dissent read from the bench, Justice Ginsburg accused her colleagues in the majority of not comprehending, or being indifferent to, the “insidious way in which women can be victims of pay discrimination.”  Commenting that the secrecy in most workplaces about salaries prevents many employees from knowing that they received a lower raise until long after the 180-day filing deadline has passed, she expressed the view that pay disparities, as the result of “the cumulative effect of individual acts,” are more akin to hostile environment claims than to discrete acts of discrimination that constitute separate and temporally distinct employment practices.  But the majority eschewed this view as well, preferring a hard-and-fast rule that pay-setting decisions are “discrete acts” of discrimination -- comparable to termination, failure to promote, and denial of transfer decisions – and the period for filing an EEOC charge accordingly begins when the act occurs.

Proposed legislation that would undo the Ledbetter decision was quickly introduced into Congress.  On July 31, the House passed the “Lilly Ledbetter Fair Pay Act of 2007,” which would amend Title VII and several other federal statutes to provide that an unlawful employment practice occurs each time an employee receives pay resulting from a discriminatory compensation decision.  A counterpart Senate bill is awaiting committee action, and the outlook for Senate passage is cloudy.  President Bush has threatened to veto the legislation if it passes.

Elizabeth Hardy