In Massachusetts and across the country, pay discrimination between men and women is prevalent. According to the Institute for Women’s Policy Research, female workers earn 79% of the compensation paid to men. Moreover, data analyzed by The Wall Street Journal reveals that unequal pay between genders can be even more dramatic in higher paying, white collar professions. Overall, the Journal’s interactive model highlights that virtually no profession is immune from gender pay disparity. Female judges, for example, earn just 67% of the pay of their male counterparts. Female lawyers do not fare much better coming in at 79%. And female physicians face one of the largest disparities with compensation averaging just 64 cents of every dollar earned by a male colleague.
Several statutes, both in Massachusetts and on the federal level, can be utilized to remedy pay discrimination. From the Massachusetts and federal Equal Pay Acts to Title VII and the Fair Employment Practices Act, each law varies in many ways, including the types of recovery that a successful plaintiff may be awarded and the deadline by which claims must be filed. The following is a general overview of the statutes most commonly relied upon in filing pay discrimination lawsuits:
One of the most well-known and controversial unequal pay cases can be found in Ledbetter v. Goodyear, which was brought as a gender discrimination claim under Title VII. During her nineteen years with Goodyear, Lilly Ledbetter received a series of discriminatory annual performance and salary reviews, which ultimately resulted in a significant pay disparity between her and her male counterparts. A jury awarded Ledbetter more than $3.5 million, which the judge later reduced by nearly 90% pursuant to the statutory damages caps under The Civil Rights Act of 1991. Goodyear appealed, and the case made its way to the United States Supreme Court.
In what the dissent viewed as “a cramped interpretation of Title VII,” the Supreme Court overturned the jury’s verdict, reasoning that Ledbetter’s gender discrimination claim under Title VII was untimely because she did not file her case with the Equal Employment Opportunity Commission (EEOC) within 180 days after the last discriminatory act. In an effort to neutralize this decision and its precedential value, Congress passed the Lilly Ledbetter Fair Pay Act in 2009 and, in doing so, noted:
The Ledbetter decision undermines those statutory protections by unduly restricting the time period in which victims of discrimination can challenge and recover for discriminatory compensation decisions or other practices, contrary to the intent of Congress.
Among other provisions, the Act makes clear that a plaintiff may introduce evidence of gender discrimination occurring beyond the filing period, and can also recover back pay for up to two years before the date of filing with the EEOC.
While far from employee-friendly, the Ledbetter decision did not foreclose the use of the “discovery rule” in unequal pay cases under Title VII. Specifically, in footnote 10, the Supreme Court observed that it had “previously declined to address whether Title VII suits are amenable to a discovery rule” in National Railroad Passenger Corporation v. Morgan, and was passing on the issue again “[b]ecause Ledbetter does not argue that such a rule would change the outcome in her case, we have no occasion to address this issue.”
Under the discovery rule, the statute of limitations clock does not begin to run until the plaintiff knew or should have known that pay discrimination existed. Massachusetts courts have long held that the discovery rule applies to unlawful discrimination claims under the Massachusetts Fair Employment Practices Act, as codified under M.G.L. c. 151B. In Wheatley v. American Telephone & Telegraph, for example, the Supreme Judicial Court (SJC) made clear that the statute of limitations clock for the plaintiff’s age discrimination claim under M.G.L. c. 151B did not commence until the plaintiff “knew or should have known that he had been or would be replaced by persons outside the protected age group.” Later, in Silvestris v. Tantasqua Regional School District, the SJC held that the discovery rule also applies to unequal pay claims brought under the Massachusetts Equal Pay Act:
Because pay claims do give rise to a cause of action each time they occur and are easily identifiable, it is not unreasonable to expect a plaintiff to file a charge of discrimination within the limitations period, so long as the plaintiff is aware of the discrimination. …. In most instances, the question when a plaintiff knew or should have known of the existence of a cause of action is one of fact that will be decided by the trier of fact.
Notably, the amended version of the Massachusetts Equal Pay Act, which will become effective on January 1, 2018, states that an equal pay violation occurs not only when a discriminatory compensation decision is made, but also when an employee becomes subject to or is affected by that decision. This language acknowledges the reality of unequal pay claims; namely, that employees may not realize until years or even decades later that a discriminatory pay scheme is in place. Significantly, had Ledbetter’s unequal pay claim been premised on such statutory language, her jury verdict would likely have been upheld.
Another significant issue in unequal pay cases is how far back an employee who has suffered pay discrimination can recover. The Fair Employment Practices Act is unequivocal that its statute of limitations period does not act as a cap on damages. In McMillan v. MSCPA, for instance, the First Circuit upheld a jury verdict under M.G.L. 151B, which included approximately $183,000 for pay discrimination over a six year period. In doing so, the First Circuit rejected the employer’s argument that M.G.L. c. 151B’s three year statute of limitations period limits back pay liability:
This argument is without merit. No court decisions impose such a cap under Massachusetts law, and defendants present no rationale as to why state law should be the same as federal law. Further, Mass. Gen. Laws ch. 151B … mandates “make-whole relief,” which encompasses damages which are “the natural and probable consequences of the illegal conduct.” Indeed, the SJC has declined to follow federal precedent in order to interpret chapter 151B more liberally than the federal courts have interpreted parallel federal law provisions. We thus decline to adopt defendants’ suggestion.
In 1945, Massachusetts enacted the first Equal Pay law in the country and, in light of its recent amendments, once again leads the way in seeking to minimize the pay gap between genders. Careful, strategic decisions must be made, however, in successfully bringing unequal pay claims. As the pay gap continues to garner attention, equal pay laws will come into sharper focus and — as the Ledbetter case illustrated — their effectiveness may ultimately hinge on judicial interpretation.
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