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As a Texas Employer, How Does the Lilly Ledbetter Act Affect Me?

Posted by Chris Peterson | Apr 15, 2014

Political candidates in Texas are still wrangling over whether Texas will pass an equal-pay-for-women act similar to the federal law enacted in 2009. Proponents of the bill say it is necessary to help reduce gender discrimination in the workplace, while opponents argue the bill will open the floodgates for frivolous lawsuits against Texas employers in state courts. In this article, we'll look past the politics and explain the defining element of this law — the statute of limitations.

What is the Lilly Ledbetter Act?

The Lilly Ledbetter Act is named for the Alabama woman who sued Goodyear over gender discrimination, claiming she earned less that her male counterparts who performed the same job she did. Ms. Ledbetter ultimately lost her case in the U.S. Supreme Court in 2007 because the high court ruled the statute of limitations expired before she filed her lawsuit. At that time, a person had to file a lawsuit within 180 days of receiving the first unequal paycheck.

Congress responded in 2009 with passage of the federal Lilly Ledbetter Act, which essentially gives employees 180 days after receiving the last unequal paycheck to file a lawsuit. A number of states followed suit and enacted similar versions of the federal law, effectively giving people a longer time within which to file discrimination cases in state courts.

Why are other states passing similar laws if a federal law already exists?

The answer to this question is something we, as lawyers, consider on a regular basis: choice of forum.  If a lawsuit can be maintained in more than one arena — for example, state or federal court, or multiple states — experienced attorneys consider which forum is most likely to serve their clients' best interests.

In states which have a version of the Lilly Ledbetter law on the books, an unhappy employee probably has more than one choice of forum. In states where there is no Lilly Ledbetter law extending the statute of limitations for filing a lawsuit, an employee may only have the federal system as an option. Generally speaking, federal lawsuits tend to be more costly, cumbersome and time-consuming than those in state courts.

Should I be for or against Texas passing a Lilly Ledbetter law?

This is where you get to make up your own mind. If, as an employer, you are careful to avoid discriminatory practices in your business, then you may not care either way because you believe you will never have to defend against a discriminatory pay lawsuit. On the other hand, if your business and its employees have been around for quite some time, or you acquired a business and kept its employees at existing pay levels, you might want to investigate whether the wages you pay are fair among men and women for the jobs they do.

Either way, workers in Texas already have the option of filing a federal gender discrimination claim against their employers within 180 days of receiving the last unfair paycheck. Passage of a Texas version of the Lilly Ledbetter Act might simply expand their options as to where they could file a claim.

The best course of action, of course, is to avoid discriminatory practices in the workplace. It's better to spend your time thinking of ways to grow your business in the future than worrying about whether you will have to defend your business's past.

For legal advice about starting or managing your business, including employment and compliance issues, contact an experienced Bryan-College Station, Texas business law attorney. Call Peterson Law Group today for a consultation at 979-703-7014 or fill out our online contact form to request a meeting.

About the Author

Chris Peterson

Chris Peterson is the owner of Peterson Law Group. He practices primarily in the areas of wills, trusts and estate planning; probate and trust administration; elder law; and business law. Chris is also the owner of Brazos 1031 Exchange Company.

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