Court Cites Ledbetter Law in Reversing Its Prior Decision in Equal Pay Case

An employer’s refusal to respond to an employee’s request for a pay raise can be a violation of the Lilly Ledbetter Fair Pay Act of 2009, a federal appeals court has ruled in reversing its own earlier decision.

In its original March 24 ruling in Mary Lou Mikula v. Allegheny County of Pennsylvania, the 3rd U.S. Circuit Court of Appeals in Philadelphia affirmed a lower court’s ruling that had dismissed a claim filed by Mikula under Title VII of the Civil Rights Act of 1964.

Mikula, a grants coordinator hired in 2001 by the Allegheny County Police Department, had lobbied unsuccessfully for a salary increase, arguing that a man in a comparable position was paid $7,000 more a year. When the pay raise was not granted, she sued under Title VII and the Equal Pay Act of 1963.

In January, President Barack Obama signed into law the Lilly Ledbetter Fair Pay Act of 2009, which eases time limits on age discrimination claims. The law states that an unlawful employment practice occurs when an individual becomes “subject to a discriminatory compensation decision or other practice.”

In its original ruling, the court “acknowledged the passage of the Act and explained that it did not change the result because it required the adoption of a discriminatory compensating decision rather than, as in this case, a request for a raise that was never answered,” according to the opinion.

However, in seeking a rehearing, “for the first time, Mikula defines her claim as a ‘classic paycheck accrual’ case, which, she asserts, is exactly the type of claim that the act was passed to protect. She claims that the county’s lack of response to her raise requests qualify as discriminatory pay decisions or ‘other practices.’ … Under this rationale, each paycheck that Mikula has received is discriminatory and constitutes a new violation that renews the statutes of limitation,” the court said in its revised ruling September 10.

“Despite our earlier decision, we now hold that the failure to answer a request for a raise qualifies as a compensation decision because the result is the same as if the request had been explicitly denied,” the appeals court said in the ruling that sets a precedent.

The court also reinstated its March decision upholding Mikula’s Equal Pay Act claim and remanded the case for further proceedings.

Filed by Judy Greenwald of Business Insurance, a sister publication of Workforce Management. To comment, e-mail editors@workforce.com.

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