On March 11, the Senate Committee on Health Education Labor and Pensions (”HELP”) convened a hearing on the problem of gender pay inequity entitled, “A Fair Share for All: Pay Equity in the New American Workplace.”In his opening remarks, Senator Tom Harkin (D-Iowa), Chairman of the Committee, noted that despite passage of the Equal Pay Act in 1963 women today make only 77 cents for every dollar a man makes. Sen. Harkin characterized pay inequity as “not just a women’s issue, but a family issue” and expressed strong support for the Paycheck Fairness Act introduced by Senators Christopher Dodd (D-Connecticut) and Barbara Mikulski (D-Maryland), which was passed overwhelming by the House in January. Harkin said the legislation would provide the same pay for equivalent jobs, require employers to disclose pay scales and job descriptions, and give women more information to enable to negotiate better deals for themselves.

Ranking Member Michael Enzi (R-Wyoming) expressed his concern that the Paycheck Fairness Act would subject employers to more litigation, particular large class actions. He also criticized the bill for adding more “burdensome government reporting requirements,” and argued that improved job training nationwide and an improved economy would resolve many pay inequity issues. Sen. Dodd rejected criticism about the possibility for increased litigation and argued that the legislation would simply ensure women get the pay that they deserve.

The first witness at the hearing was the Honorable Rosa DeLauro, U.S. Representative for Connecticut’s 3rd District. She stated that the Paycheck Fairness Act would “close numerous longstanding loopholes in the Equal Pay Act” and stiffen “penalties for employers who discriminate based on gender.” Rep. DeLauro noted that the legislation would strengthen remedies to include punitive and compensatory damages, remedies already afforded to victims of race-based discrimination under the law. In response to the prediction that the legislation would result of in torrent of class actions lawsuits, Rep. Delauro argued that employers would successfully adjust to the new legislation and avoid any increased litigation effect, just as employers did in response to the passage of race-based discrimination laws.

The next witness was Stuart Ishimaru, Acting Chairman of the Equal Employment Opportunity Commission (”EEOC”). In addition to reiterating many of the facts showing that the gender wage gap persists, Ishimaru noted that caregiver discrimination is a part of the problem. Ishimaru explained that women are more than twice as likely to work part time, often because they need to provide care for kids and other family members, and that part time work pays less and is less likely to come with benefits. Ishimaru stated, “gender-based wage discrimination is especially untenable now, in this economy, as most families have come to rely on the incomes brought in by working women to make ends meet.” Ishimaru continued that EEOC’s “work would undoubtedly be strengthened by the passage of the Paycheck Fairness Act” and that the legislation would “provide essential tools” such as improved wage data “towards realizing the promise of equal pay.”

Heather Boushey, Senior Economist at the Center for American Progress, also testified before the panel stressing that women lose an average of $434,000 over a lifetime due to the gender wage gap. Boushey stated that the “largest chunk of the gender pay gap is due to combined effect of the segregation of men and women into different industries and occupations.” Boushey argued that the “data provisions of the Paycheck Fairness Act will allow employees to access the information they need to understand if their pay is at the market rate.”

The remaining witnesses were Deborah L. Brake, Professor of Law at the University of Pittsburgh, Deborah L. Frett , Chief Executive Officer of the Business and Professional Women’s Foundation, and Jane McFetridge, a partner at Jackson Lewis, LLP.

Core Provisions: The Corporate Executive Accountability Act (S. 3049)comprises part of the Democrats’ comprehensive financial regulatory reform package, building on separate legislation previously passed in the House (H.R. 3269). The Act aims to reform executive pay practices by granting shareholders a non-binding vote on executive pay packages and requiring companies to disclose the ratio of CEO pay to median company worker pay in their annual reports. Additionally, the Act would hold executives accountable for failure or fraud by giving regulators and investors the authority to seize bonuses from executives who have engaged in misconduct, and by prohibiting “golden parachute” arrangements for executive who are fired for cause. The Act would also prohibit the executives of publicly listed companies from cashing out all of their vested equity compensation at once in order to encourage long-term corporate viability over short-term profitability practices that encourage excessive risk taking. The Act is sponsored by Sen. Robert Menendez (D-NJ).

Bill Status: The Bill was introduced in the Senate on February 26, 2010 and referred to the Senate Committee on Banking, Housing and Urban Affairs.

On February 24, 2010, the Senate easily approved a $15 billion jobs bill. The measure passed by a 70-28 vote. Thirteen Republican senators joined 55 Democrats and two Independents to approve the bill. One Democrat, Sen. Ben Nelson, voted against the bill, along with 27 Republicans.

The bill (H.R. 2847) is intended to create jobs, help small businesses grow, and rebuild public infrastructure. According to Sen. Majority Leader Harry Reid (D-NV), the bill is the first part of a multipart “jobs agenda.”

The bill includes a new program that would give companies a break from paying Social Security taxes on new employees for the remainder of 2010. It also includes a one-year extension of the Highway Trust Fund, an expansion of the Build America Bonds program ,and a provision to allow companies to write off equipment purchases.

Core Provisions: This resolution calls for the mandatory use of the E-Verify program by employers of workers within the United States as well as enforcement policies that hold both employers and employees responsible for violations of United States immigration law. The resolution also states that it is a “critical responsibility” of the Federal Government to install and sustain border infrastructure and manpower to control the United States borders and protect from unauthorized passage of persons or contraband. Additionally, the resolution states that no immigration reform adopted by Congress should legalize, condone, or grant amnesty for the otherwise unlawful entry or presence of individuals in the United States.

Status: Rep. Jason Chaffetz (R-UT) and twenty-one co-sponsors introduced the resolution on January 21, 2010. It was referred to the House Committee on the Judiciary and the Committees on Education and Labor, and Homeland Security on the same day.

On December 19, 2009, President Obama signed the FY 2010 Defense Appropriations Bill (H.R. 3326) into law. The bill, which passed the Senate 88-10 on December 19, 2009, was nearly held up by a strategic Republican filibuster the previous day, achieving cloture by only four votes (63-33). The filibuster was aimed at stalling the progress of Democratic-sponsored health reform legislation concurrently under consideration in the Senate. The House of Representatives had previously approved the FY 2010 Defense Appropriations Bill on September 16 by a 395-34 vote.

The bill includes provisions to extend unemployment and COBRA benefits and also prohibits Defense Department contractors and subcontractors from requiring their employees and independent contractors to agree to arbitrate certain claims. Those provisions are discussed in greater detail in the Washington Labor & Employment Wire’s previous post on the House’s passing of this legislation.

The FY 2010 Defense Appropriations Bill is Public Law No: 111-118.

Core Provisions: This legislation would amend the Internal Revenue Code to modify the rules concerning the treatment of independent contractors to make it more difficult and costly for businesses to incorrectly classify employees as independent contractors.

In addition to significantly increasing the amount of penalties associated with filing tax returns with incorrect information concerning individuals’ employment status, the bill would change the “safe harbor” provisions of section 530 of the Revenue Act of 1978, which allows employers to designate employers as independent contractors for employment tax purposes, regardless of the workers status as an independent contract under common law test, unless the employer has no “reasonable basis” for such treatment. The amended safe harbor provision would only considered a business to have such a reasonable basis for classifying a worker as an independent contractor if it, or its predecessor, has not treated any other individual holding a substantially similar position as an employee since December 31, 1977, and the business’s treatment of the worker as an independent contractor is in reasonable reliance on: (1) “a written determination … addressing the employment status of the individual or an individual holding a substantially similar position” with the business; or (2) ” a concluded examination (for employment tax purposes) of whether the individual (or an individual holding a substantially similar position) should be treated as an employee ….”

If passed into law, the bill would also grant individuals classified as independent contractors the right to petition the Secretary of the Treasury for a determination of their status for employment tax purposes.

Status: Senator J. Kerry (D-MA) introduced the legislation on December 15, 2009, and it was referred to the Senate Committee on Finance.

On Wednesday, December 16, President Obama signed into law the Fiscal Year 2010 Consolidated Appropriations Bill (H.R. 3288).  This omnibus appropriations legislation provides additional funding to the Department of Labor, the National Labor Relations Board, and the Equal Employment Opportunities Commission, among other federal agencies.  The bill passed in the Senate by a 57-35 vote earlier this week, and previously passed the House by a vote of 221-202. 

On December 16, 2009, the House approved the FY 2010 Defense Appropriations Bill by a 395-34 vote. This most-recently approved version of the Defense Appropriations Bill includes provisions to extend unemployment and COBRA benefits and also prohibits Defense Department contractors and subcontractors from requiring their employees and independent contractors to agree to arbitrate certain claims. 

If signed into law, the bill would extend from nine to fifteen months the 65-percent COBRA health insurance subsidy for individuals who have lost their jobs. While the previous extension of COBRA benefits passed by Congress earlier this year applied to individuals who were involuntarily terminated between April 1, 2008 and December 31, 2009, this bill would extend the job loss eligibility date to February 28, 2010. In addition, the bill would extend previously expanded unemployment benefits, including increased payouts and longer duration of benefits, through February 28, 2010.

The Defense Appropriations Bill would also prohibit defense contractors or subcontractors from entering into or enforcing any agreement with their employees or independent contractors that would require them to arbitrate claims under Title VII of the Civil Rights Act of 1964 or any tort related to or arising out of sexual assault or harassment, including assault and battery, intentional infliction of emotional distress, false imprisonment, or negligent hiring, supervision, or retention. This provision would apply to contracts over $1 million that are awarded more than sixty days after the effective date of the Act. The bill would, however, allow the Secretary of Defense to waive this prohibition if necessary to avoid harm to the national security interests of the United States.

The bill now moves to the Senate for consideration. The Senate previously passed a different version of this appropriations bill in October.

On Sunday, December 13, 2009, the Senate approved the $446.8 billion fiscal year 2010 consolidated appropriations bill (H.R. 3288), on a 57-35 vote. The omnibus bill consolidates six of the seven remaining fiscal year 2010 appropriations bills: the Commerce, Justice, Science, and Related Agencies Appropriations Act (H.R. 2847); the Departments of Labor, Health and Human Services, Education and Related Agencies Appropriations Act (H.R. 3293); the Financial Services and General Government Appropriations Act (H.R. 3170); the Military Construction and Veterans Affairs Appropriations Act (H.R. 3082); the Department of State, Foreign Operations, and Related Programs Appropriations Act (H.R. 3081); and the Transportation, Housing and Urban Development and Related Agencies Appropriations Act (H.R. 3288). 

Under this omnibus appropriations bill, the Department of Labor, the National Labor Relations Board, and the Equal Employment Opportunity Commission will all receive increased funding in FY 2010. The Department of Labor’s budget will increase $431 million from FY 2009, the National Labor Relations Board’s budget will increase $20.8 million from FY 2009, and the Equal Employment Opportunity Commission’s budget will increase $23 million from FY 2009. In total, under the bill the Department of Labor will receive $13.3 billion in discretionary funding, the National Labor Relations Board will received $283.4 million, and the Equal Employment Opportunity Commission will receive $367.3 million.  

If signed into law, the bill will also provide funding for the Justice Department’s Civil Rights Division ($145 million), the Federal Mediation and Conciliation Service ($46.7 million), the National Mediation Board ($13.5 million), the Occupational safety and Health Review Commission ($11.7 million), the Federal Mine Safety and Health Review Commission ($10.4 million), the U.S. Commission on Civil Rights ($9.4 million), and the National Council on Disability ($3.3 million).

As noted in the Senate Appropriations Committee summary, the bill would also present additional targeted funding for unemployment insurance program operations ($3.2 billion), dislocated worker employment and training ($1.4 billion), the Department of Labor’s “worker protection” agencies that regulate pensions, mine safety and health, occupational safety and health, wage and hour rules, and federal contractor compliance ($1.6 billion), and military veteran’s employment and training ($256 million).

The House previously approved the omnibus bill on December 10, 2009, on a 221-202 vote. The legislation now moves to the White House to be signed by the President. President Obama is expected to sign the bill.

On December 1, the Senate Judiciary Committee held a hearing to consider legislation that would reverse two recent Supreme Court rulings that heightened the civil pleading standard. The hearing, called “Has The Supreme Court Limited Americans’ Access To Courts?”, was held to discuss the Notice Pleading Restoration Act of 2009 (S. 1504), introduced July 22 by Sen. Arlen Specter (D-Pa) and co-sponsor Russ Feingold (D-WI).  

The legislation would reverse Bell Atlantic Corporation v. Twombly, issued in 2007, and Ashcroft v. Iqbal, issued in May.  In Twombly, an antitrust case, the Court held that a complaint must contain facts that plausibly entitle the plaintiff to relief instead of mere conclusory statements. The Iqbal decision extended this standard to all civil complaints. The Act would restore the more lenient notice prior pleading standard articulated in Conley v. Gibson, which held that a court could dismiss a complaint only if it appeared without a doubt that a plaintiff would be able to prove no set of facts in support of her claim.

In his opening statement, Senator Patrick Leahy (D-Vt), Chairman of the Judiciary Committee, testified that the two decisions are “just the latest example of conservative judicial activism” and that legislation was necessary to ensure that Americans could access the court system. Leahy stated that the new precedent “will result in prematurely closing the courthouse doors on ordinary Americans seeking the meaningful day in court that our justice system has provided” and noted that “wealthy corporate defendants” “would prefer never to be sued and never to be held accountable.”

The committee heard testimony from Stephen Burbank, a professor at the University of Pennsylvania Law School, who expressed his concerns that the Court’s recent decisions “may contribute to the phenomenon of vanishing trials, the degradation of the Seventh Amendment right to jury trial, and the emasculation of private civil litigation as a means of enforcing public law.” He testified that “the primary purpose of any legislation responding to the Court’s decisions should be to restore the status quo” “until careful study, enabled by a process that is open, inclusive, and thorough, supports the need for change.” 

John Payton, President of the NAACP Legal Defense and Educational Fund, testified that the heightened pleading standards create “a real danger” that “meritorious civil rights cases will be dismissed.” Payton urged Congress to “act immediately” to protect victims of discrimination.

On the other hand, former Solicitor General Gregory Garre defended the Court’s decisions and testified that Twombly and Iqbal were “correctly decided” and “firmly grounded in decades of prior precedent.” Garre warned that permitting cases with “implausible” claims to go forward would result in “enormous costs.”