Recent changes in employment law under the Obama administration have given employees more ammunition to file suit against their employers. Couple that with huge increases in resources allocated to the Equal Employment Opportunity Commission for enforcement of these laws, and employers should be taking more precautions than ever to keep themselves on the right side of the law, says Erica Mason of Baker, Donelson, Bearman, Caldwell & Berkowitz, PC.
“The EEOC is chomping at the bit to find new cases in the legal unit,” says Mason. “So even if you’re doing everything right, you’d better have airtight documentation to justify your actions, because if someone files a complaint, unlike in years past, the new EEOC is aggressively pursuing nearly every charge.”
Smart Business spoke with Mason about what employers need to know about recent changes to employment law and how to protect yourself should you be the target of one of the more than 90,000 complaints investigated by the EEOC each year.
What changes to the law should employers be aware of?
The Lilly Ledbetter Fair Pay Act of 2009 was the first piece of legislation President Barack Obama signed. As a result of this act, employers need to be much more careful about justifying payroll decisions across genders.
For example, an employer who has two open positions may hire an equally qualified male and female applicant for each position. However, there may be unintentional pay discrepancy because of the respective bargaining savvy of the new hires. In an all-too-common scenario, the male applicant asks for, and receives, a $50,000 annual salary. The female asks for an annual salary of $35,000, either because she is a less aggressive negotiator or she may just need the job more. Later down the road when the female finds out she’s making less, she could file suit under the Fair Pay Act. In such cases, it’s up to the employer to prove through documentation that the pay disparity was the employee’s own doing. Further, when managers are making salary decisions, they want these decisions to be based on objective criteria whenever possible, and they want oversight over the process to avoid mistakes made by rogue managers.
The bottom line is that if you pay someone less for a similar position, you’d better have your documentation readily available so that you can show that the lesser paid employee either asked for less compensation, performed at a lower level, made fewer sales, or had less work experience or education.
