PA 09-101—HB 6185

Labor and Public Employees Committee

Judiciary Committee

AN ACT CONCERNING PENALTIES FOR VIOLATIONS OF CERTAIN PERSONNEL FILES STATUTES AND EQUAL PAY FOR EQUAL WORK

SUMMARY: This act makes several changes to the labor law banning employers from discriminating based on gender in the compensation paid to employees.

By law, the labor commissioner, an employee, or a group of employees can initiate claims in civil court regarding alleged pay discrimination for work performed under similar conditions by two or more employees that requires equal skill, effort, and responsibility. The court can award back pay in these claims. The act allows a court to award compensatory and punitive damages. In employee or employee group claims, the act allows the employee or employee group to ask the court for legal and equitable relief (in addition to the other remedies), but the commissioner does not have this option.

The act also eliminates the commissioner's ability to seek reasonable attorneys' fees and costs as was permitted under prior law. By law, and unchanged by the act, an employee or employee group can seek attorneys' fees and costs.

The act also:

1. limits bona fide defenses that employers may assert,

2. extends the deadline for making a gender wage claim from one to two years following a violation,

3. specifies that gender does not have to be the sole factor in the discrimination for gender wage discrimination to occur,

4. expands the whistleblower protections to include those who testify or assist in a gender wage proceeding, and

5. repeals the $200 fine for each wage discrimination violation or for retaliatory action against an employee bringing a gender wage complaint.

In addition to the labor law banning gender wage discrimination, the Connecticut human rights statute prohibits discrimination more broadly, not just based on gender. Federal antidiscrimination law also protects employees from gender wage discrimination as well as many other forms of discrimination. In certain ways, the act's changes to the labor law make it easier to bring a claim under that law than under state human rights laws or federal law.

This act also subjects any employer, officer, agent, or other person who violates the provisions of the Personnel Files Act to a $300 civil penalty for each violation. The Labor Department imposes the penalty and can ask the attorney general to initiate civil action to recover any unpaid penalties.

By law, when the attorney general helps recover penalties from violations of (1) Chapter 557 (employment regulation regarding minors, people with disabilities, apprentices, family and medical leave, certain employee rights, and other employment issues); (2) Chapter 558 (various wage laws); (3) and the law against workers' compensation insurance fraud, the money is credited to the Labor Department to use to enforce the laws that generated the penalties. The act authorizes personnel file penalties to be used to support enforcement of the personnel file law or any of the other laws previously mentioned.

EFFECTIVE DATE: October 1, 2009

ENFORCEMENT AND LEGAL REMEDY

By law, the labor commissioner may agree to take an employee's complaint of unfair wages or may investigate on her own initiative. The law authorizes the commissioner, or her representative, to enter workplaces to inspect payrolls, investigate employee work and operations, question employees, and take reasonably necessary action to determine compliance with the law.

By law, an employee or group of employees may initiate a court action or ask the commissioner to initiate court action. The employee or group of employees can pursue court action if the commissioner declines to do so.

Under prior law, a finding of a violation required a court to order the employer to pay back wages and costs and reasonable attorneys' fees. The act gives the court the discretion to order remedies and has a broader scope of possible remedies. Table 1 below shows the changes in possible remedies the court may award in gender wage discrimination cases.

Table 1. Possible Court Ordered Remedies

Prior Law

Act

Claim by commissioner or employee

Claim by commissioner

Claim by employee

● back wages (difference between what the employee was paid and the top pay of others doing same work)

● costs and reasonable attorneys' fees

● back wages (same meaning as prior law)

● compensatory damages

● punitive damages, if the violation is found to be intentional or committed with reckless indifference

● back wages (same meaning as prior law)

● compensatory damages

● punitive damages, if the violation is found to be intentional or committed with reckless indifference

● costs and reasonable attorneys' fees

● legal and equitable relief the court deems proper

Prior law also imposed a fine on each employer of $200 for each violation. The act repeals the fine.

COMPLAINTS AND LIMITED EMPLOYER DEFENSES

The act establishes a complaint threshold that, if met, limits an employer's legitimate defenses and when the defense can be used. If an employee can demonstrate that his or her employer discriminates based on gender in wages paid to employees at the employer's business for equal work performed under similar conditions that requires equal skill, effort, and responsibility, then the employer must show the pay differential was due to a:

1. seniority system;

2. merit system;

3. system that measures earnings by quantity or quality of production; or

4. differential system based upon a bona fide factor other than sex, such as education, training, or experience.

The act specifies that the bona fide factors are valid only if the employer shows the system is (1) not based on or derived from a sex-based differential in compensation and (2) job-related and consistent with business necessity. Furthermore, the defense is not valid if the employee shows that an alternative compensation practice exists that would serve the same business purpose without producing such a pay differential and that the employer has refused to adopt such an alternative.

Prior law only permitted length of service or a merit system as legitimate factors in wage determinations and did not limit when such systems could be used in wage determinations.

Prior law prohibited gender as the sole basis for gender wage discrimination. The act removes the requirement that gender be the sole reason. This means that if gender can be one factor, the discrimination is considered a violation.

EXTENDED TIME TO FILE A CLAIM

The act extends, from one to two years, the time to file a complaint following any violation or act that constitutes a continuing violation, such as each time wages or other benefits are paid. Complaints can be filed within three years if the violation is intentional or committed with reckless indifference.

WHEN DISCRIMINATION OCCURS

Under the act, discrimination occurs when:

1. a discriminatory compensation decision or practice is adopted,

2. an individual becomes subject to a discriminatory decision or practice, or

3. an individual is affected by the application of a discriminatory decision or practice.

Under the act, each time wages or other compensation are paid constitutes a new violation.

EXPANDED WHISTLEBLOWER PROTECTION

Under prior law, it was a violation to discriminate against an employee who filed a complaint or took other action regarding gender wage discrimination. The act specifies and expands the whistleblower protection to prohibit an employer from discharging, expelling, or otherwise discriminating against a person for (1) opposing a discriminatory compensation practice, (2) filing a complaint about one, or (3) assisting any proceeding regarding one. This covers employees who do not file a complaint, but who assist in the investigation regarding one.

The act eliminates the $200 fine for whistleblower violations, but expands potential court awards for such violations to include compensatory and punitive damages.

OTHER APPLICABLE STATE AND FEDERAL ANTIDISCRIMINATION LAW

In certain ways, the act's changes to the labor law make it easier to bring a claim under it than under state human rights laws or the federal antidiscrimination law. (The state human rights law includes a provision that its prohibition on discriminatory employment practices does not void or supersede the labor law prohibiting gender wage discrimination (CGS 46a-62). )

Under the act and prior labor law, there is no minimum size of employer that triggers labor law coverage. The state human rights law covers employers with three or more employees and the federal law covers employers with 15 or more employees.

The act gives employees two years from the date of a violation to file a claim. It specifies a continuing violation occurs each time wages, benefits, or other compensation that results from a discriminatory decision or practice is paid. (This matches the language in a new federal law, the Lilly Ledbetter Fair Pay Act of 2009, see BACKGROUND. ) Under this act a decision to pay employees differently based on gender is still a violation even if it were made years ago, because each new paycheck based on that decision is a continuing violation. The state human rights law generally requires a complaint be filed within 180 days of the alleged discrimination. But the relevant regulations permit a complaint to be deemed valid if filed within 180 days of the date the complainant knew or reasonably should have known the alleged discrimination occurred (Conn. Agencies Regs. 46a-54-34a).

The act prohibits gender wage discrimination at an employer's business, which is a broader term than that used in the federal law. The federal Equal Pay Act, which Ledbetter amended, prohibits discrimination in the same work establishment (see BACKGROUND). For some employers with worksites at different locations, the term “establishment” limits the scope of the federal law. In other words, the federal law might not cover a pay differential at different worksites, but the state law would apply.

BACKGROUND

Equal Pay Act of 1963

The federal Equal Pay Act of 1963, as amended, requires that men and women be given equal pay for equal work in the same establishment. The jobs need not be identical, but must be substantially equal in skill, effort, and responsibility and performed under similar conditions. The U. S. Equal Employment Opportunity Commission enforces the law.

Lilly Ledbetter Fair Pay Act of 2009

This law amends the Equal Pay Act of 1963 to specify that an unlawful employment practice occurs when a (1) discriminatory compensation decision or other practice is adopted; (2) a worker becomes subject to the decision or practice; or (3) a worker is affected by the application of such a decision or practice; including each time wages, benefits, or other compensation is paid. The law is Congress's response to a U. S. Supreme Court ruling finding that Lilly Ledbetter's complaint against Goodyear Tire & Rubber Co. was time-barred because she did not file it within 180 days of the time Goodyear first paid her less than her male peers (Ledbetter v. Goodyear Tire & Rubber Co. , 550 U. S. 618 (2007)). She only discovered the discrimination after years of unequal pay.

Personnel Files Act

This state law imposes certain requirements on employers who keep employee personnel and medical records. The law requires the employee's written consent, in most cases, before an employer can disclose individually identifiable information other than the employee's dates of employment, job title, and wage or salary.

The employer must also allow an employee access to personnel files and, in the case of medical files, allow access by a physician chosen or approved by the employee. The employers must maintain both types of files for a certain period after a worker stops working for the employer and must abide by other statutory requirements.

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