June 5 2012

Washington Free Beacon: The equal pay payoff

 

As seen in the Washington Free Beacon.

DEMOCRATS PUSH FOR VOTE ON THE PAYCHECK FAIRNESS ACT TO BENEFIT AMBULANCE CHASERS
BY: Andrew Stiles - June 5, 2012 5:00 am

Senate Democrats plan to force a symbolic vote Tuesday on the Paycheck Fairness Act (PFA), a controversial piece of legislation that experts say would do little to combat employment discrimination while enriching a key Democratic constituency.

“This legislation has nothing to do with ending discrimination,” said Carrie Lukas, managing director of the Independent Women’s Forum. “It wouldn’t even benefit women, it would benefit lawyers.”

Democrats argue that the PFA is a necessary complement to the Lilly Ledbetter Fair Pay Act of 2009, the first piece of legislation President Obama signed upon taking office.

The Fair Pay Act was designed to make it easier for female workers to file discrimination lawsuits, but such lawsuits have actually declined slightly since 2009. Since Obama took office, the U.S. Equal Employment Opportunity Commission (EEOC) has filed just six gender-based wage discrimination lawsuits, down from 18 filed during the last three years of George W. Bush’s term.

The PFA would make such lawsuits more common and far more lucrative, critics say, by making it easier for employees to join large class-action lawsuits and allowing them to seek unlimited punitive damages for discrimination.

The trial lawyers who would administer and profit from such lawsuits constitute one of the Democratic Party’s most reliable sources of political contributions.

Lawyers and law firms contributed more than $230 million in 2008 to federal political candidates and committees, 76 percent of which went to Democrats. The industry gave $43.2 million to Obama in 2008, and was his top source of campaign donations.

“It is an employment act for trial lawyers,” Diana Furchtgott-Roth, a senior fellow at the Manhattan Institute and former chief economist at the U.S. Department of Labor, said of the Paycheck Fairness Act. “But it would discourage employers from creating jobs, and make them less likely to hire women.”

Business groups such as the U.S. Chamber of Commerce oppose the PFA, arguing that it would impose undue burdens on businesses and expose them to expensive, unwarranted lawsuits.

“This bill would, among other things, expand remedies under the [Equal Pay Act of 1963] to include unlimited punitive and compensatory damages, significantly erode employer defenses for legitimate pay disparities, and impose invalid tools for enforcement by the Labor Department,” the group said in a letter announcing its opposition to the bill.

The PFA has no chance of getting the 60 votes required to proceed in the Senate, and the House is unlikely to take up the measure. Critics have accused Democrats of pushing the bill for political reasons.

“It’s pure politics, part of their view of the so-called Republican ‘war on women,’ which is a non-existent war on women,” Furchtgott-Roth said. “They know Republicans are going to be against it, and who accept except the purely evil could be against pay equity?”

This is standard operating procedure for Democrats, said Jay Cost, a political analyst and author of Spoiled Rotten: How the Politics of Patronage Corrupted the Once Noble Democratic Party and Now Threatens the American Republic.

“They always couch their demands in communitarian rhetoric: labor unions support ‘workers rights’; environmentalists support ‘clean water’; how could anyone be against those?” Cost said. “As usual, ‘paycheck fairness’ is just another huge bonanza for a special interest group tied to the Democratic Party.”

Even though the bill is not going to pass, Cost argued, it is a signal to the trial lawyer industry that Democrats are looking out for their interests.

“This is just a purely symbolic show of support for the trial lawyers,” he said. “They are one of those sacred groups that Democrats never, ever, ever cross. They have a ton of money, they’re professional and well-organized, and they’ve bought their way into the Democratic coalition.”

They are also a potentially crucial source of funding in what is sure to be a hard fought campaign for the White House and control of the House and Senate in 2012.

President Obama went out of his way to announce his support for the PFA, making asurprise appearance on a White House conference call on Monday, praising the bill and urging Congress to “step up and do its job” by passing it.

“If Congress passes the Paycheck Fairness Act, women are going to have access to more tools to claim equal pay for equal work,” Obama said. “If Congress doesn’t act, then women are still going to have difficulty enforcing and pressing for this basic principle.”

It is not the first time Congress has considered the PFA. It passed the House in January 2009, but fell short in the Senate in November 2010. At the time, even the editorial pages of the Boston Globe and Washington Post raised doubts about the bill’s efficacy.

The bill was “not the right fix” for the problem of pay equity, the Post’s editors wrote, and “would allow employees and courts to intrude too far into core business decisions.”

The Globe agreed that the PFA was “too deep an intrusion” into common business practices and “too broad a solution to a complex, nuanced problem.”

“The bill would create too strong a presumption in favor of discrimination over other, equally plausible explanations for disparities in salaries,” wrote the Globe’s editors. “In addition, the threat of much higher damages awards by juries might lead businesses to make quick settlements for frivolous claims.”

Such consequences may be bad for businesses and the economy, but they would be a boon for trial lawyers, critics say.

About 60 percent EEOC discrimination claims in 2010 were found to have no merit.

Sen. Chuck Schumer (D., N.Y.) said on a Monday conference call with White House adviser Valerie Jarrett that opponents of the PFA “don’t have any good arguments.”

A recent Washington Free Beacon analysis found that Schumer, who runs the Senate Democratic messaging operation, paid his male staff members $19,454 more on average than female staffers, a 36 percent difference.

That is well above the 23 percent gap that Democrats claim exists between male and female workers nationwide. The figure is based on a 2010 U.S. Census Bureau report, and is technically accurate.

However, as CNN’s Lisa Sylvester has reported, when factors such as area of employment, hours of work, and time in the workplace are taken into account, the gap shrinks to about 5 percent.

The same Free Beacon analysis found that a majority of Senate Democrats paid women less; 14 paid their female employees more than 23 percent less than male employees.

Other provisions in the bill would establish a “national award for pay equity in the workplace” and would “create a competitive grant program to provide negotiation skills training programs for girls and women.”

A Republican Senate aide said he was shocked to find the latter provision in a Democratic press release.

“Really? Women can’t negotiate without some Democrat giving them government money to take a class?” the aide said. “Maybe they should direct that money to Senate Democratic offices.”

 

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