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For Immediate Release: Thursday, June 28, 2007
Contact: Jenice Robinson or Ranit Schmelzer, 202-588-5180
NWLC: CONGRESS SHOULD OVERTURN CAPS ON TITLE VII DAMAGES
Greenberger Testifies Before House Judiciary Subcommittee
(Washington, D.C.) The National Women’s Law Center today asked lawmakers to reconsider the arbitrary caps on damages that employees can recoup in Title VII discrimination cases.
In testimony before the House Judiciary Committee’s Subcommittee on the Constitution, Civil Rights and Civil Liberties, NWLC Co-President Marcia D. Greenberger told lawmakers that the arbitrary limits on the damages that individuals may receive for sex, religion and disability discrimination often fail to fully compensate employees and are often too low to deter discrimination.
The Subcommittee hearing was held in the wake of the Supreme Court’s decision in Ledbetter v. Goodyear Tire & Rubber Co. In that case, the Supreme Court dismissed Lilly Ledbetter’s pay discrimination claim altogether, but only after the damages that were awarded her by a jury were reduced by the trial judge to fit within the caps set by statute. Under amendments to the civil rights laws passed in 1991, plaintiffs may receive compensatory and punitive damages for intentional violations of Title VII, but those damages are limited to $50,000 to $300,000 depending on the size of the employer.
“Capped damages create a perverse incentive that allows employers to gamble that it costs less to pay damages than to create workplaces free of discrimination. This is contrary to the intent of Title VII,” Greenberger said. “Caps on damages also mean that employees who suffer the most harm or are subject to the most egregious discrimination often cannot be fully compensated for the injuries they endure.”
In the Ledbetter case, the jury awarded Lilly Ledbetter $3.28 million in compensatory and punitive damages, but the award was reduced to about one-tenth of that amount – $300,000 – to fit within the statutory caps. This award was an insignificant loss for Goodyear, which employs 80,000 people and brought in revenues of almost $20 billion in 2005.
The caps on compensatory and punitive damages also effectively create two tiers of employment discrimination lawsuits. Employees who are subject to discrimination because of their race or national origin are not subject to caps because they can sue for damages under a different statute. But employees who are discriminated against on the basis of sex, religion or disability are subject to the caps.
“The law as it stands sends a message that one form of discrimination is more tolerable than another,” Greenberger said. “We need laws in place to effectively protect employees from workplace discrimination. We also need appropriate deterrents in place to ensure that we don’t create environments in which employers can calculate punitive damages as simply the cost of doing business.”
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