Sen. Mike Johanns (R-Neb.) sided with small businesses, employers, and employees who would be unduly harmed by the government intrusion contained in a bill rejected today in the U.S. Senate. The bill, titled the Paycheck Fairness Act by its proponents, would require unprecedented annual compensation reporting to the federal government, provide for unlimited punitive and compensatory damages in employee discrimination lawsuits, and clog the federal court system by fostering more and larger class action lawsuits. The vote to proceed to the bill, which required 60 votes, failed, 52-47.
"There is a wide margin between what this bill's supporters say it will do and the actual impact it will have on employers and employees," Johanns said. "While national unemployment continues to rise, allowing more government intrusion without actually addressing the nearly 8 percent of women who are unemployed and searching for jobs would be tremendously unfortunate. The real winners here would have been the trial lawyers who stand to see a spike in frivolous lawsuits as a result of this bill."
* Discrimination of employees is already covered by current law in both the Equal Pay Act and Title VII of the Civil Rights Act.
* Of the 32,789 claims of sex-based discrimination in fiscal year 2011, the U.S. Equal Employment Opportunity Commission (EEOC) determined there was no evidence of discrimination in 63 percent of those cases. Workers received more than $150 million through Title VII and Equal Pay Act claims last year alone.
* The Association of Chief Human Resources Officers says the legislation "would subject companies to an explosion in costly employment litigation even where the employer has no intent to discriminate."
* The bill could restrict employees' ability to negotiate for higher salaries with their employer and could even prevent employers from offering merit-based bonuses.
* The legislation would encourage a flood of costly litigation by changing current law related to class action lawsuits.
o Under the bill all potentially affected employees are automatically enrolled in class-action lawsuits brought against their employers. Current law requires workers to give written consent to join a class action lawsuit.