A proposal to make it easier for workers to sue their employers—and offering an unlimited cap on damages—has been defeated in the U.S. Senate. The so-called “Paycheck Fairness Act” would have opened employers to far greater exposure to litigation and its costs, and would have made it tougher for businesses to fight complaints, even if pay disparities were unintentional.

Senate Democrats could not get the votes to overcome a Republican-led filibuster of the legislation that would have expanded the existing Equal Pay Act of 1963, and was a significant part of the pro-labor agenda on Capitol Hill. Leading the battle against the legislation were the U.S. Chamber of Commerce, National Association of Manufacturers (NAM), and other business groups.

The bill probably would have opened the door to more frivolous class-action suits. Employers would probably have felt pressured to buy additional legal liability insurance—increasing their costs and decreasing their ability to raise wages, increase benefits or add jobs. Proposals such as the “Paycheck Fairness Act” only increase employers’ costs and weaken their ability to grow jobs.

For more information, contact CBIA’s Kia Murrell at 860.244.1931 or kia.murrell@cbia.com.