The chosen issue is that of pay discrimination in the workplace based on gender. Lilly Ledbetter worked for Goodyear for almost 20 years (Ledbetter, 2006). She sued after taking early retirement, claiming that she had been discriminated against by some of her supervisors because of gender, resulting in smaller paychecks than male colleagues (Ledbetter, 2006; Fieser, 2015). The jury awarded her back pay and damages. Goodyear appealed, stating that she had not filed her complaints in time The 11th circuit court reversed, and the United States Supreme Court upheld the decision of the 11th circuit, deciding that “the EEOC charging period ran from the time when the discrete act of alleged intentional discrimination occurred, not from the date when the effects of this practice were felt” (Ledbetter, 2006), suggesting that one has to file a discrimination claim before one is aware that they could suffer damage. Following Ledbetter’s loss at the Supreme Court, court filings showed that she was aware in 1992 (Bader, 2013). Still, her protests led to the Lilly Ledbetter Fair Pay Act, which states that each paycheck paid as the result of discrimination restarts the 180-day clock for filing a claim. Although Bader (2013) claims that the Ledbetter (2006) decision did not stop such claims, Brake and Grossman (2007) also state that the decision renders Title VII ineffective in preventing discrimination, since it may occur before the employee is aware of it.
Corporations should be barred from wage discrimination. The law at the time required filing with the EEOC within 180 days of the initial discriminatory decision. Once the decision had been made, the issuance of each paycheck was not a discriminatory act. The eventual passage of the Lilly Ledbetter Fair Pay Act provided that the 180-day clock was reset with each paycheck (Bader, 2013), making it easier for employees to sue for discrimination at any time. This requires increased vigilance by corporations that their employees are not being discriminated against. Otherwise, they will suffer higher levels of damages from jury awards. This may require higher pay for women and minorities and/or increased legal oversight of pay levels, increasing the cost of doing business. But all businesses will be held to the same standard, maintaining a competitive business environment.
The economic systems involved in this case are the capitalist free-market system constrained by the socialist system, as stated by economist Milton Friedman (1970). Friedman states that businesses are only in business to make profit, although he acknowledges that this must be within the constraints of law and “ethical custom”. However, he is skeptical of every effort to impose ethical standards on the corporation as spending other people’s money – reducing returns to stockholders, raising prices to customers, and/or lowering wages to employees. At this point, the executive is a public employee making decisions for social good based upon politics. He states that when decisions regarding the allocation of resources are based upon political, not market, mechanisms, that is socialism. Friedman also goes into significant detail regarding why the corporate executive is not the best person to make sociopolitical decisions. He concludes that the notion of corporate social responsibility is “subversive”.
The chosen ethical theory is virtue ethics. Utilitarianism seems inadequate to many ethical dilemmas. For example, under the utilitarian view, employees can be underpaid because the business makes extra profits when it does so. Deontology, with its emphasis on rules, seems too stuck in tradition and legalese. For example, the law as it applied to the Ledbetter case required certain filings to be filed with the EEOC within 180 days, but there is no reason for the superiority of an arbitrary number. Virtue ethics, in contrast, allow decisions on right and wrong based upon our own sense of morality. It is not ethical to pay different wages to different employees for the same work, especially in a pattern that disadvantages women and/or minorities.
Therefore, Ledbetter may have slightly mischaracterized the Supreme Court decision that was handed down as the result of her case (Bader, 2013), regardless of when the discrimination took place and when Ledbetter was able to make her claim (i.e., knew discrimination had occurred) or actually did make her claim. Nevertheless, the ethical response was that of Congress to pass laws making discrimination remedies more accessible to employees suffering discriminatory treatment.
- Bader, H. (2013). Misconceptions about Ledbetter v. Goodyear Tire & Rubber Co. Engage, 13(3), 26-30. Retrieved from http://www.fed-soc.org/publications/detail/misconceptions-about-ledbetter-v-goodyear-tire-rubber-co.
- Brake, D.L., & Grossman, J.L. (2007). Title VII’s protection against pay discrimination: The impact of Ledbetter v. Goodyear Tire & Rubber Co. Regional Labor Review, 10(1), 28-36. Retrieved from http://www.hofstra.edu/pdf/academics/colleges/hclas/cld/cld_rlr_fall07_title7_grossman.pdf.
- Fieser, J. (2015). Introduction to Business Ethics [electronic version]. Retrieved from https://content.ashford.edu.
- Friedman, M. (1970). The social responsibility of business is to increase its profits. New York Times. Retrieved from http://highered.mcgraw-hill.com/sites/dl/free/0073524697/910345/
- Ledbetter v. Goodyear Tire & Rubber Co. 550 U.S. 618 (2006). Retrieved from https://www.law.cornell.edu/supct/html/05-1074.ZO.html.