In a 7-2 decision, the Supreme Court ruled today that maternity leave taken before the passage of the 1978 Pregnancy Discrimination Act does not have to be counted in calculating an employee’s pension benefits.
Prior to the 1978 Pregnancy Discrimination Act, employers could subtract time taken off for maternity leave when calculating an employee’s pension upon retirement even though time off for other medical-related leaves were not subtracted. Noreen Hulteen and three other AT&T employees who took maternity leaves between 1968 and 1976 (prior to the passage of the Pregnancy Discrimination Act) sued AT&T to have their maternity leave time credited toward their pension calculations. The legal battle made it all the way the Supreme Court after the 9th Circuit Court of Appeals held for the women.
Citing an amendment to Title VII signed into law by President Obama, lawyers for the women argued that each reduced payment is itself an act of discrimination in violation of the Pregnancy Discrimination Act. (The Title VII amendment was adopted in response to another Supreme Court decision, which held that the 180-day statute of limitations had passed for the plaintiff employee to sue for pay discrimination. Pursuant to the amendment to Title VII, the 180-day statute of limitation runs anew with each new paycheck issued, making it far more plausible for employees to bring pay discrimination claims.) The Supreme Court did not buy that argument and reversed the 9th Circuit Court’s holding. In its decision issued on May 18, 2009, the Supreme Court instead favored the arguments made by the AT&T lawyers that the Pregnancy Discrimination Act does not apply retroactively and that the pensions were therefore correctly calculated according to the laws in effect at the time the women took their maternity leaves.
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