Thursday, Jun. 28, 2007
Headline of the week: State budget proposal seeks to cut interest payments in bias cases
MBA member attorney Bryan Decker calls proposal "bad public policy"
A proposal in the pending state budget would slash the interest rate paid on legal judgments awarded in discrimination cases, cases where the plaintiffs are typically victims of racial bias, wrongful firings and discriminatory landlords.
Interest paid on judgments is designed to compensate victims for the time they spend waiting for monetary awards won in litigation. It also has the practical effect of encouraging opposing parties to resolve disputes quickly and discouraging losing litigants from filing frivolous appeals, since interest can dramatically increase the size of an award.
The interest paid on discrimination judgments is now set by state statute at 12 percent. But under the terms of the proposal, it would be tied to the one-year treasury yield, an amount that is currently about five percent and has dipped much lower in recent years. Other types of judgments would continue to accrue 12 percent interest.
The original proposal, by Attorney General Martha Coakley, applied only to public employers -- such as municipalities, housing authorities and other government agencies -- and was meant to reduce the burden on taxpayer-funded budgets. It was amended to include private employers by state Sen. Steven A. Baddour, D-Methuen, and it could apply to pending cases as well as future ones.
MBA Labor and Employment Section Council member Bryan Decker, Sandulli Grace PC, provided comment regarding this proposal to MBA e-Journal. "This proposal applies only in situations where an employer has been found to discriminate. Interest on a judgment is an incentive not to file frivolous appeals and to compensate the plaintiff for the fact they didn't have use of the money. To say we will pay less interest to someone discriminated against than to a company whose contract was violated is just bad public policy," said Decker.
He said that the clear intent of chapter 151B and the anti-discrimination laws is to eradicate workplace discrimination. "Treating discrimination cases less favorably than other cases undermines that intent."
Nor does he care for the original Coakley proposal. Although 80 percent of Decker's practice is representing public employees and public employee unions, he says he is not insensitive to the fiscal concerns of public employers. "But that doesn't undermine the argument that taxpayers shouldn't save money by reducing the burden on public entity discriminators. They should not be held to a lower standard than those who discriminate in the private sector."
The MBA opposes this state budget proposal.