The Lilly Ledbetter Fair Pay Act of 2009, which became law on January 29, eases time limits on wage discrimination claims, making employers more vulnerable to pay discrimination lawsuits. And the current economic climate makes employees more likely to file suits.
On January 29, 2009, President Obama signed the Lilly Ledbetter Fair Pay Act of 2009, which overrules a 2007 Supreme Court ruling, Ledbetter v. Goodyear Tire & Rubber Co., Inc. In the case, the Court did not address Ledbetter’s claim of pay discrimination, but ruled only on the statute of limitations, saying that a compensation discrimination charge must be filed within 180 days of a discriminatory pay-setting decision (or 300 days in jurisdictions that have a local or state law prohibiting the same form of compensation discrimination). The Act restores the pre-Ledbetter position of the Equal Employment Opportunity Commission that each paycheck that delivers discriminatory compensation is a wrong actionable under the federal EEO statutes, regardless of when the discrimination began.
Lilly Ledbetter started work as a salaried factory worker at the Goodyear Tire & Rubber Co. in 1979. By the time she retired in November 1998, she was earning $3,727 per month, as compared to 15 men with similar qualifications who had started at the same pay but who then earned from $4,286 to $5,236 per month. She filed a complaint with the EEOC, claiming that each paycheck she received that was less than her male counterparts’ was a discriminatory action; the claim ended up in the Supreme Court.
Under the Act, individuals can now file a charge each time they receive compensation that is based in whole or part on the discriminatory decision or other practice. It allows individuals to recover back pay for up to two years preceding the filing of the charge and has a retroactive date of May 28, 2007, applying to all claims of discriminatory compensation pending on or after that date.