On January 29, 2009, President Obama signed into law the Lilly Ledbetter Fair Pay Act. The legislation effectively reverses a 2007 ruling by the United States Supreme Court and provides workers with additional time to file charges of pay discrimination. In Ledbetter v. Goodyear Tire & Rubber Co., the Supreme Court held that Ms. Ledbetter waited too long to bring a claim of gender discrimination since she had been paid less than her male counterparts for the vast majority of her 19-year career. Under Title VII of the Civil Rights Act of 1964, as amended, employees have 180 days to bring a charge of discrimination. The Supreme Court held that an employee was required to file a discrimination charge within 180 days of the initial decision to pay a worker less than another for doing the same job, and that each allegedly discriminatory paycheck did not restart the statute of limitations as had been routinely held by the courts.

The new legislation makes it clear that each paycheck received does reset the 180-day limit to file a charge. As such, it provides employers with the incentive to correct discriminatory pay practices in order to ensure that employees are being compensated fairly. Employees who bring a charge of discrimination may recover back pay for no more than two years, regardless of the length of discrimination alleged. Although the Supreme Court case that provided the impetus for the legislation was based on gender discrimination, the Act applies to all forms of workplace discrimination, including, race, religion, national origin, disability and age.