Congress has passed and sent the Lilly Ledbetter Fair Pay Act to President Obama for signature. The President has expressed support for the Act, which is intended to overrule the Supreme Court's 2007 decision in Ledbetter v. Goodyear Tire and Rubber Co., 550 U.S. 618 (2007).
In Ledbetter, the Court held that Title VII's charge filing period ran from the date on which a discriminatory pay decision was made and that each subsequent paycheck did not start a new limitations period. The Act amends Title VII to start the limitations period from either: (1) the date the discriminatory pay decision was made, (2) the date the employee became subject to a discriminatory practice or decision, or (3) the date when the employee was affected by the application of the discriminatory practice.
The law specifically states that the charge filing clock resets each time an employer pays wages reflecting a previous discriminatory decision, but that damages may only be collected for back wages within the two years prior to the filing of the charge. The Act also will give individuals that same flexibility in pay discrimination claims under the ADEA and ADA and will increase employers' potential exposure to pay discrimination claims overall.