What Is the Lilly Ledbetter Fair Pay Act?

The Lilly Ledbetter Fair Pay Act of 2009 is a law enacted by Congress that bolstered worker protections against pay discrimination. The act allows individuals who face pay discrimination to seek rectification under federal antidiscrimination laws. The law clarifies that discrimination based on age, religion, national origin, race, sex, and disability will “accrue” every time the employee receives a paycheck that is deemed discriminatory. It was the first bill that President Barack Obama signed into law and is one of a number of federal laws designed to protect the rights of workers.

Key Takeaways

  • The Lilly Ledbetter Fair Pay Act of 2009 addressed wage discrimination on the basis of age, religion, national origin, race, sex, and disability.
  • This fair wage act supplanted a Supreme Court ruling that wage discrimination cases must be filed within 180 days of the start of the discrimination.
  • The Lilly Ledbetter Fair Play Act effectively resets the clock by saying that wage discrimination cases can be filed within 180 days of the last paycheck in which the discrimination occurs.

Understanding the Lilly Ledbetter Fair Pay Act

The Lilly Ledbetter Fair Pay Act reinstated the protection against pay discrimination that had been removed by the Supreme Court in Ledbetter v. Goodyear Tire and Rubber Co. in 2007. It restored previous protections regarding the equal treatment of employees, most notably Title VII of the Civil Rights Act of 1964. The 2009 statute clarified that any inequitable payments are unlawful, even if they result from a pay decision made in the past.

The Act is named in honor of Lilly Ledbetter, a former manager at a Goodyear Tire & Rubber Co. plant in Alabama. After Ledbetter discovered that her male peers were receiving substantially higher pay for similar roles, she filed a complaint with the Equal Employment Opportunity Commission (EEOC). In 1998 Ledbetter filed an equal-pay lawsuit alleging pay discrimination on the basis of sex under Title VII of the Civil Rights Act of 1964. The trial jury awarded her back pay and about $3.3 million in compensatory and punitive damages.

However, the Supreme Court upheld a lower court ruling that said claims like Ledbetter’s had to be filed within 180 days of an employer’s decision to pay a worker less, even if the worker didn’t learn about the unfair pay until much later. As a result, Ledbetter never collected any kind of settlement from Goodyear.

The ruling ignited activist groups who saw the court's decision as a setback for women and civil rights. This led to the creation of a bill that bore Ledbetter's name that gives employees the right to file suit 180 days after the last pay violation and not only 180 days after the initial pay disparity. In effect, each paycheck restarts the 180-day countdown to file a claim.

79¢

The amount women are paid in America in 2019 for every dollar made by men.

Special Circumstances of the Lilly Ledbetter Fair Pay Act

One documented area of pay discrimination is the pay gap between men and women. As of 2019 it was estimated that, on average, women are paid only 79 cents for each dollar men are paid for comparable work. The gap becomes wider when examining pay data for black and hispanic women, who get 74 cents on the white male dollar, according to the research firm PayScale.

In addition, many experts believe that the practice by which prospective employers ask job candidates about salary history furthers the pay gap. As of August 2019, 14 states (and 10 localities) prohibited employers from asking about salary history. They are Alabama, California, Connecticut, Delaware, Illinois, Maine, Massachusetts, Michigan, New Jersey, New York, Oregon, Pennsylvania, and Washington.