On January 29, 2009, President Barak Obama signed into law the Lilly Ledbetter Fair Pay Act of 2009. So, what is the Lilly Ledbetter Fair Pay Act (Fair Pay Act)? Well, the Fair Pay Act states that an employee can file a lawsuit against his or her employer for every "unlawful employment practice" related to compensation, including every check in which an employee is underpaid. In other words, every time an employee receives a paycheck based on an unlawful employment practice (such as being underpaid), that paycheck constitutes a new cause of action.

The Fair Pay Act overturned the U.S. Supreme Court’s decision in Ledbetter v. Goodyear Tire & Rubber Co, 550 U.S. 618 (2007), which held that employees were required to file pay discrimination lawsuits against their employers within 180 days (or 300 days under certain state laws) of an employer’s initial discriminatory compensation decision. So, for example, if an employer underpaid an employee from his or her date of hire, that employee would only have 180 days (or 300 days under certain state laws) to file a lawsuit against the employer based on the employer’s decision to underpay the employee – no matter how long the employee worked for the employer. If this still sounds a little confusing, we’ll go over an example below to clarify how it works.

As you can see, under the new law, each violation creates a new right to file an action for pay discrimination. This is in contrast to the old law where the female employee would have to had filed her discrimination claim based on the date of the very first pay violation.

In this article, we’ll explore the facts behind the Fair Pay Act, how the Fair Pay Act works, and show some ways in which employers can comply with the Act.

Next, we’ll go over the facts behind the Fair Pay Act.