Ledbetter act only Affects Limitations Period for Claims Involving Actual Discrimination in Pay

In 2003 and 2004, a school district eliminated two employees’ custodial positions. The district offered the employees lower-paying janitorial jobs along with a promise to maintain their prior pay for two years. The employees accepted and continued to receive higher custodial wages until the pay cuts took effect in 2005 and 2006. When those pay cuts went into effect, the employees filed administrative charges alleging that the school district had violated the Age Discrimination in Employment Act (ADEA) by forcing them into lower-paying positions because of their age. The district court concluded that the charges were barred because they had not been filed within 300 days of the discriminatory decisions in 2003 and 2004, as required by the ADEA. The employees appealed based upon the Lilly Ledbetter Fair Pay Act of 2009 (Act). The Act changed how the limitations period is calculated for claims under the ADEA and Title VII of the Civil Rights Act of 1964, as amended, that involve “discrimination in compensation.” Under the Act, in applicable cases, each paycheck issued to an employee is treated as a new act of discrimination, and thus each paycheck resets the 300-day limitations period. The employees argued that their charges were filed within 300 days of their most recent paychecks, and therefore were timely under the Act. The U.S. Court of Appeals for the Tenth Circuit rejected this argument, holding that the Act was intended as a narrow adjustment that only applies to claims involving actual discrimination in rates of pay (i.e., unequal pay for equal work). In this case, the employees had alleged discrimination in their demotion, not that younger employees were paid more for equal work. Accordingly, the employees’ 2005 and 2006 paychecks were not fresh acts of discrimination under the Act, and their claims were time-barred. This decision is a positive development for employers and if followed by other federal courts will limit the Act to claims involving actual pay discrimination and will not allow employees to bring stale claims involving other forms of discrimination.

Almond v. Unified Sch. Dist. #501, No. 10-3315 (10th Cir. Nov. 29, 2011).