The Ledbetter Act prohibits discrimination against all of the protected categories under Title VII of the Civil Rights Act of 1964, the Age Discrimination in Employment Act, the Americans with Disabilities Act, and the Rehabilitation Act. These protected categories include race, color, religion, national origin, age, and disability. The Ledbetter Act establishes that each discriminatory paycheck is considered a new act of discrimination, which resets the 180-day statutory limit to file a discrimination claim. It also limits the ability of employees to recover back pay for no more than two years before they raise the discrimination claim. The law creates an incentive for employers to correct any continuing discriminatory pay practices. Employers will no longer be able to rely on keeping discriminatory pay initially hidden as a way to avoid liability.
The Ledbetter Act was inspired by Lilly Ledbetter, who worked for Goodyear in Gadsden, Alabama for 19 years, and is now retired. Ledbetter filed a complaint with the United States Equal Opportunity Employment Commission (EEOC) in March 1998. She alleged that men at her Goodyear plant, who performed similar work, were paid 15 to 40 percent more than she was paid. Employment records supported Ledbetter’s claim and she demonstrated that she was being paid $6,000 less than men doing identical work. This group of employees included those who were the lowest paid in their job category.
The EEOC and a jury ruled in Ledbetter’s favor, and she was awarded $360,000 in back pay. However, the United States Court of Appeals for the Eleventh Circuit later rejected Ledbetter’s claim. The court chose to limit her lawsuit to discrimination, which may have happened in the six-months prior to her complaint with the EEOC. A three-judge panel also dismissed the pay discrimination allegations during that 180-day time period. Then, in a 5-4 ruling, the United States Supreme Court ruled in favor of Goodyear in Ledbetter v. Goodyear Tire & Rubber Co., Inc., 550 U.S. 618 (2007). The court concluded that Ledbetter had only a 180-day window in which to make her initial claim. The Ledbetter Act, thus, overrides this Supreme Court ruling.
Changes in Minimum Wage Requirements Nationwide
Eleven states have increased the minimum wage for employers subject to state wage and hour laws since January 1, 2009.
- Arizona - Minimum wage increase to $7.25 per hour
- Colorado - Minimum wage increase to $7.28 per hour; Tipped employees must be paid at least $4.26 an hour, with tips and wages totaling at least $7.28 an hour
- Connecticut - Minimum wage increase to $8.00 per hour
- Florida - Minimum wage increase to $7.21 per hour; Tipped employees must be paid a direct wage equal to the minimum wage of $7.21 minus $3.02 (the tip credit under the federal Fair Labor Standards Act), or $4.19 per hour
- Missouri - Minimum wage increase to $7.05 per hour*; Tipped employees must be paid by their employer at least 50% of the minimum wage rate and tips plus cash wages must equal at least $7.05 per hour
- Montana - Minimum wage increase to $6.90 per hour* (Employers are prohibited from using tips to reach the minimum wage owed the employee)
- New Mexico - Minimum wage increase to $7.50 per hour
- Oregon - Minimum wage increase to $8.40 per hour
- Vermont - Minimum wage increase to $8.06 per hour; Tipped employees must be paid at least $3.91 per hour, and cash wages plus tips must equal at least $8.06 per hour (Employer must make up the difference if the wage falls short of the minimum wage)
- Washington - Minimum wage increase to $8.55 per hour (Employers are prohibited from using tips to reach the minimum wage owed the employee)
*Note: On July 24, 2009, when the federal minimum wage increases to $7.25, employers must pay the higher federal minimum wage.
The current Federal Minimum wage is $6.55 per hour and will increase to $7.25 per hour as of July 24, 2009. Among individual states, the United States Department of Labor Wage and Hour Division indicates that, Washington has the largest minimum wage of $8.55 per hour and Kansas has the lowest minimum wage of $2.65 per hour (as of January 1, 2009). Meanwhile, Alabama, Louisiana, Mississippi, South Carolina, and Tennessee do not currently have state mandated minimum wage requirements.
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