Cleveland partner Todd Lebowitz authored an article, "Ledbetter Act Expands Statutes of Limitation, Exposes Employers to Liability for Decisions Made Many Years Earlier," which was published in the April 10, 2009, edition of Mealey's Litigation Report: Employment Law.
According to Lebowitz, "The Lilly Ledbetter Fair Pay Act [signed by President Obama in January 2009] extends statutes of limitation for claims of pay discrimination under most federal anti-discrimination laws. Retroactive to May 28, 2007, the Ledbetter Act now allows an employee to file suit for discriminatory decisions made long ago if the employee’s pay is still affected by the results of the decision. Although recovery of back pay is limited to two years, other remedies are also available, including punitive damages, injunctive relief, and in some cases, emotional distress damages. Injunctive relief may include a court order to reinstate or promote an aggrieved employee. The effect of the Ledbetter Act is that employers may now be held liable for employment decisions made years or even decades earlier, if the effects of those decisions are still reflected in employees' compensation."
Lebowitz's article goes on to explain the ramifications of the new language which expands the definition of an "unlawful employment practice" and the steps employers should consider to limit exposure to Ledbetter Act claims, including reviewing their document retention policies and record creation practices, and taking a "fresh look at their pay scales and compensation levels."
Lebowitz concludes: "All employers need to be aware of the effect the Ledbetter Act may have on their exposure to future lawsuits. Whether and how to change current practices, however, is an individual decision that will vary by employer and should be made after consideration of all circumstances. Consultation with employment litigation counsel may be helpful in assessing the available options and selecting a course of action that helps to minimize the risk of future litigation."