In Noel v. The Boeing Company, 2010 WL 381 (3d. Cir. 2010), the court recently ruled that the Lilly Ledbetter Fair Pay Act of 2009 (Ledbetter Act) does not apply to failure to promote discrimination claims. In doing so, the court indicated that the Ledbetter Act may not be utilized to extend the statute of limitations for discrimination claims related to discrete acts such as being unlawfully hired, fired or denied a promotion.

Noel is a black Haitian national who began working for Boeing as a sheet metal assembler in 1990. In November 2002, Boeing transferred Noel to Amarillo, Texas. Boeing gave two white employees similar assignments and all three received a salary increase and were promoted from Labor Grade 7 to Labor Grade 8. In approximately May of 2003, Boeing promoted the two white employees to Offsite Mechanic General, Labor Grade 11, while Noel remained at the lower paying Grade 8.

Noel complained about these promotions to his union representative and a Boeing labor relations representative, but his complaints went unanswered. On March 25, 2005, Noel filed a charge with the EEOC alleging that Boeing unlawfully failed to promote him based upon his race and national origin, and later filed a lawsuit asserting the same claims. The district court dismissed the claim on the grounds that it was not timely filed.  

Noel appealed, relying in part on the Ledbetter Act. Noel argued that, as result of not being promoted, he received less pay than his white co-workers throughout his time at the Amarillo plant. Thus, Noel asserted that, pursuant to the Ledbetter Act, each paycheck he received started the administrative clock anew.

The court of appeals affirmed the district court's decision. The court recognized that, pursuant to the Ledbetter Act, "each paycheck that stems from a discriminatory decision or pay structure is a tainted, independent employment action that commences the administrative statute of limitations." The court, however, ruled that Noel's failure to promote claim did fall within the "discrimination in compensation" claims sought to be addressed by the Ledbetter Act.  

The court reasoned that, based upon the plain and natural reading the Ledbetter Act, it did not apply to failure-to-promote claims. In particular, the court noted pay disparity and failure to promote claims are distinct causes of action because of the different proofs required for these types of claims. According to the court, a failure to promote claim falls within the class of discrete acts that are readily apparent because an individual knows when he or she has been hired, fired or promoted. In contrast, compensations decisions are often cloaked in secrecy and an employee may not know how much his or her co-workers earn. The Ledbetter Act sought to address only compensation decisions, which are often concealed and not discovered until long after the 300 day administrative period expires.

The decision helps to narrow the scope of Ledbetter Act claims and is a good reminder that true Ledbetter Act claims can be lurking for years.