Worn rotors develop a raised lip of unworn metal at the outer edge, and it can get in the way when you fit new pads. Here is whether you have to remove the rotor lip.
Why the lip forms
The pad does not reach all the way to the rotor's outer edge, so that ring of metal never wears down while the contact area does - leaving a raised lip; see rotor lip edge. A big lip means the rotor is well worn; see rotor thickness.
Why it can block new pads
New pads are thicker than the worn ones you removed, and the caliper piston must be pushed all the way back to fit them. A large lip can catch the new pad or make it hard to slide the caliper over; see new pad won't fit.
Usually the answer is replace the rotor
If the lip is big enough to matter, the rotor is worn - the right fix is usually to replace (or resurface) the rotor rather than grind the lip off; see resurface vs replace. Fresh pads belong on a fresh surface anyway.
What to do
Measure the rotor - if it is near minimum or has a heavy lip, replace it in an axle pair; if it is still in spec with a tiny lip, new pads usually seat fine. Fit quality pads and hardware.