Dated Salary Explanation Can Support Equal Pay Act Claim

By Jeffrey Rhodes January 20, 2021
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A comment by a hiring manager, despite being made 12 years prior, that an employee did not need a higher starting salary because "her husband worked" can support pay-discrimination claims, the 7th U.S. Circuit Court of Appeals held.

The Indiana Academy for Science, Mathematics and Humanities is a residential high school on the campus of Ball State University. The academy hired the plaintiff in 2006 as a life science teacher. Her starting salary was $32,000.

The plaintiff negotiated this figure with the academy's executive co-director. According to the plaintiff, the executive co-director told her during those negotiations that he would not pay her a higher salary, because then she would be making as much as his Ph.D. instructors. He offhandedly told her that she did not need any more money because he knew her husband worked at Ball State, so they would have a "fine salary."

Many years later in 2017, the plaintiff complained to the dean of Ball State's Teacher's College, which oversees the academy, that she received less pay than her similarly situated male colleagues. The dean responded that the issue was salary compression, which means those who were hired after the plaintiff was hired began at a higher salary. The dean also noted that the plaintiff's salary increased by 36.45 percent during her time at the academy, while her colleagues' salaries increased by less.

The plaintiff sued the academy in 2018 for violating Title VII of the Civil Rights Act of 1964 and the Equal Pay Act (EPA) by engaging in sex-based pay discrimination. The academy moved for summary judgment on both claims. The district court granted the motion, because the academy provided what the court believed were undisputed gender-neutral explanations—such as salary compression and qualification differences—for any discrepancy between the plaintiff's salary and those of her colleagues.

In reaching this conclusion, the court found that, while the hiring manager's statement about the plaintiff's husband was admissible for purposes of providing background information on the factual circumstances, it could not establish liability, as this allegation fell well outside the statute of limitations.

On appeal, the 7th Circuit reasoned that, under the Lilly Ledbetter Fair Pay Act of 2009, the hiring manager's statement could establish liability.

In addition, the court found that the academy blatantly discriminated against the plaintiff by telling her that because her husband worked, she did not need any more starting pay. This clear discrimination called into question the sincerity of the academy's legitimate, nondiscriminatory reasons for its pay decisions.

The 7th Circuit further held that the plaintiff could use the 12-year-old statement to support her claims under both Title VII and the EPA.

The appeals court instructed the district court to allow the plaintiff to include other comparators in her pay-discrimination analysis, even though the plaintiff had focused only on one male comparator in the litigation. Her complaint referenced other possible comparators, and the academy referenced other male employees in justifying her pay, thus allowing her to supplement her evidence.

The 7th Circuit thus overturned the district court's grant of summary judgment and sent back the case for further proceedings.

Kellogg v. Ball State University d/b/a Indiana Academy for Science, Mathematics and Humanities, 7th Cir., No. 20-1406 (Jan. 5, 2021).

Professional Pointer: Employers should re-examine their prior pay practices and seek to make changes if they find a potentially discriminatory basis for earlier salary decisions. Even dated salary decisions can support current-day pay-discrimination claims.

Jeffrey Rhodes is an attorney with McInroy, Rigby & Rhodes LLP in Arlington, Va.

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