Company’s Actions After Unequal Pay Claim Constitute ‘Don’t’ Checklist

By Maria Greco Danaher Jul 26, 2017
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​Complaints of unequal pay should not be taken lightly and certainly should not be met with an adverse employment action. The 8th U.S. Circuit Court of Appeals recently reinstated a female office worker's retaliation claim that had been dismissed by a federal district court and is allowing that case to move forward to a jury.

Shana Donathan, an employee of Oakley Grain Inc. with no prior poor reviews or prior discipline complained of unequal pay.

[SHRM members-only toolkit: Managing Pay Equity]

Eight days later, she was laid off, along with three seasonal workers. Another individual was fired at the same time for documented performance issues. Four days later—the first workday after the firings—the three seasonal workers were rehired, and a replacement for Donathan was hired, as well. Her replacement did not possess similar experience.

Donathan filed an Equal Employment Opportunity Commission charge and, ultimately, a federal court lawsuit that included a retaliation claim under the Equal Pay Act and Title VII of the Civil Rights Act of 1964.

The district court dismissed the claims in response to a motion for summary judgment by the employer. Donathan appealed to the 8th Circuit, which reversed the dismissal of the retaliation claim.

A plaintiff's ultimate burden in a Title VII retaliation case is to prove that an impermissible retaliatory motive was the "but-for" cause of the adverse employment action, which is a relatively high bar—higher  than simply having to prove that the protected activity of the plaintiff was one of the "motivating factors" of the firing. But in this case, the court held that Donathan's case should be decided by a jury for the following reasons:

  • The business reason provided by the company for Donathan's layoff was "economic necessity tied to a seasonal downturn" in business, but her office position had not been included in seasonal layoffs in the previous years during which she had worked for the company.
  • Donathan had no prior negative reviews or disciplinary actions.
  • A replacement was hired by the next workday.
  • The temporal proximity between Donathan's complaint of pay inequality and her layoff was "strong evidence" of retaliation. (There was evidence of a phone call between managers regarding layoffs just after, and on the same day as, Donathan's complaint, and the layoffs occurred eight days later.)

This case is a checklist of "don't" actions for employers. First, and importantly, there was no factually supported business-related reason for Donathan's termination. She was a successful employee without prior discipline or negative evaluations, and her office position had not been included in seasonal layoffs before that time. Next, the business rationale given by the company (seasonal slowdown) was immediately clouded by the fact that the three seasonal workers laid off with Donathan were rehired on the next business day. Finally, at the same time that it brought back the three seasonal workers, the company hired an individual whose qualifications were measurably lower than Donathan's rather than rehire Donathan, again weakening its "legitimate business reason" for the termination.

While the dissent in this case suggests that "the majority opinion is a victory for inferring retaliatory intent from temporal proximity," such characterization overlooks the fact that temporal proximity was only one of the number of factors on which the court's decision was based.

Donathan v. Oakley Grain Inc., 8th Cir., No. 15-3508 (June 28, 2017).

Professional Pointer: Employers should recognize that thoughtful and careful consideration and investigation of an employee's claim of unequal pay can avoid a retaliation claim and the attendant legal action that most certainly will accompany it. In this case, there was no documented discussion, investigation or consideration of Donathan's issues prior to her termination and replacement.
Maria Greco Danaher is an attorney with Ogletree Deakins in Pittsburgh.

 

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