Pay Equity – What’s Good for the Gander is Good for the Goose?

By Elizabeth Torphy-Donzella - Shawe Rosenthal LLP

January 20, 2022

Determining pay based on gender is wrong. It’s also pernicious. The domino effect of an inappropriately depressed starting wage can impact pay for one’s lifetime. It’s also illegal under Federal and State anti-discrimination laws; pay decisions must be based on the job, not protected characteristics, including a person’s gender. Beyond these laws, which often address alleged violations after-the-fact, pay equity increasingly is being dealt with by State laws prohibiting inquiries about past salary and/or that require employers to provide applicants with salary ranges for the job they are seeking. The goal is to head off discrimination and stop the dominos from tumbling toward a lifetime of depressed wages. All of these laws are premised on the statistics that show women earn roughly 83 % of wages earned by men.

So, what’s up with the EEOC’s lawsuit (filed against the Maryland State Department of Transportation State Highway Administration no less) alleging that a MALE was paid less than his FEMALE counterparts for performing the same job?  The suit alleges that the male, hired in 2007, earned thousands less than subsequently hired females performing the same role within his own district of the MDOT SHA and other districts. It further alleges that “[a]dditional female successors eventually occupied [the male’s] former position, all paid by MDOT SHA thousands of dollars more than what it paid to [the male].”

I think the EEOC likes to target pay disparities at government agencies because pay ranges and rates are established by personnel rules and it’s therefore easier to prove incumbents are performing the same or similar jobs (proof required to state a violation). The “win” can help establish precedent for later cases.

Of course, allegations are just that. An employer may not base pay decisions on gender (even to favor females over males) but is allowed to base them on seniority, a merit pay system, quality or quantity of work, or a differential based on any factor other than sex. Pay history may be a “factor other than sex” but it is not one that is justified legally (or so we may gather from the U.S. Supreme Court’s decision to deny review of an appeals court decision so holding).

We will be interested to learn what the MDOT SHA offers by way of defenses in the litigation (assuming the parties do not settle along the way). Was the male an underperformer relative to the females or a can’t do person compared to the women in the same role?  Was there some other factor (other than sex) at play?

However the case turns out, employers take heed. Disparate pay “based on sex” cannot be imposed on any persons of any sex. Ensure that pay is based on the job, not merely the identity of the person in the job (and for goodness sake, make sure that performance is honestly evaluated if you hope to rely on performance as your basis for differentials in pay).

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