For decades, companies paid female employees less because “her husband has a job” or because a male coworker “has a family to support.” Finally, a court called this pay practice what it is: blatant discrimination.
In Kellogg v. Ball State University d/b/a Indiana Academy for Science, Mathematics, and Humanities, Cheryl Kellogg was hired to be a teacher. The hiring director told her that she “didn’t need any more [starting salary] because he knew her husband worked.” Kellogg suffered the effects of this “outdated and improper approach” to her starting salary for the next 12 years.
When Kellogg finally sued for pay discrimination under Title VII and the Equal Pay Act, the Academy said that the pay differential was not discriminatory. Instead, it claimed Kellogg’s lower pay was because of (1) salary compression (paying newer hires more) and (2) difference in Kellogg and the male coworkers’ qualifications.
In granting a motion for summary judgment, the district court ruled these two reasons were “undisputed” gender-neutral explanations for the salary disparity.
On appeal, Seventh Circuit said that the Academy “blatantly discriminated against Kellogg by telling her that, because her husband worked, she did not need more starting pay.” Such clear discrimination calls the sincerity of the Academy’s rationales into question.” It then reversed and remanded the case.
This sharp rebuke was well deserved.
The district court erred in two significant ways. First, it did not consider the statement that Kellogg did not need more pay because her husband worked. It characterized that statement as a “stray remark.” The Seventh Circuit quickly dismissed that argument, noting that this statement “was not water cooler talk.” Instead, it was a straightforward explanation by the Academy’s director, who had control over setting salaries, as to why Kellogg did not need more money. As it said, “few statements could more directly reveal the Academy’s motivations.”
Second, the district court did not consider the discriminatory statement because it had been made outside of the statute of limitations period. The Court of Appeals reminded that under the paycheck accrual role, as codified by the Lilly Ledbetter Fair Pay Act of 2009, a new cause of action for pay discrimination arises each time a plaintiff gets a paycheck resulting from an earlier discriminatory compensation practice—even one that occurred outside of the statute of limitations.
And, even apart from the paycheck accrual rule, it held Kellogg could rely on the statement’s to show that the Academy’s explanation for the pay disparity is pretextual because “time-barred acts [are allowed] as support for a timeline claim.”
Because the blatantly discriminatory statement that Kellogg did not need more pay because her husband worked put the Academy’s stated reasons for the pay different in dispute, the Seventh Circuit remanded this case.
That companies still make decisions about what to pay female employees based on a perception of whether a woman “needs” the money “because her husband works” or because her male coworker has a “family to support” is disheartening.
Let’s hope employers start to recognize this for what it is: blatant discrimination.