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Is This Retaliation?

Is This Retaliation?

by | Jan 19, 2022 | Retaliation

One question we face a lot in litigating retaliation claims is whether an employee has suffered “an adverse employment action.”  While deciding what kinds of things can be adverse employment actions seems like it should be easy, courts still struggle with it.

In a recent Eleventh Circuit case, Smith v. City of Pelham, the Eleventh Circuit explained how a supervisor’s action could be retaliatory—even when the employee did not initially know about it.

Here, Jennifer Smith filed a sex discrimination complaint against her supervisor. The City told the supervisor of the sex discrimination complaint and reminded him that the supervisor was not to retaliate against Smith.

Alas, that warning fell on deaf ears. Within a week, the supervisor tasked another employee with conducting a forensic search of Smith’s computer. The search turned up an iPhone backup on her work computer. In the photos in this backup, there were nude photographs. The investigation also showed that Smith had used her work computer during working hours for things related to a second job.

The City fired Smith because the nude photos in the iPhone backup on her work computer were considered “conduct unbecoming.”

Although Smith had no idea that the supervisor ordered this forensic search of her computer after filing her complaint, Smith knew that she had been fired within a month of filing her sex discrimination complaint. She sued for retaliation.

The Supreme Court tells us that retaliation exists when an employee suffers a materially adverse employment action. Retaliation is material if it might have dissuaded a reasonable worker from making or supporting a charge of discrimination.

The district court dismissed Smith’s retaliation claim. It reasoned that the forensic search could not be a materially adverse action because Smith did not know the supervisor had someone conduct the forensic investigation. The district court noted, “a reasonable worker could not be dissuaded from making a charge of discrimination due to an investigation of which she had no knowledge.”

Fortunately, the Eleventh Circuit recognized this for the illogical nonsense it is. It pointed out that to hold that an action cannot be adverse if the employee is unaware of that action is without legal support.

Smith was fired because of that forensic investigation—instigated by her supervisor immediately following her sex discrimination complaint. That search then caused her to be fired—and no one could dispute that the termination is an adverse employment action.

This outcome should have been common sense. Sadly, it was not. However, the Eleventh Circuit set the record straight here. It found that even though the search might have resulted in the discovery of some employee misconduct, that did not excuse that the investigation was itself retaliatory.

Retaliation continues to occur in all forms, shapes, and flavors. Most courts recognize it when they see it. Here, the Court of Appeals had to catch the district court’s error and set the record straight.

Equal Pay: The Rate of Pay

Equal Pay: The Rate of Pay

by | Dec 27, 2021 | Discrimination, Equal Pay

How do you measure equal pay?  Is it the employee’s base salary?  Or is it the employee’s total compensation?

A recent Fourth Circuit case, Sempowich v. Tactile Systems Technology, Inc., answered this question. In Sempowich, a female employee and her male peer were both paid a base salary and also earned commission income based on sales. The male employee was paid a higher base salary in 2015, 2016, and 2017 (even though he had less seniority and lower performance review scores). However, Ms. Sempowich’s total earnings in 2016 and 2017 were more than the male employee’s because she received more in sales commissions.

When she sued, the district court used her “total wages” as the metric for determining wage discrimination under the Equal Pay Act. Because Ms. Sempowich had earned more in total wages in those two years, the court dismissed her Equal Pay Act claim.

Ms. Sempowich appealed and argued that the proper measurement was the “rate” at which her employer paid her—the base salary.

The Fourth Circuit agreed—based on the text of the Equal Pay Act. The statute says an employer may not “discriminate … between employees on the basis of sex by paying wages to employees … at a rate less than the rate at which he pays wages to employees of the opposite sex.” 

This statutory language says nothing about “total wages.” Instead, it focuses on the wage rate. Here, Ms. Sempowich’s base salary was lower than her male peer’s base salary. So, she was paid at a rate lower than her male peer. Because of that, the Fourth Circuit found that the district court erred in dismissing her claim.

To drive home this conclusion, the Fourth Circuit used a hypothetical to demonstrate why total pay cannot be the proper point of comparison. Assume a company pays a woman $10 per hour and a man $20 per hour. If total wages is the measure of pay, the company would not violate the Equal Pay Act if the woman earned more than the male employee—even though she would have to work twice as many hours to do so. A woman should not have to work twice as many hours to make the same money.

That makes sense. A company cannot say it pays its employees equally if one employee has to work twice as many hours to make the same money. Likewise, that a female employee earned more in commissions than her male peer should not mean that her employer did not discriminate against her by paying her a base salary lower than her male peer.

This seems to be a common-sense conclusion. Unfortunately, it was not to a district judge in North Carolina. Fortunately, the Fourth Circuit caught and fixed this error.

Pay issues can be tricky, but the rate of pay is the starting point for any pay discrimination analysis—not total pay. It is good to have clarity on that point.

 

 

Fix the Problem The First Time

Fix the Problem The First Time

by | Oct 2, 2021 | Equal Pay, Pay Issues, Workplace Issues

When you know about a pay disparity, fix it before you get told by a court to fix it.

Too often, a company knows of pay disparities between male and female employees.  Yet, the company does not fix the pay disparities—usually arguing there is no money in the budget.

However, years of costly litigation to address pay discrimination may not be in the company’s budget either.

A recent Sixth Circuit case demonstrates the risk that a company takes in refusing to fix pay disparities.  In Briggs v. University of Cincinnati, 11 F.4th  498 (6th Cir. 2021), Lee Briggs, an African American male, was a Compensation Analyst.  The University later hired a Caucasian female as a Compensation Analyst.  Despite having no prior compensation experience, she was paid over $9,000 more than Briggs.

The Director of Compensation knew of the pay disparity but did not immediately correct it for budget reasons.

However, the Director of Compensation later asked the Chief Human Resources Officer for an equity adjustment to Briggs’ pay.  The CHRO’s response was only “we’ll see.”  In a follow-up meeting, she told him, “I’ll think about it.” Over two years later, nothing had been done to close the pay gap.

In a good reminder that men too can bring an Equal Pay Act claim, Briggs filed a Charge of Discrimination and sued under the Equal Pay Act and Title VII.     

The University defended its pay disparity for several reasons, including (1) the female demanded the higher salary as a condition of accepting the job and (2) that the female’s performance reviews were higher.

The Sixth Circuit made short shrift of the salary demand argument. It said:  “No authority supports the concept that an employee’s prior salary or demand for a specific salary is sufficient in isolation to justify a wage differential.  Such a rule would simply perpetuate existing sex-based pay disparities and undercut the purpose of the Act—to require that those doing the same work receive the same pay.”

As for the higher performance reviews, the court said the employer had to show it actually used the performance review scores in setting the pay.  Here, it did not. 

That argument was further undercut by the Director of Compensation testifying he knew there was a pay gap when he hired the female and hoped to close it when the budget permitted.

What is the moral of this story?  When you see a pay disparity, find the money to fix it.  Here, the $9,000 salary increase would have been far cheaper for the University than years of litigation. Plus the fact that litigation of this kind gets the attention of other employees and may lead to additional pay discrimination claims.

The Sixth Circuit reversed the grant of summary judgment and remanded Briggs’s case for trial. So the University is in for more expensive litigation.

Do the right thing the first time.  Fix the problem when you discover it.  The University of Cincinnati did not, and it is paying far more in litigations costs for that mistake than it would have taken to fix the pay disparity.

Stay tuned.

Equal Pay: Substantially equal ≠ identical

Equal Pay: Substantially equal ≠ identical

by | Apr 22, 2021 | Equal Pay, Uncategorized

Every pay discrimination case involves determining whether the jobs being compared are substantially equal.

The Ninth Circuit Court of Appeals recently reminded everyone that when it comes to determining equal pay, jobs could be substantially equal without being identical. The case is Freyd v. University of Oregon.  For Texas lawyers, note that the Hon. Kathleen Cardone, a United States District Judge for the Western District of Texas, sat by designation on the Ninth Circuit panel, issuing this opinion.

Here, Jennifer Freyd is a highly respected and well-known Professor of Psychology at the University of Oregon.  Freyd learned that she was paid thousands of dollars less each year than several male Professors of Psychology.  After requesting a retroactive raise and being denied it, Freyd sued under the Equal Pay Act, Title VII, and various Oregon state laws. 

After the District Court granted a summary judgment in part, the Ninth Circuit reversed it. The key issue on appeal was whether Freyd’s job as Professor was “substantially equal” to that of the other male Professors in the Psychology department.

 Freyd had to prove that the jobs being compared were “substantially equal.”  However, as the Ninth Circuit reminded us, “substantially equal” does not necessarily mean “identical.” 

Instead, the crucial finding on equal work is whether the jobs compared have a “common core of tasks.”  Once a plaintiff establishes there are a common core of tasks, then the court has to determine whether any additional tasks for one job but not the other is enough to make the two jobs substantially different.  That decision is made on a case-by-case basis.

 The Ninth Circuit reminds us it is the “overall job” and not its individual segments that must be compared.  Here, the Ninth Circuit found that a reasonable jury could conclude that Freyd and her male peers all shared the same “overall job.”  As full professors, they all conducted research, taught classes, advised students, and served on university committees, and performed other acts of service to the university. 

 Though there were differences because they did not teach the same courses, manage the same research centers or supervise the same doctoral students, the Ninth Circuit said that the jury must be the one to decide whether those differences make the professors’ jobs unequal.

The Ninth Circuit was critical of the “granularity” with which the District Court picked through the facts.  It said that such a granular approach guts the broad remedial purpose of the Equal Pay Act and strips it of the protections offered. 

It reminded us Congress wanted the Equal Pay Act to be broadly construed to accomplish the purpose of eliminating unequal pay between the sexes.

This opinion from the Ninth Circuit gives us a good roadmap on how to show that jobs are substantially equal.

But Your Husband Has A Job…

But Your Husband Has A Job…

by | Feb 18, 2021 | Discrimination, Equal Pay, Gender Discrimination, Pay Issues

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.