Over the last week, two unrelated stories caught my eye. For employers, they are a reminder that claims of pay inequality based on gender are still something to be concerned about.
The first story is that Governor Malloy announced plans for a new study to examine “factors that contribute to the gender wage gap in Connecticut’s workforce.”
The study will be run by new Connecticut Department of Labor Commissioner Sharon Palmer and Department of Economic Development Commissioner Catherine Smith. The Governor has asked the commissioners to make recommendations on the issue by October 2013.
I’ve talked about this issue before; there are some who believe that the wage gap is overstated. But the study will make headlines this year and this renewed focus in Connecticut on the issue should have employers revisiting their own practices.
The second story illustrates the claim in much more real world terms and shows the perils of trying to navigate your way through such claims.
In Morse v. Pratt & Whitney, decided last week, a federal court — among other issues — denied an employer’s motion for summary judgment on an Title VII unequal pay claim.
The facts of the case are complicated and a short blog post can’t begin to do it justice. But I’ll focus on one aspect: in 2008, the employer’s Compensation group performed a comprehensive analysis of employees’ salaries and made adjustments to 224 salaried employees, including the plaintiff. As a result, her salary was increased around 20 percent.
The plaintiff alleged that prior to this adjustment, her salary was considerably lower than a male counterpart. The court agreed but said that fact alone only showed that she was underpaid, not necessarily underpaid because of her gender.
What allowed the plaintiff, however, to get her complaint to a trial was her claims that her supervisors allegedly said that “‘girls’ who had husbands with jobs did not need to make as much money as men since men were the primary earners in the family” and that the company had a practice of denying female employees continuing education opportunities.
Because the court — on a motion for summary judgment — must take her account as true, it denied the employer’s motion and sent the case to a jury trial sometime later in 2013.
As noted above, the case illustrates the difficulty for employers where there are significant disparities in pay among employees. Even if the employer adjusts an employee’s salary unilaterally, it may still be held liable for its past actions.
What else can be done? For one, when making adjustments to an employee’s salary, an employer can make those changes retroactive to the statute of limitations time frame. It’s not a perfect solution by any means (and costly at that), but given the costs of litigation now, more money paid up front may minimize the amount spent going forward.
For employers in similar situations, though, be sure to consult with your own legal counsel at length to develop your own strategies to minimize the risks that such a change in pay will end up leading to a lawsuit.