Employment Law Daily Jury will decide if lawful for employer to pay female VP $40K less than male subordinate
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Thursday, April 14, 2016

Jury will decide if lawful for employer to pay female VP $40K less than male subordinate

By Dave Strausfeld, J.D. A female VP of Technical Services survived summary judgment on her Equal Pay Act and Title VII claims alleging she was unlawfully paid $40,000 less per year than a male expert in SharePoint software whom she supervised, held a federal magistrate judge in Alabama. Like the SharePoint expert, the VP had extensive experience working with SharePoint, and she also was in charge of managing over 40 employees (Woodard v. Medseek, Inc., April 8, 2016, Putnam, M.). VP of Technical Services. The woman executive was paid slightly under $120,000 as Vice President of Technical Services at a healthcare technology company. While overseeing the transition to software called SharePoint, she interviewed a SharePoint expert, who was male, and approved hiring him at a salary of $160,000 per year. Even though she recommended the hire and the salary, she had long felt that she was underpaid, and she had raised the subject with her supervisors several times, she said. In fact, the company’s COO allegedly admitted to her that she was being paid less than her male counterparts, presumably meaning other VPs; he promised to increase her salary but never did. Shortly after she returned from maternity leave, she was laid off in a reduction in force. She sued, asserting claims of pay discrimination as well as discriminatory discharge. Equal Pay Act prima facie case. On her EPA claim, the female VP needed to make a prima facie showing that she was paid less than males for substantially equal work. She offered direct evidence of this, the court found: the COO’s alleged admission to her that she was paid less than her male counterparts. In addition, the SharePoint expert was hired at a salary of $160,000 at a time when she was paid less than $120,000, even though she was a SharePoint expert too and he reported directly to her. A reasonable jury could find that the female VP and the SharePoint expert were sufficient comparators for purposes of the EPA, the court concluded, finding no need to resolve whether the other VPs would also have been proper comparators. Employer’s rebuttal. Because the female VP successfully made a prima facie showing that she was paid less for substantially equal work, the company bore the burden of establishing one of the EPA’s four statutory defenses. The company did not contend that the pay gap was attributable to a merit system or a seniority system or that it was measured by quantity or quality of production. Rather, the company asserted that its Chief Technology Officer believed the SharePoint expert was more effective and skillful than the female VP. But this defense was “not the type of specific showing of cause that is anticipated by the EPA,” the court explained. In particular, the company’s asserted reason was not legitimately “based on any factor other than sex” within the meaning of the EPA’s catch-all defense, the court indicated. Prior salary no justification. Also, it was no justification for the company to say it needed to pay the SharePoint expert a higher salary because his previous salary was high (and it thus took a higher salary to gain his acceptance of the job). As the Eleventh Circuit noted in Irby v. Bittick, “prior salary can never be used by an employer to establish pay,” because using a male’s prior high salary simply perpetuates the inequality that the EPA was enacted to rectify. Thus, the female VP survived summary judgment on her EPA claim. Title VII pay discrimination. With respect to her Title VII pay discrimination claim, the female VP needed to show that the company’s explanation for paying the SharePoint expert a higher salary was pretextual. According to the company, the SharePoint expert had a broader range of knowledge in SharePoint and also had good contacts within Microsoft. But this explanation of his extra $40,000 in salary appeared to be pretextual, the court found, because the female VP likewise had extensive experience working with SharePoint, and she was in charge of managing over 40 employees. There was also other evidence of pretext, including an upper manager’s allegedly overheard statement that he did not believe women deserved to be in positions such as hers. For these reasons, the female VP could proceed to trial on her Title VII pay discrimination claim too. Based on some of the same evidence, she also was allowed to move forward on her Title VII discriminatory discharge claim, held the court.

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