Employment Law Report
Is It Time for an Internal Audit to See if Your Company’s Compensation is in Compliance with the Law? What We Can Learn From the U.S. Women’s Soccer Team Suit
This month, five members of the U.S. Women’s National Soccer team filed a wage disparity complaint with the EEOC against the U.S. Soccer Federation. The Women’s team alleges that despite the fact that they are doing equal work, they are not receiving equal pay as the Men’s National Soccer Team. The Women’s team alleges their top-tier players earn between 38% and 72% of their male counterparts, although the Women’s Team is more successful. One article noted that in 2015, they were paid far less for winning the tournament than the men were paid to lose their tournament. The EEOC will investigate the complaint and then make a decision as to the validity of the women’s claims.
The EEOC has jurisdiction over claims alleging discrimination in pay under the Equal Pay Act of 1963, Title VII, ADEA, and ADA. The EPA requires that men and women be given equal pay for equal work. In order for jobs to be considered equal, they must be substantially equal. In order to make this assessment, the EEOC looks to content of the job, and whether there is substantially equal skill, effort and responsibility and whether the jobs are performed under similar working conditions.
Although that analysis is through the Equal Pay Act, the EEOC provided other examples of pay disparity under other laws:
An employer pays an employee with a disability less than similarly situated employees without disabilities and the employer’s explanation (if any) does not satisfactorily account for the differential.
An employer sets the compensation for jobs predominately held by, for example, women or African-Americans below that suggested by the employer’s job evaluation study, while the pay for jobs predominately held by men or whites is consistent with the level suggested by the job evaluation study.
An employer maintains a neutral compensation policy or practice that has an adverse impact on employees in a protected class and cannot be justified as job-related and consistent with business necessity. For example, if an employer provides extra compensation to employees who are the “head of household,” i.e., married with dependents and the primary financial contributor to the household, the practice may have an unlawful disparate impact on women.
Pay disparity has been a top focus of the EEOC for some time. There have been several recent settlements, including with Gilbert Foods/Hearn-Kirkwood, who was required to pay $63,500 in back pay, compensatory damages and attorney’s fees to a female employee who claimed that a newly hired male in the same position made significantly more than her per hour. Also, the EEOC settled with NFI Roadrail, who agreed to pay $45,000 to settle a claim that a female director was paid less than three other male directors.
Earlier this year, as we previously reported, the EEOC proposed that pay data be placed on the EEO-1 form. The EEOC proposes to share this data with other federal agencies as well. If the proposed form is adopted, and once that data is available, the EEOC will be scrutinizing the data to see if there are disparities in pay.
What can companies learn from this high profile case? Before pay data will be available for the EEOC to scrutinize, it is wise to do an internal audit in order to ensure that your company is paying employees in accordance with the EPA, Title VII, the ADEA and the ADA. An attorney can review your pay data and the job responsibilities of your employees to determine if there may be potential issues.
Equal Pay Act statistics are available here.