Developments In Equal Pay Litigation - 2022 Update

© 2022 Seyfarth Shaw LLP Developments in Equal Pay Litigation | 25 For example, in O’Reilly v. Daugherty Systems, Inc. , 191 the District Court for the Eastern District of Missouri conditionally certified a collective action of female consultants and support staff of an information technology consulting services company who complained that they were paid less than similarly situated male employees performing equal work. Plaintiffs had presented the court with two declarations that alleged that the employer used a centralized decision-making process to set compensation for all employees, regardless of job title, salary grade, or geographic location. They had also presented an employee handbook and limited compensation data that showed that male employees were the top earners in some or all departments in the St. Louis, Atlanta, Minneapolis, Dallas, and Chicago branches. 192 On the strength of that evidence, the court concluded that the plaintiffs had met their burden of providing “substantial allegations” that the employer “had a single decision, policy, or plan to pay female employees less than male employees doing the same work.” 193 The court later decertified the collective action after discovery revealed that the employees who opted into the case lacked the similarity necessary to proceed to trial as a collective action. 194 The court found that the evidence “does not support the existence of a single, FLSA-violating policy because [employer] did not impose a top-down compensation structure; rather, compensation decisions occurred at the branch level.” 195 Although the employer’s corporate leadership was involved in approving total salary adjustments for each branch, individual compensation decisions were the result of a collaboration between local branch managers and the employee's supervisors: “supervisors provide compensation recommendations to the branch managers, who can then approve the recommendation without corporate approval.” 196 This lack of a “top-down” policy for setting compensation was fatal to the plaintiffs’ attempt to proceed collectively because, without that, the alleged violations of law were too varied to form the basis of a collective action: “Plaintiffs’ compensation was determined by their supervisors in consultation with their branch managers, and the composition of the compensation depended on their department code, role, and title, which resulted in some plaintiffs receiving incentive bonuses while others could not. Thus, any purported compensation policy affected plaintiffs differently depending on role, title, location, etc.” 197 Even within a single establishment, a compensation policy that is particularized with respect to each collective action member can defeat certification, because each plaintiff’s claims would rest on their particular circumstances, rather than one overarching unlawful policy. For example, in Bertroche v. Mercy Physician Associates, Inc. , 198 the court granted the employer’s motion to decertify the collective action. Discovery revealed that the employer’s compensation scheme was designed to account for each physician plaintiff’s different medical and business decisions, which would result in different total compensation amounts, and so plaintiffs and opt-ins could not be similarly situated to each other for purposes of proceeding as a certified collective action. 199 191 O’Reilly v. Daugherty Sys., Inc. , No. 4:18-cv-01283 SRC, 2020 WL 1557174 (E.D. Mo. Mar. 31, 2020). 192 Id. at *2-3. 193 Id. at *3. 194 O’Reilly v. Daugherty Sys., Inc. , No. 4:18-cv-01283 SRC, 2021 WL 4514293 (E.D. Mo. Sept. 30, 2021). 195 Id. at *7. 196 Id. 197 Id. 198 Bertroche v. Mercy Physician Assocs., Inc. , No. 18-cv-59-CJW-KEM, 2019 WL 4307127 (N.D. Iowa Sept. 11, 2019). In that case, a female physician alleged systemic wage discrimination against female family practice physicians. The court ordered the parties to prepare data compilations showing the average compensation for male physicians versus female physicians. The court had initially granted conditional certification, holding that the plaintiff was not required to show at that stage that the wage disparity was due to discrimination, nor that other potential plaintiffs are “similarly situated.” Rather, it was enough merely to show that other potential plaintiffs exist who may have been discriminated against based on their gender, which defendants’ own data showed. Bertroche v. Mercy Physician Assocs., Inc. , No. 18-cv-59-CJW, 2018 WL 4107909, at *3 (N.D. Iowa Aug. 29, 2018). 199 Bertroche , 2019 WL 4307127, at *25. The district court held that, “the different ways in which physicians operate their medical practices can serve to differentiate them from one another such that they should not be able to proceed collectively,” id at *26 (quoting Ahad v. Bd. of Trs. of S. Ill. Univ. , No. 15-cv-3308, 2019 WL 1433753, at *4 (C.D. Ill. Mar. 28, 2019)), and that the dissimilarities among plaintiff’s medical practices weighed in favor of decertifying the collective action: “because the compensation scheme looks at the specific factual situation of each physicians’ practice, pursuing this avenue would require each plaintiff to present evidence that is specific to her medical practice,” id at *28.