Developments In Equal Pay Litigation - 2022 Update

© 2022 Seyfarth Shaw LLP Developments in Equal Pay Litigation | 9 payments made to an employee whether provided as base salary, bonus, or any other form of compensation. 60 In an appeal joined by the EEOC as amicus curiae , the Fourth Circuit disagreed, holding that the district court should have made its decision based on a comparison of base salaries. 61 According to the Fourth Circuit, “[t]he text of the Equal Pay Act unambiguously states that 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.’” 62 There was no need to consider the regulatory definition of “wages” because the statute clearly puts its emphasis on wage rates. But even so, the Fourth Circuit held that the district court had misinterpreted the definition: “The term ‘wages’ includes commissions because, just as with salary, an employer could not pay commissions to a female employee at a lower rate than a similarly situated male employee. This does not mean that all types of remuneration should be combined into one lump sum when comparing the earnings of a male and female employee.” 63 On the other hand, in the high-profile case, Morgan v. U.S. Soccer Federation, Inc. , 64 a group of professional women’s team players alleged that they were paid less than male professional soccer players employed by the same organization. The compensation for women’s team and men’s team players were determined by different collective bargaining agreements (“CBAs”). The women’s team players alleged that their CBA provided for lower bonuses than the men’s team. 65 The employer pointed to players’ total compensation, arguing that when compared on a cumulative and average per-game basis, the facts showed that the women’s team players were paid more in total compensation than the men’s team players. 66 The court found that the women’s team players’ focus on bonuses ignored the other benefits provided by their compensation arrangement, including guaranteed annual salaries and severance pay that the male players did not receive. 67 The court concluded that “[t]o consider these bonus provisions in isolation would run afoul of the EPA, which expressly defines ‘wages’ to include all forms of compensation, including fringe benefits.” 68 A plaintiff’s reliance on less clear-cut bases of compensation can create problems of proof that may result in dismissal. For example, in Williamson v. Digital Risk, LLC , 69 the court refused to dismiss some discrimination claims, including a claim under Title VII, because plaintiff had introduced direct evidence of intentional discrimination. 70 But with respect to her EPA claim, the court held that the plaintiff had failed to 60 Id. Plaintiff argued that including her incentive compensation would frustrate the purpose of the EPA because it would require “harder work for commissioned employees with lower base salaries to achieve equal pay.” Id. The court rejected that argument, holding that the EEOC’s definition of wages comports with the text of the EPA and Supreme Court and Fourth Circuit precedent. Id. at *23-24. 61 Sempowich v. Tactile Sys. Tech., Inc. , 19 F.4th 643 (4th Cir. 2021). 62 Id. at 655 (quoting 29 U.S.C. § 206(d)(1)) (emphasis in original). 63 Id. 64 Morgan v. U.S. Soccer Fed’n, Inc. , 445 F. Supp. 3d 635 (C.D. Cal. 2020). 65 Id. at 652. 66 Id. at 653. 67 Id. at 654. 68 Id. (citing 29 C.F.R. § 1620.12(a); 29 C.F.R. § 1620.11(a)). The Court also rejected plaintiffs’ reliance on an analysis of what they might have been paid if they had been compensated under the same terms as the men players’ CBA. “This approach—merely comparing what each team would have made under the other team's CBA—is untenable in this case because it ignores the reality that the [men players] and [women players] bargained for different agreements which reflect different preferences, and that the [women players] explicitly rejected the terms they now seek to retroactively impose on themselves.” Id. at 655. The court found that the history of negotiations between the women players and their employer showed that they had rejected an offer to be paid under similar terms as the men’s team and instead opted for different terms that provided benefits to the women players that were difficult to value: “One of the defining features of the [women players’] CBA is its guarantee that players will be compensated regardless of whether they play a match or not. This stands in stark contrast to the [male players’] CBA, under which players are only compensated if they are called into camp to play and then participate in a match. It is difficult to attach a dollar value to this ‘insurance’ benefit, and neither party attempts to do so here.” Id. 69 Williamson v. Digital Risk, LLC , No. 6:18-cv-767-Orl-31EJK, 2020 WL 434954 (M.D. Fla. Jan. 28, 2020). In that case, a female senior operations manager alleged a variety of intentional discrimination claims, including sex harassment, along with a wage discrimination claim under the EPA. 70 Id. at *4 (“[A]ccording to the Plaintiff’s sworn declaration, [plaintiff’s supervisor] directly told her that he was taking away her accounts because leadership believed ‘she was making too much money as a female.’”).