56 | Developments in Equal Pay Litigation ©2024 Seyfarth Shaw LLP Similarly, in McKinley v. United Parcel Service Inc.,448 the employer argued that pay differentials were justified because it had paid plaintiff within the pay bands applicable to her positions. But plaintiff tried to recast this as a defense based on her prior wages, noting that “the Seventh Circuit has held that basing pay on prior wages could be discriminatory if sex discrimination led to the lower prior wages.”449 She pointed to an alleged sexist comment made by a former manager in 1994 that she “chose a family over a career,” and the fact that she was not promoted for eighteen years. But the court found that she had not provided sufficient evidence to show that her past wages were a result of sex discrimination: “The evidence submitted by [employer] supports that it closely followed its pay band structure to determine compensation for its employment positions,” that “[plaintiff] was given raises in-line with the [employer] pay band for Part-Time Supervisors and that upon being promoted to a Specialist, her hourly pay rate increased to be consistent with the Specialist pay band,” and that “[employer] paid [plaintiff] at the top of the pay band for her position before she was promoted to a Specialist.”450 Relying on Lauderdale, the court concluded that the employer’s use of pay bands was a legitimate neutral factor accounting for the pay disparity because plaintiff was paid according to the pay band of her current and prior positions.451 Other courts have rejected Rizo on more prudential grounds, reasoning that a higher prior salary could reflect, in some instances, that an applicant is bringing more experience and skills to the position. For example, in Smith v. IVM Solutions, L.L.C.,452 a female parts manager for a roadway herbicide application provider alleged she was paid less than a male parts manager.453 However, the court found that plaintiff’s comparator’s higher pay was justified by a combination of his experience and his prior pay. In particular, the court found that the employer valued his knowledge of the exact same parts that he would oversee as parts manager, due to his years of experience in the “niche market” of herbicide application.454 Moreover, his hourly pay rate prior to becoming a parts manager was higher than plaintiff’s due to the financial incentive offer he received to induce him to leave his former employer.455 The plaintiff attempted to establish that the employer’s reasons were merely a pretext for discrimination, arguing that the employer was not well aware of her experience prior to being hired. But the court found this failed to show discriminatory intent: “disputing whether [employer] knew the specifics of [plaintiff’s] prior work history when determining her pay as parts manager does not give rise to an inference of pretext, especially when nothing in the record suggests [employer] was motivated by discriminatory animus.”456 employer’s affirmative defense that was based on prior salary. See also McGee v. Va. Dep’t of Envtl. Quality, 624 F. Supp. 3d 616, 632 (E.D. Va. 2022) (noting that “[t]his Court has previously held that employers may raise prior salary as an affirmative defense in EPA cases as a ‘factor other than sex,’ and holding that defense was met where plaintiff’s comparator’s salary was set because the employer, “knew that his private sector job probably paid more,” and even raised its initial offer after his prior employer offered a salary increase to entice him to stay). 448 McKinley v. United Parcel Serv. Inc., No. 1:19-cv-2548-TWP-DLP, 2021 WL 4477830 (S.D. Ind. Sept. 30, 2021). 449 Id. (internal quotations omitted). 450 Id. at *16. 451 Id. Some courts have allowed prior salary history to be considered in connection with theories of “salary compression,” i.e., a pay discrepancy that is the result of later-hired employees starting at a higher salary, which widens over time as a result of regularly scheduled percentage pay increases. See, e.g., Kellogg v. Ball State Univ., No. 1:18-cv-2564-TAB-TWP, 2020 WL 707846, at *2-3 (S.D. Ind. Feb. 12, 2020) (holding that the Seventh Circuit allowed theories of “salary compression” as a justification for wage disparities, pointing to the Seventh Circuit’s reasoning contrary to Rizo, and finding that employer’s reliance on salary compression qualifies as a factor other than sex that “comports with current Seventh Circuit precedent”), rev’d on other grounds, 984 F.3d 525 (2021); Stice v. City of Tulsa, No. 17-cv-261-CVE-FHM, 2018 WL 3318894, at *2-5 (N.D. Okla. July 5, 2018) (holding that “salary compression” could be a factor other than sex—explaining that a system of percentage-based salary increases provides a nondiscriminatory explanation for the differences in pay—and holding that neither Rizo, nor the Tenth Circuit has held that the use of prior salary history can never be a consideration to justify a pay disparity, just that it cannot be the only consideration, but ultimately rejecting employer’s motion for summary judgment because that explanation was “not so convincing that any rational jury would find in favor of defendant on plaintiff’s EPA claim”) (citing and quoting Angove v. Williams–Sonoma, Inc., 70 F. App’x 500, 508 (10th Cir. July 8, 2003)). 452 Smith v. IVM Solutions, L.L.C., No. 1:21-cv-162-RAH, 2022 WL 16701100 (M.D. Ala. Nov. 3, 2022). 453 Id. at *3-4. 454 Id. at *5. 455 Id. 456 Id. See also Thomas v. Gray Transp., Inc., No. 17-cv-2052-KEM, 2018 WL 6531661, at *7 (N.D. Iowa Dec. 12, 2018) (holding that male dispatcher who had worked for the company as a driver manager and had kept his previous salary when he became a dispatcher meant that the comparator’s “prior work (and salary) for [employer] establish that his higher salary was based on a factor
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