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Equal Pay Act Claims and “A Factor Other Than Sex” – Past Salary Information

The en banc Ninth Circuit Court of Appeals has held that a female employee’s Equal Pay Act claim against her county-employer should be revived. Rizo v. Yovino, 950 F.3d 1217 (9th Cir. 2020). According to the majority, an employee’s prior wages are not “a factor other than sex” as required to defeat a prima facie case of an Equal Pay Act (EPA) violation.

Aileen Rizo relocated from Maricopa County, Arizona, to Fresno County, California, to work as a math consultant for the Fresno County Office of Education. Rizo had two master’s degrees and over a decade of experience when she was hired. To set Rizo’s pay, the County used the pay from her prior position as a starting point, then “increased the wages by 5% and placed [her] at the corresponding step on its pay schedule,” resulting in Rizo earning substantially less than all of her male colleagues, including those who were entry-level.

Rizo sued the County under the EPA. In response, the County argued it relied on a “factor other than sex,” Rizo’s pay history, to set her salary. The district court denied the County’s motion for summary judgment, and the Ninth Circuit reversed. However, when Rizo sought review by an en banc panel, the Court then affirmed the district court, allowing Rizo’s case to proceed. However, the en banc opinion was authored by Judge Stephen Reinhardt, who passed away before it was published. The County, through its Superintendent Jim Yovino, appealed the decision yet again, and the Supreme Court remanded the case for reconsideration.

On the case’s most recent trip to the Ninth Circuit, the Court kept to the position outlined by Judge Reinhardt and revived Rizo’s suit. The Court held that “factors other than sex” must be related to the job for which the person is being hired. Because pay history by definition relates to the prior job rather than the current one, it is not a job-related factor and therefore cannot defeat a prima facie claim of an EPA violation. According to the Court, an applicant is not required to demonstrated that her “prior wages were depressed as a result of sex discrimination” because of the history of “pervasive wage discrimination in the American workforce.” Furthermore, any prior pay is irrelevant because it is not “indicative of [an applicant’s] ability to perform the job she was hired to do.” However, several of the judges noted in the concurrence that “prior salary . . . may provide a lawful benchmark” in establishing current pay if it were to be one factor considered alongside others, such as education and training.

The Ninth Circuit’s opinion further crystallizes an ongoing circuit split regarding the “factor other than sex” defense. As the Court acknowledged, the Second, Fourth and Tenth Circuits have all held that “pay classification systems must be rooted in legitimate differences in responsibilities or qualifications for specific jobs.” Only the Seventh Circuit has explicitly stated that the “factor other than sex” defense “embraces an almost limitless number of factors, so long as they do not involve sex.”

This particular question merits clarification from the Supreme Court. In the meantime, employers may best be served by moving away from reliance on past salary information to set current salary. Although advances in pay equity remain on the rise, the fact that a “wage gap” remains provides for a variety of challenging considerations in this context. In addition, there appears to be increasing legislation prohibiting requests for information concerning past salary.

As is the case in so many employment-related issues, a variety of societal factors as well as public policy are to be taken into consideration in developing the best approach moving forward.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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