When confronted with allegations that salary levels discriminate on the basis of sex, employers often point to differences in education and experience as the basis for the wage variance. As pointed out by the Seventh Circuit Court of Appeals earlier this month, such arguments may explain differences in starting salaries, but they do not serve as a defense to claims that the gap in salaries continued despite equal work performance.
In King v. Acosta Sales and Marketing, the plaintiff alleged that she was paid one-third the salary of her male colleague despite the fact that her sales and overall work performance were comparable. In fact, all but one female salesperson in the organization were paid less than every other male employee in that position. The employer contended that the salary differences were based on the male employees' greater experience and higher levels of education.
The Seventh Circuit conceded that such factors could explain the differences in the employees' initial salaries, but failed to explain why the plaintiff's salary did not converge over time, despite comparable performance between her and her higher paid male colleagues. In Equal Pay Act cases, the employer bears the burden of proving the reasons for the pay disparity. A defense based on starting salaries established years earlier does not adequately explain these current differences, and the Seventh Circuit remanded the case for a jury trial on the actual reasons for the gap.
Employers should monitor salaries and salary differences among employees to determine whether the levels are based on demonstrable business reasons. As pointed out by this case, only the job performance and not hiring qualifications must be the criteria for explaining any continuing differences between employees.