For those of you who have not been following developments in Equal Pay Act cases as closely as I have, the ruling late last year in the Allen v. Staples, Inc. case changes the way a lot of these cases are being litigated as the court allowed the Plaintiff in Allen to defeat summary judgment by showing that a single male comparator was paid more than the plaintiff (even when other male comparators were not), and essentially shifted the burden to employers to disprove Equal Pay Act claims.
In Allen, Joyce Allen, a former employee of Staples, filed a lawsuit against the company for allegedly violating California’s Equal Pay Act, gender discrimination, and sexual harassment. Allen claimed that she was paid less than her male counterparts who performed substantially similar work. The trial court had granted summary judgment in favor of Staples, but Allen appealed to the California Court of Appeal.
The California Court of Appeal reversed the summary judgment in favor of Staples on Allen’s Equal Pay Act claim. The Court held that Allen established a prima facie case by showing that she was paid less than a single male comparator in substantially similar work under similar conditions. Staples attempted to argue that the wage disparity was based on time with the company and overall experience. However, the Court found that Staples did not provide specific factors that caused the pay differences between Allen and the male employees who were paid more and merely provided general evidence. As a result, Staples failed to carry its burden and the Court of Appeal reversed the summary judgment with regard to the Equal Pay Act Claim.
The Court of Appeal also analyzed Allen’s argument under the McDonnell Douglas burden-shifting framework for her FEHA sex discrimination claim. The Court found that Allen could not link her lower pay to any act of alleged sex discrimination and that Staples’ evidence showed that female Area Sales Managers (“ASM”) were paid more on average than male ASMs, and some male ASMs and Field Sales Directors were paid lower salaries than Allen. Thus, the Court affirmed the trial court’s grant of summary judgment on the FEHA sex discrimination claim.
The Appeals Court decision in Allen demonstrates the Court’s willingness to shift burdens in these cases in order to protect California employees’ rights to equal pay for equal work. Employers must ensure that they have a bona fide non-sex-related reason for any wage disparities and that they can provide specific factors that caused the pay differences between employees. This decision highlights the importance of evidence in cases alleging wage discrimination and the need for employers to document the legitimate bases for pay decisions and implement pay practices and procedures that are based on bona fide factors other than sex to prevent Equal Pay Act claims. Overall, this decision sets a precedent that will likely influence future cases on equal pay and sex discrimination claims in California.