The Ninth Circuit in its en banc decision Rizo v. Yovino, 950 F.3d 1217 (9th Cir. 2020) held that employers cannot use an employee’s prior pay as a “factor other than sex” as a defense to gender-based pay disparities under the federal Equal Pay Act.
The Equal Pay Act (“EPA”) prohibits paying an employee at “a rate less than the rate at which [the employer] pays wages to employees of the opposite sex … for equal work on jobs the performance of which requires equal skill, effort, and responsibility.” Employers may defend an Equal Pay Act claim by demonstrating that the pay disparity is “pursuant to (i) a seniority system; (ii) a merit system; (iii) a system which measures earnings by quantity or quality of production; or (iv) a differential based on any other factor other than sex.”
In Rizo v. Yovino, a teacher brought a claim under the EPA against the Fresno school district for paying her substantially less than all her male colleagues, even though she had more experience and education. The school district did not dispute that she was paid less than her male colleagues. Rather, the district argued that Rizo’s salary was based on her past salary and therefore qualifies as a “factor other than sex” under the EPA.
The Ninth Circuit held that “any other factor other than sex” under the EPA is limited to job-related factors only. According to the court, prior pay is not related to Rizo’s current job, and not a factor other than sex for EPA purposes. Notably, the court took the position that allowing prior pay to serve as a job-related factor to justify gender-based pay differentials would perpetuate these disparities given “the history of pervasive wage discrimination in the American workforce.”
By contrast, the Seventh and Eighth Circuits, as well as the EEOC, have taken the approach that prior pay is an appropriate consideration, among other factors. In California, however, the California Equal Pay Act prohibits prior pay to justify any sex, as well as race, pay differentials.
The school district filed a petition for writ of certiorari with the Supreme Court on March 24, 2020. Given the circuit split, the case is ripe for the Supreme Court’s review and could have far reaching implications for sex-based wage discrimination claims.