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Can’t explain pay difference? That’s a problem

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in Discrimination and Harassment,Human Resources

Courts considering pay discrimination claims want to believe that employers don’t purposely adopt policies that pay men more than women for the same work. But employers won’t win many lawsuits if they can’t explain exactly how pay differences came about.

Simply put, if you have a complicated process for determining compensation, be ready to share it with the court.

Recent case: Texas Tech hired Satomi, a woman, as a tenure-track chemistry professor at the same time it hired a male chemistry professor. Their initial salaries were identical: $50,000 per year. Over the years, both scored similarly on yearly student evaluations. In fact, Satomi ranked slightly higher.

After the first year, the salary difference between Satomi and her male co-worker grew. By the sixth year, Satomi was earning $61,781, while the man made $65,811.

Then Satomi was turned down for tenure. She sued, alleging sex discrimination in pay under both the Lilly Ledbetter Fair Pay Act and the Equal Pay Act (EPA).

Texas Tech officials testified that the university used an individualized assessment based on an admittedly “complicated formula” to decide professors’ pay levels each year. However, no one from the university was able to provide an explanation of exactly how the salaries were computed.

The court was not impressed. While under the EPA, employers can justify pay differences between sexes with “any factor other than sex,” the court said that factor has to be explained.

The case will now go to trial. (Niwayama v. Texas Tech University, No. 13-11225, 5th Cir., 2014)

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