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Ninth Circuit Reverses Itself on Equal Pay Act

Just a year ago, the Ninth Circuit Court of Appeals held that a salary differential based on prior earnings history was not a violation the Equal Pay Act (EPA). However, in its recent en banc review, the circuit court now finds that an applicant’s salary history may not be used to justify paying one employee more than an employee of the opposite sex doing comparable work.
The decision arises out of the same case presented a year ago. Aileen Rizo was a math consultant for the Fresno School District. She was paid less than all of the male math consultants. The school district argued that its decision was based solely on Ms. Rizo’s prior salary history, and not her gender. The Equal Pay Act allows for employers to demonstrate by an affirmative defense that its pay decisions were based “a differential based on any other factor other than sex.”
A review of the issue by the entire Ninth Circuit Court of Appeals led it to reverse its prior decision. Under the Equal Pay Act, the court determined that a “factor other than sex” must be limited to “job-related factors.” According to the Ninth Circuit, an employee’s salary history was not “a legitimate measure of work experience, ability, performance, or any other job-related quality.” The circuit court noted that accepting the school district’s argument that it should be able to rely on salary history would serve to “perpetuate rather than eliminate” the type of discrimination that the EPA was intended to eradicate.