Wernsing v. Department of Human Services
427 F.3d 466 (7th Cir. 2005)
- The Department had a practice of paying lateral entrants a salary that was at least as much as they were earning at their old job, plus a raise, if possible.
- Jenny Wernsing was making $1,925 a month at her old job, and the Department gave her about a 30% raise to $2,478 a month as an “Internal Security Investigator II.”
- She argued that this practice discriminated against women.
(1) The Department lacked an “acceptable business reason” for its approach; and
(2) Because all pay systems discriminate on account of sex, any use of prior pay to set salary must be discriminatory.
- For example: Charles Bingaman, hired contemporaneously with Wernsing, had a prior salary of $3,399 a month. He received a monthly salary of $3,739 to start his new job, a 10% raise.
- Bingaman and Wernsing do the same work, under the same working conditions.
Does an employer’s practice of paying lateral transferees initial salary at least as much as salary they were earning in their old job, plus a raise if possible, discriminate on the basis of sex in violation of the Equal Pay Act?
- Section 206(d)(1) prohibits sex-based wage discrimination. However, 206(d)(1)(iv) exempts any pay differential “based on any other factor other than sex.”
- Here, wages at one’s prior employer are a “factor other than sex.”
- The court rejected Wernsing’s argument that the employer is required to show a “business reason” for the practice:
- The Equal Pay Act deals exclusively with disparate treatment; it does not have a disparate-impact component.
- The court also rejected Wernsing’s argument that market wages are all discriminatory and should be ignored (because women earn less than men from private employment):
- “That many women spend more years in child-rearing than do men thus implies that women’s market wages will be lower on average, but such a difference does not show discrimination.
Rule: An employee’s prior wages are a “factor other than sex” that could be used to set pay consistently with the Equal Pay Act.
Rule: The Equal Pay Act deals exclusively with disparate treatment; it does not have a disparate-impact component.
- Thus, an employer need not show “business necessity.”