Ninth Circuit Rules Equal Pay Act Bans Any Consideration of a Candidate’s Prior Compensation in Setting Wage Differentials 4-11-18

Bruce’s Summary: The Equal Pay Act, a federal law aimed at abolishing wage disparity between men and women has been in place since 1963. Let me say that again, 1963. On April 9, 2018 the Ninth Circuit Court of Appeals issued a decision that an employer may not consider a candidate’s prior compensation when establishing prospective salary and wages.
The Equal Pay Act requires that men and women may not be paid differently for equal work. The authors review the exceptions in the act and the particular exception the court focused on being, “a differential based on any other factor other than sex.” The authors indicated that the court’s decision and new holding that a candidate’s prior compensation may not be considered as a factor under this “catchall” category.
The authors further indicate that the court’s decision, “not only bans an employer from basing wages on the candidate’s prior compensation, it stretches further in holding that, in the Ninth Circuit at least, such information cannot even be considered as one of a combination of factors in justifying wage differentials between male and female employees.”
The authors close with reminding the audience to not forget that, “the Equal Pay Act is a ‘strict liability’ law and that employers will be held liable even if they had no intention of discriminating against an employee.” “None of the information contained herein should be construed as legal advice, nor are Calvin Associates consultants engaged to offer legal advice. If there is a need for legal advice, please contact and seek the advice of independent legal counsel.”

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