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Court Ruling on Salary History Could Minimize Gender Disparity

In 1963, the Equal Pay Act was signed into law to mandate that people should be paid the same amount for doing the same job, regardless of gender. In the ensuing 55 years, many factors have perpetuated gender wage disparity. Statistics vary, but a recent report indicated that the average woman earns 80.5 cents for every dollar earned by men. Men on average earn more than $10,000 a year more than women.

One factor that contributes to what could be seen as a vicious cycle of wage disparity is the ability of potential employers to ask applicants about their salary histories. A recent ruling by the 9th Circuit Court of Appeals (which includes Arizona) addresses that problem. The court ruled that an employer can’t justify paying a woman less than a man for the same work based on her salary history.

In the ruling, the court wrote that it agreed to hear the case “to clarify the law, and we now hold that prior salary alone or in combination with other factors cannot justify a wage differential.” It noted, “Congress enacted the Equal Pay Act in 1963 to put an end to the ‘serious and endemic problem of employment discrimination in private industry and to carry out a broad mandate of equal pay for equal work regardless of sex.”

The court stated that as long as a plaintiff is able to show a wage disparity, she doesn’t have to prove that discrimination is behind that disparity. It’s possible that a woman’s previous salary was lower than it should have been due to gender discrimination. Therefore, to base her new salary on that is perpetuating wage discrimination.

Of course, employers may justify wage differentials based on seniority, experience, performance and other factors. However, since employers can’t use a person’s salary history as a basis for a new employee’s starting salary, this could help chip away at the gender wage gap.

Currently, only a few states and cities nationwide forbid employers from asking about salary history when considering applicants. It’s not banned in Arizona or any cities here. However, employers can avoid lawsuits by not including the question on applications.

It can be tricky to prove that you’re being paid less simply because of your gender. However, if you believe that’s the case, it’s wise to seek advice from an Arizona attorney with experience in employment law.

Source: KTAR News, “Legally Speaking: Employers can’t justify wages based on prior salaries,” Monica Lindstrom, May 11, 2018