Equal Pay Claims Involving "Red Lined" Positions

We are all familiar with the adage: "equal pay for equal work." But, as with most things, there are exceptions. One particular case addressed the issue of so-called "red lined" positions and how the courts may look at those positions in determining whether there is an actionable issue of pay inequality.

A red lined position may be an exception to equal pay

In the case of Fenton v. St. Lawrence County, two employees worked as personnel technicians, however the female employee, Deanna Fenton, was paid a significantly lower salary than the male employee, McDonough. According to the employer, Fenton's salary was strictly based on a salary schedule, but McDonough's salary was higher because it reflected the salary he had been receiving in a higher position, Personnel Director. He had been "downgraded" to a lower grade position during a restructuring and his salary was "red lined."

What does "red lined" mean?

As the Appellate court explained in that case, "red lined" or "red circled" refers to a particular business decision made when there is a reclassification of a position, a reorganization of some kind. An employee may be downgraded in position, but the employee's salary is maintained at the higher rate. This is considered a legitimate business reason for the pay disparity. The purpose is to prevent financially injuring an employee who was downgraded simply because of a reorganization.

The decision to red line a position may be an exception

As long as the decision to red line a position and maintain the higher salary is a legitimate business decision, based on a "factor other than sex," it may constitute an affirmative defense under the Equal Pay Act. In the case of St. Lawrence County, they had red lined the salaries of both male and female employees affected by the reorganization. As such, the court found the decision to be a legitimate defense.

The requirements for proving a violation of the Equal Pay Act

In order to establish a prima facie case of wage discrimination an employee can show the following:

(1) The employer pays different wages to employees of the opposite sex:

(2) The employees perform equal work on jobs requiring equal skill, effort, and responsibility; and

(3) The jobs are performed under similar working conditions

Once these elements have been established by the employee, the employer has the burden of showing that there was a legitimate justification for the pay disparity, or put another way, that the differences in pay were based on some factor "other than sex."

So, in Fenton v. St. Lawrence County, the employer offered as justification the fact that the male employee's salary had been red lined for business reasons, which resulted in his salary being higher than his female counterpart. At that point, the burden shifted again to the employee to show this reason was merely a pretext for gender discrimination.

Showing pretext for discrimination

The term "pretext" means a reason given by an employer to justify a course of action or decision, which is not actually the real reason. Employment discrimination attorneys are experienced at showing that a reason is pretext based on evidence such as statistics, similarly situated comparators (other similar employees), witness statements showing bias or falsity, or by simply demonstrating that the stated reason is illogical. Fenton was unable to do so in her case.

If you feel you have been the victim of discrimination, or if you have any questions regarding your employment rights, please contact the experienced employment attorneys at Wrady & Michel, LLC, either online or by calling us at (205) 265-1880.

Categories: Equal Pay
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