When it comes to feeling secure under the Equal Pay Act, California is the place to be. The state is known for historically falling in favor of employees when it comes to wage discrimination and anti-retaliatory acts on behalf of employers. However, as amendments continue within the EPA, the means for finding employee victories may change thanks to one major suit. The case of Coates v. Farmers Group Inc. et al. rose to nationwide awareness, as nearly 300 female attorneys fell into a suit against insurance giant Farmers Group, Inc. In the case, the company allegedly participated in practices geared toward grooming male employees for upward mobility. Those practices were compounded by better promotions for male employees, leading to higher wages, where female employees fell below the promotions and increased pay grade. The case stems from one female attorney learning that her male counterpart earned nearly double the amount of her salary, despite graduating from law school a year after she had. In addition, retaliatory acts followed once she highlighted the wage disparity. She was then reduced to basic tasks, ultimately suggesting a demotion for calling out the unfair behavior. Many followed in her footsteps, and it was found that she truly wasn’t alone in the apparent wage discrimination.
At the close of last year, Judge Lucy Koh of the United States District Court for the Northern District of California ruled in favor of the Plaintiffs to the tune of five million dollars. The reason may surprise you. Judge Koh allowed the female Plaintiffs to comparatively rate their wages alongside male employees of Farmers Group nationwide, finding glaring wage disparities beyond the case’s San Jose office origins.
This case arrives on the heels of California’s Equal Pay Act receiving significant amendments over the course of the last two years. Allowing for nationwide comparisons is an unorthodox approach to proving wage discrimination, though this may be the new move in cases to follow. After all, can a nationwide corporation really discriminate amongst genders from one state to the next? Historically yes they can, and have, but that may all change.
It’s certainly a cautionary tale for employers to truly take an audit of how their employees are paid by gender. For those with more than one corporate location, there is now an onus placed upon that data, specifically if discrimination cases originate in the State of California. Suits like these can set a precedent for other states to follow. The intention is not to scare employers, rather overtly express that wage discrimination will not be tolerated and new measures can pop up at any moment to ensure that compliance.
To learn more about achieving pay equity, and to receive a free pay gap risk assessment, click here.