EEOC Settles Equal Pay Lawsuit with Extended Stay Hotels

Author: Beth P. Zoller, XpertHR Legal Editor

February 26, 2014

The Equal Employment Opportunity (EEOC) recently announced in a press release that it has settled a wage discrimination lawsuit with Extended Stay Hotels for $75,800 on behalf of a receptionist and three of her female co-workers. EEOC v. HVM L.L.C., D/B/A Extended Stay Hotels, Civil Action No. 8:13-cv-01980. The settlement confirms that the EEOC will continue to focus on equal pay and discriminatory pay practices as one of its six strategic enforcement priorities. Further, President Obama remains committed to providing equal pay for equal work and avoiding wage discrimination based on gender, as evidenced in his most recent State of the Union address.

In the lawsuit, the EEOC alleged that Extended Stay Hotels paid the receptionist $1.12 less than her male co-workers who performed the same work and generally paid female workers less than male co-workers for equal work. The EEOC further alleged that the receptionist's manager refused her offer to stay on with the company if she were given a raise.

In addition to paying the amount of the settlement, the hotel must:

  • Train employees annually on wage discrimination laws;
  • Report its handling of any wage discrimination cases to the EEOC; and
  • Post a notice of the settlement.

In commenting on the settlement, Spencer H. Lewis, Jr., District Director of the EEOC's Philadelphia office, stated in the press release that "[w]age discrimination has a pernicious effect on all workers, and often has a profound impact on the economic security of lower-income workers . . . This settlement addresses pay disparities and includes equitable provisions that should prevent pay discrimination in the future." Moreover, EEOC Regional Attorney Debra Lawrence reiterated that "[r]emedying gender-based pay discrimination is a priority issue of the EEOC. It is a matter of fundamental fairness that women should be paid the same wages as men when they are doing equal work."

Accordingly, employers should review their pay practices to be sure they are not discriminating on the basis of pay against employees who are members of a protected class and should correct any discrepancies found. Employers also should implement and maintain workplace policies that grant raises, promotions and bonuses based on merit and employee performance regardless of sex, race or national origin.