Employers Can't Use Salary History to Justify Gender Pay Gaps, 9th Circuit Rules

Author: David B. Weisenfeld, XpertHR Legal Editor

April 18, 2018

An employee's prior salary cannot justify a pay gap between men and women for performing similar work, the 9th Circuit Court of Appeals has ruled in Rizo v. Yovino.

"Reliance on past wages simply perpetuates the past pervasive discrimination that the Equal Pay Act seeks to eradicate," wrote Judge Stephen Reinhardt for the full San Francisco-based appellate court. Judge Reinhardt also noted that women continue to receive lower earnings than men across industries, occupations and education levels and that the gender wage gap costs women in the US more than $840 billion a year.

This case involved claims brought by a female management-level math consultant, Aileen Rizo, with the Fresno County Office of Education. Under the county's standard operating procedure, Rizo received a 5 percent increase over her salary from her previous job along with additional compensation. But she later learned that the other math consultants, all of whom were male, earned more than she did.

A three-judge 9th Circuit panel ruled in 2017 that an employer may use a job applicant's salary history to determine the individual's pay in certain circumstances, even if it results in a female employee earning less than male colleagues for performing the same work.

But this new ruling, by the full 11-judge appellate court, found that to accept the employer's argument would continue, rather than eliminate, gender-based pay discrimination. Prior salary is not a legitimate measure of work experience, ability, performance or any other job-related quality, the court explained.

This decision is in line with the legislative trend of pay equity laws governing male and female employees who perform substantially similar work. Several states have passed pay equity laws, including:

Meanwhile, a New York City law bars employers from asking about salary history during any stage of the hiring process.