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Male Successor’s Alleged Greater Ability to Negotiate over Salary Not a Defense to Equal Pay Act Claim

Apay disparity between a female employee and her male successor was not justified, as a matter of law, by a company’s claim that he was better able to negotiate over salary, a federal court has held. Dreves v. Hudson Group (HG) Retail, LLC, No. 2:11-cv-4 (D. Vt. June 12, 2013).

The plaintiff, a general manager of Hudson Group stores at Burlington International Airport, alleged the employer violated the federal Equal Pay Act when it terminated her and paid a higher salary to her male successor. According to the employ- er, the higher salary was justified because:

  • after its initial offer, the male successor negotiated a higher salary;
  • the male successor had more than six years of management experience with the employer;
  • the cost of living in Burlington, Vermont, was greater than the male successor’s previous location; and
  • the male successor needed to be induced to move his family to the area. 


The plaintiff moved for summary judgment on her claims, which the court granted. The court held that, when a plaintiff has established a prima facie case of an Equal Pay Act violation,
 a defendant’s “factor-other-than-sex” defense cannot be grounded on the male successor’s alleged ability to negotiate a higher salary. A defense also may not be based on a company’s alleged need to induce the successor to agree to employment, unless the employer can show the inducement is based on a valid business purpose, the court said. For example, the employer can offer an inducement to a potential employee who has better qualifications or greater experience than the claimant.

The court concluded the employer in this case lacked a valid defense as it did not show that the inducement to the male successor based on his family circumstances was related to any unique characteristic of his position, his qualifications, experience or abilities, or any exigent circum- stances associated with the employer’s opera- tions.

This case highlights the difficulties retailers can face in attracting talent or making a decision regarding compensation of salaried employees. Companies must base compensation decisions, including initial offers, starting salaries and raises, on valid business purposes to avoid potential liability under federal equal pay requirements.

Jackson Lewis P.C. © 2020National Law Review, Volume III, Number 349

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About this Author

Mark Askanas, Jackson Lewis, arbitration forum attorney, employment dispute lawyer, preventive employer group legal counsel
Principal

Mark S. Askanas is a Principal in the San Francisco, California, office of Jackson Lewis P.C. He joined the firm in 1988 and is a senior employment law litigator who has served as lead counsel for cases in state and federal courts, as well as arbitration forums, throughout the western United States.

Mr. Askanas specializes in complex litigation, including class actions and cases involving trade secrets and confidential information. He also counsels employers on all facets of employment law including, but not limited to,...

415-394-9400
Dylan B. Carp, Jackson Lewis, unfair competition lawyer, trade secrets law attorney
Principal

Dylan B. Carp is a Principal in the San Francisco, California, office of Jackson Lewis P.C. He is a Certified Specialist in Appellate Law by The State Bar of California Board of Legal Specialization.

Mr. Carp has argued 10 appeals before federal and state courts. In addition to appeals and writs, Mr. Carp focuses his practice on unfair competition and trade secrets law, having second chaired a three-month unfair competition jury trial.

Mr. Carp also handles all aspects of litigation in cases involving discrimination, harassment, disability, and wage and hour issues, including taking and defending depositions, briefing and arguing dispositive motions, and participating in mediations and settlement conferences. In addition to Mr. Carp’s litigation practice, he counsels employers on unfair competition, discrimination, harassment, and wage and hour issues.

415-796-5425