Google has been in the news a lot. I’m sure that statement doesn’t come as a big surprise. Not all the news is positive. That might not be a surprise either. Pay equity has been a big concern among many employers. This too shouldn’t come as a surprise. At least a few employers looking to address this issue will start with a Google search of the terms “pay equity” and “pay discrimination”. If you’ve read some of my other posts you may know that I can’t resist pointing out irony. So how about this one: If you Google “pay discrimination” or even “pay equity”, guess what? Yep. You might find Google in your search results–and not just once. Here are two examples:
In 2017, 3 women filed a class action lawsuit, on behalf of themselves and others similarly situated at Google, claiming they were paid less than their male counterparts. The California Superior Court dismissed the case, finding the claim too “vague” and overbroad, but ruled that the women could re-file and provide sufficient specifics. They did so in January 2018, and last year the class action lawsuit was revived. The lawsuit actually arises out of pay data submitted by Google to the federal government. The class of plaintiffs allege that Google violated the California Equal Pay Act by tying starting salaries to job candidates’ prior compensation and placing women in lower-paying job classes (more on this in a moment). The case is Ellis v Google and you can read the complaint here, if you are interested.
Last week, another female engineer sued Google, claiming she she is being paid less than her male peers and that she was demoted in retaliation for complaining about it. Although she was allegedly instrumental in Google Cloud’s financial services offering and has received “exceeds expectations” on all of her performance reviews, Google allegedly hired her at a lower level than similarly situated men, paid her less than her male counterparts and refused to promote her to a role for which she was the most-qualified candidate. After complaining to HR, she claims that Google moved her to a position offering limited development opportunities, and then offered her 3 other options, all of which were “undesirable”. She further claims that Google’s investigation of her complaint was “cursory” and “ignored plain facts”. That case is Rowe v Google, LLC. You can find that complaint here.
Now, I know that both of these cases are pending. It’s too early for any factual findings. I also know that Google is not the only one alleged to have discriminatory pay practices. With that said however, and assuming for the moment that the allegations are true, what can all other employers learn from these cases? In other words, how can you ensure that you won’t follow in Google’s footsteps and find yourselves at the receiving end of the same type of lawsuits? I can offer you the following thoughts: In the class action lawsuit, the main (or at least one main) allegation is that Google based pay on salary history. Some states, including California, have expressly prohibited such practices and may even ban asking about salary history during the application process. If any of your employees work in any such states, then basing pay on salary history will be an express violation of state law. What if your employees work in states that don’t currently have such laws, however? There’s still federal law, specifically the Equal Pay Act, which prohibits paying women less than men for (or men less than women for that matter) performing the same or substantially equal jobs. To the extent that women have historically been paid less than men for the same or substantially the same work, basing current pay on past pay would perpetuate the pay gap, for reasons having nothing to do with job functions or qualifications. In other words, if you base pay on entirely or even primarily on salary history you are probably setting yourself up for a pay discrimination claim.
The more recent case, in addition to alleging pay discrimination, involves a retaliation claim. Even if this employee cannot prove she was subjected to discriminatory pay practices, she might succeed on the retaliation claim, which could actually yield more in money damages than her pay discrimination claim. The timing of the demotion, which apparently happened shortly after her complaint is certainly suspicious, especially given her previous performance reviews where she received ratings of “exceeds expectations”. That’s not all though. While Google did investigate, if the allegations are true, it was a slipshod investigation that ignored significant facts (presumably any that would not have supported the conclusion Google wanted), which brings me to my next point: A half-baked investigation is about as bad as doing none at all. In fact sometimes it’s even worse. It suggests that the employer didn’t really care about the truth, wanted to create the appearance of doing what it was supposed to, but essentially swept the allegations under the carpet. That does not play well with a jury.
OK, let’s boil it down to these takeaways:
- Base your pay practices on job functions and job qualifications (and make sure you have current, written accurate job descriptions to back up your practices);
- Do NOT base your pay practices on an employee or applicant’s salary history, and whenever possible, avoid asking about it at all;
- If you do decide to pay an employee less than his/her similarly-situated peers, make sure you have a solid justification that has nothing to do with gender (or any other protected class) and document it;
- If any employee complains of any type of discrimination (whether or not it’s pay discrmination), DON’T take any adverse employment action against him/her, unless you have solid evidence of a non-retaliatory motive–in which case, document it;
- Take all complaints seriously and do prompt and thorough investigation, and consider ALL relevant information, even if it does not support the conclusion you want.
That’s all I’ve got for now. See you next week!
Watch my first of two television interviews on Stop My Crisis with Vivian Gaspar.
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