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Legal steps to combat wage discrimination

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Employers cannot prohibit employees from disclosing their own wages, discussing the wages of others, inquiring about another employee’s wages or aiding or encouraging any other employee to exercise his or her rights. (Courtesy photo)
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This week’s question comes from Tina in Noe Valley, who asks:

Q: “I think that I am being paid less than two men who are doing my same job. I work in Menlo Park, and there is a lot of talk about gender equality, but I don’t think it is being put into practice at my current job. We all have MBAs and started at the same time. One of the men is my same class, but the other worked in finance before getting his MBA. What is the status of the law and what can I do to find out if I am being discriminated against?”

A: Tina, you’re right: Studies show a pay gap exists between men and women. As I write this article, I am sitting next to my 10-year-old daughter at the airport, coming back from Disneyland, and I look at her and think no one should pay her less based on her gender (or her Mickey Mouse ears).

On Sept. 30, 2016, Gov. Jerry Brown signed into law Assembly Bill 1676, authored by former Assemblymember Nora Campos. AB 1676 codified changes in the Labor Code, including Section 1197.5. Existing law already prohibited discrimination based on sex, but there was a loophole that perpetuated historic salary disparity between men and women.

The gender disparity can be demonstrated by statistics showing that, in 2015, the gender wage gap in California stood at 16 cents on the dollar. For women of color, wage inequality is much worse: African-American women in California make just 63 cents for every dollar white men make and Hispanic women less than 43 cents. This is a fundamental unfairness.

Studies have shown that this disparity is self-perpetuating; unequal past salaries lead to a continuation of the inequality. As the bill said, “When employers make salary decisions during the hiring process based on prospective employees’ prior salaries or require women to disclose their prior salaries during salary negotiations, women often end up at a sharp disadvantage and historical patterns of gender bias and discrimination repeat themselves, causing women to continue earning less than their male counterparts.” Labor Code Section 1197.5 now states that prior salary cannot, by itself, justify a wage differential.

Labor Code Section 1197.5 (a) states, “An employer shall not pay any of its employees at wage rates less than the rates paid to employees of the opposite sex for substantially similar work, when viewed as a composite of skill, effort, and responsibility, and performed under similar working conditions, except where the employer demonstrates: (1) The wage differential is based upon one or more of the following factors: (A) A seniority system; (B) A merit system (C) A system that measures earnings by quantity or quality of production;  or (D) A bona fide factor other than sex, such as education, training, or experience.”

If you feel you are or have been suffering pay disparity you have options: 1) You can go to the Division of Fair Labor Standards Enforcement, which is empowered to enforce the law, or 2) you can locate a good employment law trial lawyer to handle your case either hourly on a contingency (meaning compensation is paid only if they successfully resolve your case). We handle such actions.

In a civil lawsuit brought under Labor Code Section 1197.5, if you can demonstrate that you have received less than the wage to which you were entitled, you may recover in a civil action the balance of the wages, including interest thereon, and an equal amount as liquidated damages, together with the costs of the suit and reasonable attorney’s fees, notwithstanding any agreement to work for a lesser wage. Liquidated damages are damages set at a predetermined amount — in this case, the amount of the under payment.

A civil action to recover wages must be commenced no later than two years after the cause of action (the underpayment) occurs, except that a cause of action arising out of a willful violation may be commenced no later than three years.

Although the law does not require anyone to disclose their wages, it clearly states that an employer shall not discharge, or in any manner discriminate or retaliate against, any employee for acting to invoke or assist in any manner the enforcement of this section. Employers can’t prohibit employees from disclosing their own wages, discussing the wages of others, inquiring about another employee’s wages or aiding or encouraging any other employee to exercise his or her rights under this section.

Any employee who is discharged, discriminated or retaliated against, in the terms and conditions of his or her employment because they sought to exercise their rights under Section 1197.5, can file suit to be reinstated, reimbursed for any lost wages with interest, and/or receive any lost promotions or other benefits. There is a one-year period in which such claims must be brought. 

Tina, if the male co-worker with more experience is getting paid more than his experience could explain a pay disparity, you may have the basis for a lawsuit. If he is willing to share his compensation plan with you, then that would be a good place to start your inquiry. If he won’t, ask HR for the numbers. If there is a disparity, ask for the remedy I laid out above: back pay and interest and adjustment of your wage to be equal to your colleague. Show them this article. Maybe it will help them get the picture.

Whatever course you take, make sure to create a record through email or other documentation in case you are retaliated against. As I always say, first try and work it out with your employer if possible. Lawsuits are time-consuming, often exhausting, business.

Christopher B. Dolan is owner of the Dolan Law Firm. Email questions to help@dolanlawfirm.com.

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