Court rules salary history can be used to set new pay

Tennessee workers who may be facing a discriminatory wage disparity may be interested to learn that the U.S. Court of Appeals for the 9th Circuit has ruled that an employee's salary history could be used to set pay. This decision contradicts other appeals court rulings, meaning that the U.S. Supreme Court may need to resolve the issue.

A female math consultant learned that she was paid less than her male colleagues even though they all had the same job title. She filed a lawsuit against the employer, claiming that the wage disparity was a violation of the Equal Pay Act. A district court ruled in favor of the female employee, arguing that the lower pay perpetuated wage disparity between men and women.

However, the federal appeals court disagreed and reversed the lower court's ruling. The court stated that using prior salary to set the new salary did not violate the Equal Pay Act. In this particular case, the employer argued that its pay policy was objective by always providing new employees with a 5 percent raise over their prior salary. This prevented favoritism and allowed them to have consistent hiring practices.

Although the federal Equal Pay Act protects employees from potential wage disparity, state hour and wage laws might offer broader coverage. An attorney may assist with providing proof that the wage disparity was caused by discrimination. This evidence could potentially include a pattern in the employer's hiring practices. The employee could then seek compensation for the income that should have been received.

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