Dear HR Executive:
It's not great employee relations to stonewall someone's request for a raise. And now it appears it can also raise legal warning flags.
A federal appeals court recently ruled that as far as pay discrimination law is concerned, ignoring an employee’s request for a raise is the same as denying it.
The court was deciding a Pennsylvania case in which a female employee complained she was paid less than comparable men. The court said the employer’s failure to respond to her raise request amounted to a “compensation decision.” And compensation decisions are covered by Title VII, the federal law outlawing sex discrimination.
Long-term consequences
Under the Lily Ledbetter Fair Pay Act of 2007, each allegedly discriminatory paycheck arising from a compensation decision is a separate violation of Title VII.
In practice, this means employees can bring legal action based on an initial pay decision going back years, as long as they file an EEOC charge within 300 days of their last allegedly discriminatory paycheck.
Giving an answer
In light of this decision, HR may want to:
- Review your compensation communication policy with line managers so they know what to say when approached for a raise, and
- Make sure you have documented, non-discriminatory support for the level of each employee’s pay.
Dave Clemens
Editor-in-Chief
HR Rapid Learning Center
UPCOMING AUDIO CONFERENCE: Don't miss B21’s upcoming audio conference , "Exempt or Nonexempt? Prepare for More Aggressive Wage & Hour Enforcement Under Obama". On Wednesday, November 4, our speaker, Edward Bergmann, Esq., will lay out for HR executives a detailed overview of the white-collar exemptions, providing specific, practical examples showing how they’re applied. The course will also highlight the “hot spots” -- those areas where employers are prone to make classification mistakes, and offer advice for conducting audits.
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