March 15, 2019 / 10:01 PM / 5 months ago

A Rorschach test on equal pay and workplace sex discrimination

(Reuters) - Earlier this week, U.S. District Judge John Lee of Chicago issued a summary judgment opinion in an advertising sales executive’s equal pay and sex discrimination case against Gannett, the publisher of USA Today. I’m not going to tell you yet how the judge ruled. That’s because, as I read Gannett’s summary judgment brief and the ad rep’s opposition – which, because this was summary judgment briefing, are based on undisputed facts – it occurred to me that the case is a revealing test of perceptions about men and women and white-collar office jobs.

The Gannett sales rep, who is named Lori Hubers, did not allege that anything terrible happened to her at her job – she was not sexually harassed nor subjected to retaliation. When she left Gannett after less than two years of employment, it was of her own volition. The facts in Hubers’ case are subtle and ambiguous. I suspect that your own experiences will color your view of their significance.

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Here are the facts. Hubers was hired as an executive for USA Today’s national ad sales in December 2013. Her base pay was $135,000. Her maximum commission pay was originally $90,000, later boosted to $135,000. Hubers worked in a cubicle in Gannett’s Chicago offices. She occasionally worked from home but heard from coworkers that her manager complained when she wasn’t in the office. She took care to log all of her vacation time because she’d been told that was the rule. Hubers, both sides agree, was a rule follower.

Joseph Martin was hired a year before Hubers. He was also an ad sales executive, though he initially worked for a Gannett subsidiary specializing in sports ad sales. Martin’s base salary was $190,000, with a target commission of $90,000. In the fall of 2014, Gannett eliminated the sports subsidiary and folded Martin in to the national ad sales team. A higherup at the company decided not to cut Martin’s pay package, which was higher than that of Hubers and the other ad sales reps. Martin earned more than even his and Huber’s boss, a man.

Martin worked in the same office space as Hubers. When he was still working for the sports division, he took over an office. No one assigned him the private space. He simply noticed it was empty and took it. He remained in the private office when the sports group was dissolved and he joined the rest of the national ad sales team.

Martin got along well with the ad sales team’s supervisor. The two went to baseball games and golf outings together, some of which may have involved Gannett advertising clients. According to Hubers and a coworker, the boss didn’t ask questions when Martin worked from home, sometimes several days a week. Nor was Martin criticized, according to Hubers, for neglecting to track his vacation days.

How do you interpret those facts? Hubers’ lawyers, Kathryn Korn and Fred Roth, contended that they showed a workplace subtly rigged in favor of male employees. Most tellingly, they said, Martin was paid significantly more than Hubers for the exact same work. If Gannett didn’t want to offend Martin by cutting his compensation to match the scale on the national ad sales team, she said, the company could have raised her pay to match his.

But pay wasn’t the only disparity between Hubers and her male colleague, she said. Her success was undermined in small ways that reflected gender bias, like the boss going to ballgames with Martin and his clients and allowing Martin to claim a private office. Hubers’ lawyers drew a contrast between their client’s respect for workplace norms and her coworker’s allegedly consequence-free flouting of those rules.

Gannett, which was represented by Baker & Hostetler, argued that gender bias had nothing to do with Hubers’ work experience. According to the company, Martin started out with higher pay than Hubers because the sports subsidiary that originally hired him paid higher base salaries. (The company considered sports advertising more lucrative.) When Martin joined Hubers’ group, he out-earned not just her but also men on the same team – including the group’s supervisor.

Nor is there evidence, Gannett said, that the boss favored Martin over Hubers because of their gender (or even, according to Gannett, that he favored Martin at all). Even if her allegations about working from home and logging vacation time were true, the company said, Hubers couldn’t show that Gannett granted her male coworker privileges she was denied. No one, for instance, told her that she couldn’t follow Martin’s lead and claim a private office instead of her cubicle.

And Hubers had a client entertainment account, like just Martin, the company said. She used it, according to Gannett, to host clients for lunches, dinners and spa treatments. And even if the boss didn’t go to baseball games with Hubers and her clients, Gannett’s motion said, he was always available to attend her meetings and once went with her to St. Louis to see a client.

So in the company’s version of the story, Hubers had the same opportunities as Martin. Whatever head start he enjoyed was an artifact of base pay set by people outside of the national sales team – not of tacit favoritism for a man.

Judge Lee sided with Gannett. On Huber’s gender discrimination claims under state and federal law, he said it was possible to read the facts to suggest that Hubers suffered an “adverse employment action” – but not that the adversity was based on her gender. “Of the admissible evidence, there is nothing that suggests that Hubers and Martin were treated differently, or if they were, that the difference was due to sex,” the judge wrote, ticking off Hubers’ allegations about logging vacation time, working from home and joining the boss for client events.

The equal pay issue merited more discussion in Judge Lee’s decision. As you probably know, there’s some turmoil in the federal circuits – and in state and local legislatures – on the issue of whether employers can premise compensation on employees’ salary history. In 2018, the en banc 9th U.S. Circuit Court of Appeals broke with previous 9th Circuit precedent to hold in Rizo v. Yovino that the Equal Pay Act precludes employers from relying on employees’ salary history because past pay may reflect gender bias. (Last month, the U.S. Supreme Court vacated the Rizo decision because the en banc majority included Judge Stephen Reinhardt, who died before the opinion was issued.)

Precedent in the 7th Circuit, however, holds that employers can cite salary history to explain pay disparities between male and female employees. Hubers’ lawyers tried to argue that the 7th Circuit’s previous cases, 2017’s Lauderdale v. Illinois Department of Human Services and 2005’s Wernsing v. Department of Human Services, involved state agencies with limited budgets. Gannett, they said, could have solved the equal pay issue by boosting Hubers’ salary to match Martin’s. But Judge Lee said 7th Circuit rulings do not require employers to make that accommodation when salary discrepancies are based on prior compensation.

“The court in Wernsing expressly rejected Hubers’ argument, and Lauderdale made abundantly clear that prior salary alone — irrespective of the use of a pay scale — is sufficient to support a pay differential,” he wrote.

The judge granted summary judgment to Gannett on Hubers’ equal pay and gender discrimination claims, though he kept alive her claim that Gannett underpaid her commission when she left the company. Hubers’ counsel Fred Roth, who is also Hubers’ boyfriend, told me that they plan eventually to appeal the salary history issue to the 7th Circuit. He told me that Judge Lee’s decision doesn’t even reflect the entirety of the compensation disparity between Hubers and her male colleague because it didn’t delve into their supervisor’s allocation of accounts, which, according to Roth, made it easier for Huber’s coworker to meet his quota. Gannett counsel Bonnie DeGabbo of Baker Hostetler didn’t respond to an email requesting comment.

Hubers did just fine after leaving Gannett, Roth said. She had a different ad sales job for a while, then decided to start up an interior design business that’s now doing very well, according to the lawyer.

Now she’s her own boss. That’s one sure way to be sure you’re not experiencing employment discrimination because you’re a woman.

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