We first covered the U.S. women’s national soccer team’s (WNT) Equal Employment Opportunity Commission (EEOC) discrimination charge against the U.S. Soccer Federation (USSF) in this article. Nearly three years later—and appropriately on International Women’s Day—28 WNT players have filed a proposed class and collective action lawsuit against the USSF for unequal pay.
Given a wave of new state laws, increased enforcement of federal law, and high-profile lawsuits, the equal pay issue has become a central focus for employers. Filing unequal pay claims has become an attractive option, particularly because they can be filed as class and collective actions, which can be incredibly costly to employers. Given the recent trends, it’s important to take preventative measures by staying in compliance with current laws and reducing your exposure to class and collective actions.
On March 8, 2019, the WNT filed a proposed class and collective action in California federal court against the USSF for sex-based discrimination under the Equal Pay Act (EPA) and Title VII of the Civil Rights Act of 1964. The complaint alleges the USSF—which employs professional soccer players who play for the WNT and men’s national soccer team (MNT)—paid the female soccer players significantly less than the male soccer players despite having the same job responsibilities and superior job performance.
Specifically, the team members allege they achieved “unmatched success” that led to “substantial profits,” which “outstripped” the MNT’s net profit. They further allege the job requires both female and male soccer players to have a high level of competitive soccer skills, physical conditioning, certain nutrition, physical therapy, national and international travel, and adherence to the same rules, among other factors. They claim that since 2012—and in entering a new collective bargaining agreement in 2017—the USSF has rejected the WNT’s requests for equal pay afforded to the MNT players. They also allege the USSF has provided them with less favorable resources, including inferior surfaces on which to play and less suitable travel options.
So why should this concern you? Below is a discussion on class and collective action and equal pay concerns.
Class and Collective Actions
In class and collective actions, instead of each member filing his or her own separate lawsuit, one person or a small group (here, 28 WNT members) files a lawsuit on behalf of a larger group that shares the same characteristics. Class and collective actions are typically filed together, though they differ procedurally and substantively. For instance, in a collective action, the group members must decide to “opt in” to the lawsuit. In a class action lawsuit, group members who do not wish to be bound by the decision must “opt out” of the lawsuit. Moreover, EPA claims can be filed only as a collective action.
To proceed as a class and collective action, the court will need to decide whether to “certify” the class. In other words, the court determines whether the named employees have enough similarities to proceed with the litigation against the employer as part of one larger case. If it finds they don’t have sufficient similarities, then the lawsuit won’t proceed as a class and/or collective action, and each employee must then separately file an individual claim.
Preventative Measures to Keep in Mind
To prove sex-based discrimination under Title VII, an employee must show she is paid less than a similarly situated male employee who is directly comparable in all material respects, and that the employer intended to discriminate against her. To prove sex-based discrimination under the EPA, she must identify a male employee who performs a substantially equal job and was paid more. The EPA doesn’t require employees to demonstrate the employer intended to discriminate.
Discrimination class and collective action lawsuits often take many years to resolve and are complicated and costly. Once a class is certified, litigation expenses can increase dramatically because the number of employees in the lawsuit can expand greatly. Claims for unequal compensation tend to be easier to certify.
Moreover, unequal pay claims aren’t going away. Over the past several years, there has been an increase in EPA claims and equivalent state laws. The EEOC has also ramped up its enforcement of the EPA and aggressively pushed forward on pay equity initiatives, including proposing changes to employer reporting procedures and pursuing unequal pay claims against employers.
To help prevent unequal pay discrimination lawsuits, below is a refresher of the tips we included in our May 2016 article:
- Review job descriptions to ensure they accurately reflect each job’s responsibilities and the skill and effort required.
- Conduct audits on a regular basis to determine whether there are gender-based wage gaps (or gaps based on any other protected characteristic). If gaps exist, scrutinize the reasons for the differentials to determine whether they are based on legitimate nondiscriminatory reasons. If a gap was initially justified by a legitimate reason other than sex, consider whether the factor is still relevant.
- Keep records documenting the reasons for wage differentials.
- Remember that the prohibition on wage disparities applies to all forms of compensation, including bonuses, reimbursement for travel expenses, overtime, stock options, and benefits. Thus, wage audits should encompass all forms of compensation.
- If it’s necessary to correct a differential, address it promptly. Remember that an employee’s wages may not be reduced to equalize pay. Rather, the wages of the lower-paid employee must be increased.
- Review your antidiscrimination policies to ensure they address wage discrimination issues, require reporting, and prohibit retaliation.
Below are some recommendations to help decrease the likelihood of class and collective action lawsuits:
- Establish clear goals and expectations when conducting audits to uncover vulnerabilities in wage and hour policies and practices that might support a discrimination claim;
- Review all proposed business transactions and operational changes, including changes in compensation policies; and
- Consider including arbitration clauses in employment contracts to prevent employees from filing class action lawsuits. Arbitration can prevent employees from coming together and pooling resources against you, thereby reducing your litigation costs.