Tuesday, April 27, 2021

Ninth Circuit Rejects University’s Latest Attempt to Scuttle Professor’s Equal Pay Case


By Jennifer Reisch

On Friday, April 23, 2021, the full 9th Circuit Court of Appeals issued an order in Freyd v. University of Oregon, No. 19-35428 (9th Cir. 2021) rejecting the University of Oregon’s petition for rehearing en banc, its latest attempt to prevent the pay equity claims of renown psychology professor Jennifer Freyd from going to trial.  The order leaves intact the March 15 decision reversing summary judgment on Professor Freyd’s Equal Pay Act and Title VII disparate impact claims, solidifying positive precedent for workers seeking fair pay across industries and occupations, where gender and race wage gaps remain the norm. 

The Freyd opinion and order denying en banc review came as welcome news for the plaintiff and supporters of gender pay equity, dozens of whom joined amicus briefs filed in support of her appeal back in 2019. It came on the heels of Equal Pay Day, a symbolic date that marks how far into this year women employed full-time had to work to earn what men were paid, on average, in 2020. The persistent gender wage gap costs women and families nearly $1 trillion dollars per year and hits particularly hard in a year that saw women being pushed out of the workforce in record numberslosing more than half of the jobs shed by the U.S. economy during the COVID pandemic. 

In 2021, women are still paid less that men in almost all occupations and pay gaps still grow as education levels increase, with the largest disparities among workers with advanced degrees  like Professor Freyd.

Freyd, a tenured professor of psychology and renowned trauma studies scholar, first discovered she was being paid significantly less than several of her male colleagues back in 2014. Men who held the same positions, in the same department, but had less seniority and were no more accomplished than she, were making tens of thousands of dollars more. And while Freyd’s pay disparity was particularly glaring, it was not unique: her own regression analysis and other studies conducted by the university and independent analysts found a “significant equity problem with respect to salaries at the full professor level” in her department. This disparity was driven primarily by the practice of giving “retention raises” to certain (disproportionately male) professors as an incentive to remain at the university, without making corresponding equity adjustments to the salaries of other (disproportionately female) faculty members, like Freyd, who did not seek outside offers to leverage higher pay. 

After attempting to resolve the issue internally over three years to no avail, Freyd filed suit in the U.S. District Court for the District of Oregon, asserting claims under the federal Equal Pay Act (EPA), Title VII of the Civil Rights Act, the U.S. and Oregon constitutions, and related state laws. The district court threw out all of her claims on summary judgment. In dismissing her EPA claim, Judge Michael McShane held that Freyd did not do “equal work” to her male comparators, even though they held the same position and rank, had the same core job functions and responsibilities, and were evaluated based on the same criteria. The university argued — and the district court agreed — that Freyd could not show she did “equal work” to the comparators because they conducted different types of research, ran different labs, obtained research grants from different sources, and sat on different university committees. 

In its March 2021 decision, the 9th Circuit reversed, rejecting the view that granular distinctions in the way individuals carry out particular segments of their job make it impossible to establish that they did substantially equal work (or “work of a comparable character,” under Oregon’s equal pay statute) as a matter of law, especially if they hold positions that share a “common core of tasks.” The court affirmed that under the EPA, the concept of “equal work” does not mean each aspect of the work must be “identical.”  The majority opinion (written by Judge Jay Bybee) underlined the importance of comparing the overall content of jobs, “not the individuals who hold the jobs” in determining whether a plaintiff could establish a prima facie case under the law.  Embracing arguments advanced by amici Equal Rights Advocates and other women’s and civil rights organizations, the majority noted that, “the granularity with which the dissent picks through the facts would gut the Equal Pay Act for all but the most perfunctory of tasks.” This would render the EPA a dead letter for huge swaths of the workforce, not just academics, ignoring the law’s “broadly remedial” purpose and frustrating its intent.

The decision reinforced the importance of closely scrutinizing market-based defenses to discriminatory pay practices precisely because they are so likely to perpetuate the very gender wage disparities that our equal pay laws are designed to address.

In reversing summary judgment on Freyd’s disparate impact claim under Title VII, the 9th Circuit recognized that she was not challenging the practice of giving retention raises, per se, but rather “the specific employment practice of awarding retention raises to some professors without increasing the salaries of other professors of comparable merit and seniority.” This important distinction was lost on the dissent (penned by Trump appointee Judge Lawrence VanDyke), which lamented that limiting the unequal application of retention raises will hinder universities’ ability to compete and cause “brain drain” — a position echoed by the university in its statement following the decision. The problem with this position—aside from its gender- and racially biased undertones about whose “brains” are worth retaining—is its implication that only through engaging in discriminatory employment practices can the university (and other employers) attract and retain the “best and brightest” and succeed financially. 

Fortunately, the majority recognized that disputed issues of fact remain about whether the university’s retention raise policy actually represents a “business necessity,” and if so, whether Freyd’s proposed alternative practice — of “evaluating the resulting salary disparity with others in the same rank with comparable merit and seniority, and giv[ing] affected individuals a raise” — would be equally effective in accomplishing the goal of retaining talented faculty, without having a discriminatory impact on women. This aspect of the decision serves as a reminder that there is nothing inevitable or natural about compensation structures and practices; they are devised by human beings -- and can be changed by human beings.

Finally, the court reversed the district court’s finding that the small size of the psychology department precluded Freyd from using statistical evidence to support her pay discrimination claim. This important aspect of the ruling affirms that courts must not deprive employees of Title VII protections simply because they work in a small employee pool.

All workers deserve to be paid fairly and valued fully. But closing the gender wage gap and ensuring fair and equal pay for all won’t happen by accident. Achieving these goals will require bold, persistent efforts by workers, like the brave employees who achieved remarkable settlements to advance equity and racial justice at Kaiser Permanente last week; by creative advocates, like those tenaciously fighting for equal pay at Oracle; and by employers who heed the call to act, in the words of Dr. Freyd, with institutional courage by taking proactive steps to make workplaces more diverse, equitable, and inclusive. 

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Jennifer Reisch is Of Counsel to Bryan Schwartz Law and the former Legal Director of Equal Rights Advocates, who co-authored its amicus brief in the Freyd case.

Tuesday, March 30, 2021

NLRB Slaps Back Elon Musk for Union Busting Tweet

Tesla landed itself back in the news last week for yet another dose of negative publicity, courtesy of the quick-tweeting trigger finger of its CEO, Elon Musk. This time, the National Labor Relations Board (“NLRB”) found Musk to have threatened employees with a loss of stock options if they chose to be represented by the United Auto Workers labor union. The 2018 tweet in question read: “Nothing stopping Tesla team at our car plant from voting union. Could do so tmrw if they wanted. But why pay union dues and give up stock options for nothing? Our safety record is 2X better than when plant was UAW & everybody already gets healthcare.”

Musk’s social media usage has already gotten Tesla into tens of millions of dollars of trouble. His tweet that he was considering taking Tesla private led to artificial investment in Tesla stock, even though the tweet had no basis in fact. The Securities and Exchange Commission fined him and Tesla each $20 million. Musk later said the penalty was “worth it,” speaking volumes about the weakness of the regulatory scheme that is meant to protect against the ultra-wealthy’s abuses of power.

Last week’s NLRB decision represents another agency’s attempt to rein in Musk’s unlawful social media posts. The NLRB ordered Musk and Tesla to stop threatening employees for supporting labor efforts, delete the tweet, place a notice regarding unfair labor practices at the Fremont plant, and place notices about the tweet in all Tesla facilities nationwide. The NLRB decision also reinstated with backpay a Tesla employee who was wrongfully terminated in retaliation for his union activities. Neither Tesla nor Musk will be faced with any penalties other than the employee’s backpay.

Bryan Schwartz Law is no stranger to Tesla and Musk’s unlawful workplace ethos. Since 2017, BSL has been litigating a case against Tesla concerning appalling race harassment at its Fremont factory. The NLRB decision is a positive development for workers, hopefully the start of many changes at the Tesla workplace to protect employees from abuses.

If you have experienced retaliation or discrimination at Tesla, contact Bryan Schwartz Law.

Friday, March 5, 2021

Whistleblower Victory Means Public Entities are Subject to PAGA - Sargent v. Board of Trustees


The Court of Appeal today certified for partial publication (hopefully soon to be full publication)
 Sargent v. Board of Trustees of CSU, a case led by Collier Law Firm (Bryan Schwartz Law's co-counsel) with amicus support from Bryan Schwartz Law writing on behalf of the California Employment Lawyers Association.

In Sargent, the Court of Appeal held unequivocally that aggrieved public employees can bring some PAGA claims against their employers - in particular, PAGA claims derived from Labor Code sections that provide for civil penalties (i.e., as opposed to those where only PAGA default penalties would be implicated). Government entities have argued that PAGA categorically does not apply to them - with some success at the the trial court level - but this decision should put that argument to rest. The Court relied on Kim v. Reins' holding that an employee has standing to bring PAGA claims when he/she was aggrieved by at least one claim personally - even if he/she did not personally experience all the violations.
  
Plaintiff Sargent blew the whistle on health/safety violations at the CSU, involving asbestos and other hazardous materials. He promptly received six written reprimands and ultimately was constructively discharged. The jury found cat's paw liability, under Reeves v. Safeway (CACI 2511), after the trial court sustained some of plaintiff's important evidentiary objections - which the Court of Appeal upheld. 

The Collier Law Firm fought thousands of hours in the trenches to prevail in the underlying jury verdict (the docket ran 167 pages, as the Court of Appeal pointed out). Though the plaintiff's underlying award will be modest, the Court of Appeal upheld a $7.8M fee award resulting from Defendant's scorched-earth litigation tactics, plus a well-deserved 2.0 lodestar fee multiplier. The Court rejected apportionment between successful/unsuccessful claims, and held that fees were supported under public-benefit theory, CCP 1021.5 (and did not reverse the trial court's finding that they were appropriate also under catalyst theory).  Importantly, the Court of Appeal rejected CSU's argument that CSU should not have to pay such a fee multiplier because the defendant is a public entity.

Sargent serves as a cautionary tale to defendants who fight with scorched-earth litigation tactics. The Court of Appeal cited defense counsel's billed hours and number of attorneys staffed on the file, as evidence that plaintiffs' counsel's billing was not excessive and that plaintiff's fees were reasonable. The Court upheld the award even though it reversed all the PAGA penalties that were awarded to the plaintiff (because they were not based upon PAGA penalties for Labor Code violations of sections with their own penalty provisions).

Bryan Schwartz Law congratulates the Collier Law Firm and all those who worked to win the important Sargent precedent.

Friday, February 26, 2021

Promising Developments for LGBTQ Workers

After four years under a President who did everything in his power to strip LGBTQ people of their rights, things are finally looking up for LGBTQ workers. On his first day in office, President Biden issued an Executive Order instructing his administration to vigorously enforce the federal anti-discrimination laws which prohibit discrimination on the basis of sexual orientation and gender identity. And this week, the House of Representatives voted to pass the Equality Act, which would amend the Civil Rights Act of 1964 to explicitly encompass protections for gay, lesbian, bisexual, transgender, and queer people.

 

Biden’s Executive Order requires federal agencies to follow the landmark Supreme Court decision in Bostock v. Clayton County, which Bryan Schwartz Law has written about before. The Court in Bostock interpreted Title VII’s prohibition on discrimination “because of sex” to encompass discrimination based on sexual orientation and gender identity. It held, “An employer who fires an individual merely for being gay or transgender violates Title VII.Bostock v. Clayton Cty., Georgia, 140 S. Ct. 1731, 1734 (2020). The Court reasoned that it is impossible for an employer to discriminate against employees based on sexual orientation without discriminating against them on the basis of sex. Id. at 1741. Justice Gorsuch provided the example of a man being fired because he was married to a man, whereas a woman would not have been fired for being married to a man. Id. Therefore, because men and women are treated differently, there exists sex discrimination in this scenario. Id.


 


At the end of his presidency, in January, Trump’s Justice Department issued a last-minute memo seeking to limit the scope of Bostock’s applicability. Thankfully, Biden both revoked the memo and explicitly instructed his administration to interpret Bostock broadly in his Executive Order. In adopting a broad construction of Bostock, the Executive Order says loudly that the Biden administration will consider discrimination on the basis sexual orientation and gender identity to be a form of sex discrimination, prohibited by Title VII. This is an encouraging development, but because it is an Executive Order rather than legislation, it leaves open the possibility that future presidents could take steps backward again, like Trump did.

 

This is where the Equality Act comes in. Instead of including protections for LGBTQ people under the umbrella of “sex discrimination,” the Equality Act would Amend the Civil Rights Act of 1964 to add “sexual orientation and gender identity” as their own bases for protection under the Act. Currently, these bases are race, color, religion, sex, and national origin. The Equality Act would replace the word, “sex,” from the Act with, “sex (including sexual orientation and gender identity).” The Civil Rights Act of 1964 is one of the greatest sources of protection for American workers, with Title VII of the Act prohibiting employment discrimination nationwide. The Equality Act would therefore expand these meaningful protections for American workers to explicitly encompass members of the LGBTQ community. 

 

It is important to pass federal protections for LGBTQ workers because currently, 27 states have no state-level laws prohibiting discrimination based on sexual orientation or gender identity.  Further, passing the Equality Act would ensure federal-level protection from discrimination even in the unfortunate case that we end up with another President who does not support LGBTQ workers. It is crucial that we do not leave this important civil rights issue up to the whims of a bigoted future President.

 

Thanks to decades of hard work by LGBTQ advocacy groups, the House of Representatives voted to pass the Equality Act on February 24, 2021. Hopefully the Senate will look past partisan divides and vote this Act into law swiftly.

 

Bryan Schwartz Law stands with LGBTQ workers. The firm has written about Title VII many times before. If you believe you have been discriminated against based on your sexual orientation or gender identity, please contact Bryan Schwartz Law.

Friday, January 29, 2021

California Supreme Court Expands Number of Workers Classified as Employees Rather Than Independent Contractors

The 2020 presidential election successfully ousted an administration and political movement that has sought to undermine workplace protections, and reaffirmed democracy and the rule of law.

But it also saw the overwhelming passage of Proposition 22 in California after gig employers spent a jaw-dropping $200,000,000+

(the most in California history) to write its own law, much to the dismay of worker advocates and to the detriment of gig economy workers. Proposition 22 exempts app-based rideshare and delivery com
panies from their responsibilities under landmark worker protection law A.B. 5 and the Supreme Court of California’s decision in Dynamex Operations W. v. Superior Court (2018) 4 Cal.5th 903, which classify drivers as employees.

Good news for workers came early in 2021: the California Supreme Court has determined that the Dynamex decision applies retroactively to cases that arose before Dynamex was decided in 2018. The decision is Vazquez v. Jan-Pro Financing International, Inc.

Dynamex established the “ABC test,” a three-part legal test that makes it more difficult for businesses to ignore worker protections by classifying them as independent contractors. Under the ABC Test, a business can classify a worker as an independent contractor only if the employer can show all three parts:

A)      The person is free from the control and direction of the hiring entity in connection with the performance of the work;

B)      The person performs work that is outside the usual course of the hiring entity’s business; and

C)      The person is customarily engaged in an independently established trade, occupation, or business of the same nature as that involved in the work performed.

If the business cannot prove all three of these parts, the worker is an employee. Unlike independent contractors, employees are guaranteed protections like sick leave, minimum wage, overtime pay, reimbursement for their expenses, health insurance, and the right to organize. Gig employers such as Uber, Lyft, Doordash, and Postmates hoped to avoid these legal obligations  to their workers by bankrolling Proposition 22—which is why its passage was such a stinging defeat for gig workers.

A three-judge panel of the Ninth Circuit Court of Appeals had already held that the ABC test applies retroactively in May 2019, but that did not end the debate. On rehearing, the Ninth Circuit decided to ask the California Supreme Court what it thought and withdrew its opinion. In a victory for workers, the California Supreme Court unanimously held on January 14, 2021, that the Dynamex decision should apply retroactively to cases arising before it was decided.

Judicial decisions like Dynamex usually apply retroactively, but the defendant here argued that Dynamex should be an exception because the ABC test was, in their view, a new rule. As such, according to the defendant, it would not be fair to apply Dynamex retroactively. The court disagreed, opining that decisions prior to Dynamex had put hiring entities on notice that the previous state of the law regarding independent contractor status was not firmly settled. To the contrary, the court stated that “fairness and policy considerations underlying our decision in Dynamex favor retroactive application,” because workers’ protections enable “them to provide at least minimally for themselves and their families and to accord them a modicum of dignity and self-respect.” If Dynamex were not applied retroactively, the court feared that many workers would be denied the intended protections of California law.

Though this is a victory, it is a limited one. Statutes of limitations already restrict the number of workers who may assert their rights as employees improperly misclassified as independent contractors. However, Proposition 22 does not apply retroactively, meaning that gig workers have a window in which to exercise their legal rights in light of this decision.

If you have wrongly classified as an independent contractor instead of an employee, contact Bryan Schwartz Law.