Basing pay on salary history is one factor that can perpetuate the pay gap, precisely because women are typically paid less than men. But many people don’t understand the domino effect that pay inequity can have on economic security Rizo’s case sheds light on this important yet often unrecognized factor that contributes to the pay gap.
(Formerly Rizo v. Fresno County Office of Education)
On July 2, 2020, the U.S. Supreme Court declined to hear a challenge to the Ninth Circuit Court decision that prohibited reliance on employee’s salary history to justify pay disparities. As such the Ninth Circuit’s February opinion stands; it held that using prior salary alone, as a “factor other than sex,” or in combination with other factors cannot justify a wage differential between employees. Only job-related factors may serve as affirmative defenses to Equal Pay Act claims.
AAUW is proud to fight for Aileen Rizo and others by advocating for pay equity and fairness in compensation and benefits as a means to achieve economic self-sufficiency for all women.
Aileen Rizo on AAUW's commitment to the fight for fair pay
Pay equity is a matter of simple fairness. Yet in 2016 women who worked full time were paid just 80 cents for every dollar paid to men. When the gender pay gap is broken down across different populations, the numbers can become even more stark. This case highlights a significant underlying factor that contributes to the pay gap: employers’ practice of relying on an employee’s salary history to set new salary levels.
The Story behind the Rizo Case
Aileen Rizo worked as a math consultant for the Fresno County Office of Education (FCOE) in Fresno, California, training instructors in new ways of teaching math. Rizo was hired by the FCOE in 2009 after earning a master’s degree and teaching for 13 years. She and her family moved from Arizona to California for her new position.
In 2012, Rizo says, a male colleague who had recently been hired mentioned that he had been placed at step nine on the county’s 10-step pay scale. Rizo was shocked — she had been placed at step one on the scale when she began her job, even though she understood that she had more experience and seniority than her male colleague. Rizo says that after filing an internal complaint, she was told that the FCOE based new employees’ salaries on just one factor: the employee’s salary history. On the basis of the county’s policy it seemed that Rizo’s less-experienced colleague was given a higher salary only because he had been paid more at his previous job than she had been paid at her previous job.
Rizo eventually filed suit under the Equal Pay Act and California’s sex discrimination statutes. The case was filed in the U.S District Court for the Eastern District of California in 2014 and moved through the judicial system. In April 2017 the U.S. Court of Appeals for the Ninth Circuit handed down an unfavorable decision in Rizo’s case. A three-judge panel held that using prior salary alone to calculate current wages can be permissible under the Equal Pay Act as a “factor other than sex” if the defendant shows that its use of prior salary was reasonable and effectuated a business policy.
Rizo argued that using prior salary alone to calculate current wages perpetuates existing pay disparities and undermines the legislative intent of the Equal Pay Act, which is to address pay inequity based on sex.
Why Rizo Matters
This unfavorable ruling magnified the need for strong state and federal legislation that eliminates the practice of using prior salary alone to calculate current wages. Federal legislation, like the Paycheck Fairness Act, currently pending in Congress, addresses the “factor other than sex” affirmative defense of employers by requiring them to articulate a necessary business justification for pay differentials. The legislation also prohibits reliance on salary history during hiring. This legislation will help close the gender pay gap and promote economic security for women.
In the absence of such federal legislation, women like Aileen Rizo and AAUW continue to fight for equal pay in the states, through a broad range of research, policy, and legal advocacy. AAUW joined an amicus brief in support of Rizo’s petition for rehearing en banc — in front of all the judges of a court rather than only a selected panel — and urged the Ninth Circuit to reconsider. In August 2017 the Ninth Circuit granted a petition for rehearing en banc and it was reheard with the full panel in December 2017.
On April 9, 2018, the Ninth Circuit held that using prior salary alone, as a “factor other than sex,” or in combination with other factors cannot justify a wage differential, further reasoning that this would allow employers to profit on this inequity and perpetuate a gender wage gap in direct contrast with the intent of the Equal Pay Act of 1963.
On August 30, 2018, Fresno County Superintendent of Schools filed a petition for appeal with the Supreme Court of the United States to challenge the decision reached by the U.S. Court of Appeals for the Ninth Circuit, which found in favor of Aileen holding that using prior salary alone, as a “factor other than sex,” or in combination with other factors cannot justify a wage differential under the Equal Pay Act.
On February 25, 2019, the Supreme Court vacated and remanded the Ninth Circuit’s decision, which means that they determined that the Ninth Circuit’s decision was flawed and must be sent back to the appellate court for additional review. The Court arrived at this conclusion without reviewing the merits of the equal pay case, focusing solely on the second issue presented before the Court, which was whether a federal court can count the vote of a judge who dies before the decision is issued. This was relevant because the judge that authored the Ninth Circuit decision died on March 29, 2018, although the vote was taken and opinion authored prior to his death.
Although that decision has been vacated by the Supreme Court, AAUW’s commitment to this case is unwavering. We will continue to support Rizo through our legal case-support program as her case moves through the remand process.