Developments in Equal Pay Litigation

42 | Developments in Equal Pay Litigation © 2021 Seyfarth Shaw LLP Turning to the arbitration provision itself, the court held that the provision’s limitation of remedies would prevent plaintiff from obtaining some of the remedies available to her under her statutory claims, including the right to backpay, front pay, reinstatement, or punitive damages under California’s Fair Pay Act. 343 The arbitration provision stated that the arbitrators would have no authority to substitute their judgment or override determinations of the firm’s partnership or Executive Committee . 344 The court held that this would constrain the relief the arbitration could provide and would prevent the arbitrators from providing remedies that would otherwise be available in a court of law. 345 In addition, the court held that the provisions that required plaintiff to pay half the costs of arbitration and her own attorneys’ fees, and the confidentiality provision, rendered the agreement unconscionable and therefore void under California law . 346 3. Proving An “Establishment” The EPA requires an employee to compare their wages against other employees within the same physical place of business in which they work. According to regulations issued by the EEOC, a single establishment “refers to a distinct physical place of business” within a company. “[E]ach physically separate place of business is ordinarily considered a separate establishment” under the EPA. The regulations contrast this with the entire business, or “enterprise,” which “may include several separate places of business. ” 347 Courts presume that multiple offices are not a “single establishment” unless unusual circumstances are demonstrated . 348 Not surprisingly, defining the scope of the establishment for purposes of comparing salaries and wages is a frequently contested issue in EPA litigation. For example, in In Moazzaz v. Metlife, Inc. , 349 a Senior Vice President and Chief Administrative Officer and Interim Global Head of Digital Strategy alleged that she was paid less than male employees with similar-level positions, such as the Head of Japan Operations and Europe, Middle East and Africa Chief Financial Officer . 350 The employer argued that those positions were too geographically separate from plaintiff’s position and therefore not within the same “establishment” as defined by the EPA. However, the court held that plaintiff had alleged sufficient facts at the pleading stage to allow the case to proceed based on those comparators. The court noted that “[t]he foreign comparators all appear to be members of MetLife's leadership team,” who reported directly to plaintiff and other centralized high-level officers. The court concluded that “[i]t is thus improbable that foreign [employer] personnel, instead of, say, . . . the Head of Human Resources for Global Technology and Operations, would have been responsible for the Head of Asia IT's specific salary.” 351 343 Ramos , 239 Cal Rptr. 3d at 696-97. 344 Id. at 696. 345 Id. 346 Id. at 704. 347 29 C.F.R. §1620.9(a). 348 See Kassman v. KPMG LLP , 416 F. Supp. 3d 252, 287 (S.D.N.Y. 2018) (finding that pay and promotion decisions were not sufficiently “centralized” to amount to “unusual circumstances” warranting a finding that the many offices and practice areas qualify as a single “establishment” under the EPA even because “although [defendant] set generally applicable guidelines, individual pay and promotion decisions were left to the discretion of local practice area leaders,” which decisions were “reviewed by firm leadership on an aggregate basis against budget”); Meeks v. Computer Assocs. Int'l , 15 F.3d 1013, 1017 (11th Cir. 1994) (holding that evidence did not “demonstrate the level of centralization necessary to justify treating all of the company's technical writers as working at a single establishment” where “the specific salary to be offered a job applicant is determined by the local supervisor”). 349 Moazzaz v. Metlife, Inc. , No. 19-CV-10531 (JPO), 2021 WL 827648 (S.D.N.Y. Mar. 4, 2021). 350 Id. at *5. 351 Id. See also O’Reilly v. Daugherty Sys., Inc. , No. 4:18-CV-1283 SRC, 2020 WL 1557174 (E.D. Mo. Mar. 31, 2020) (authorizing collective action notice to be sent to all female employees in two job categories in multiple offices across the country on the strength of the plaintiffs’ allegations that employees “were all subject to the same compensation policies and practices, which the two owners of the company implemented for all employees regardless of job title, salary grade, or geographic location”).