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Federal Court Rules Employers Can't Pay Women Less Than Men Based On Prior Salary

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It's National Equal Pay Day, a day designed by activists to call attention to the pay gap between men and women and efforts to close it. Just yesterday, the 9th Circuit Court of Appeals in California ruled in favor of a public school employee who sued after she discovered she was making less money than her male counterparts - a decision that could shape other gender pay cases. NPR's Yuki Noguchi reports.

YUKI NOGUCHI, BYLINE: Aileen Rizo had worked as a math teaching consultant for Fresno County for four years when she discovered a new male hire with less education had been offered $13,000 more than she was making. Rizo complained but was told the pay difference was justified based on her salary and previous jobs.

AILEEN RIZO: If you use prior salary, then you get women caught up in a cycle of low wages that we've been fighting for decades.

NOGUCHI: Last year, the 9th Circuit ruled against Rizo in a decision criticized by equal pay advocates. Rizo appealed, and yesterday the 9th Circuit reversed itself. In one of his final rulings, Judge Stephen Reinhardt wrote, quote, "the financial exploitation of working women embodied by the gender pay gap continues to be an embarrassing reality of our economy." Reinhardt died last month of a heart attack. Rizo, who is now running for California State Assembly, says the timing around Equal Pay Day and Reinhardt's death added emotional weight to the decision.

RIZO: The beautiful words that he penned in this opinion are very strong, and I hope that it will do him honor and justice to see this make a difference for many women's lives.

NOGUCHI: Rizo's case does not, however, settle the legal issues for the rest of the country. Other circuit courts have upheld an employer's right to use prior salary as a factor in setting pay. Further complicating matters, four states and several cities bar employers from asking about pay history. Dallas attorney Melissa Goodman represents employers in employment cases.

MELISSA GOODMAN: I think it has the potential to create a lot of confusion in that.

NOGUCHI: Nevertheless, Goodman says this case means employers will need to take another look at their pay practices.

GOODMAN: I do think the impact will be that employers need to think about, going forward, how they're going to consider setting salaries when they're hiring employees and also looking at their current employees. And are those salaries defensible right now?

NOGUCHI: Fresno's Office of Education did not respond to requests seeking comment. Goodman says the case could still be appealed to the Supreme Court. Yuki Noguchi, NPR News, Washington. Transcript provided by NPR, Copyright NPR.

Yuki Noguchi is a correspondent on the Business Desk based out of NPR's headquarters in Washington, DC. Since joining NPR in 2008, she's covered a range of business and economic news, with a special focus on the workplace — anything that affects how and why we work. In recent years she has covered the rise of the contract workforce, the #MeToo movement, the Great Recession, and the subprime housing crisis. In 2011, she covered the earthquake and tsunami in her parents' native Japan. Her coverage of the impact of opioids on workers and their families won a 2019 Gracie Award and received First Place and Best In Show in the radio category from the National Headliner Awards. She also loves featuring offbeat topics, and has eaten insects in service of journalism.
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