Monthly Archive: April 2016

Apr 18

Equal Pay for Equal Play

By Mary Cunningham.

On April 12, the U.S. observed Equal Pay Day—a day created to discuss the pay gap between men and women. Equal Pay Day received special attention this year because of its temporal proximity to the day the U.S. Women’s National Soccer Team (USWNT), represented by five of its best players, filed a complaint with the Equal Employment Opportunity Commission against the U.S. Soccer Federation alleging wage discrimination. The U.S. Soccer Federation is the governing body of soccer in all its forms in the United States. U.S. Soccer also determines compensation for members of both the U.S. men’s national soccer team (USMNT) and the women’s national team.

The women’s team asserts that the players for the men’s team are paid almost four times more than the women’s players. Their complaint notes, for example, that the men are paid no less than $5,000 for an exhibition game, and as much as $22,625 for winning the game. In contrast, the women are paid $3,600 to play an exhibition, and are paid only $4,950 for a similar win.  The team bonus the women received after winning the 2015 World Cup was also several million dollars short of the team bonus the men received in 2014 after being eliminated in the second stage of the tournament. This pay disparity seems unjustified particularly in light of USWNT’s claim that they bring in more revenue than USMNT.

U.S. Soccer disagrees with USWNT on revenue, arguing that USWNT is drawing from a particularly successful year to make broad conclusions. The federation also notes that FIFA tournament payout for men’s soccer is dramatically higher than payout for women’s soccer. They argue the difference in payout primarily explains the pay gap for the men’s and women’s World Cups.

For a wage discrimination claim under Title VII, USWNT has the difficult task of showing proof of U.S. Soccer’s discriminatory intent. To establish a prima facie case for wage discrimination under the Equal Pay Act (EPA), they must show that the women’s and men’s players perform equal work, which involves substantially equal skill, effort, and responsibility in similar conditions. If this standard is met, the burden shifts to U.S. Soccer (the employer) to prove that the difference in pay is justified by one of four defenses: “(i) a seniority system; (ii) a merit system; (iii) a system which measures earnings by quantity or quality of production; or (iv) a differential based on any other factor other than sex.”

The fourth defense—“factor other than sex”—has been broadly interpreted. For example, the Seventh and Eighth Circuits have held that “acceptable business purposes” arising from “factor other than sex” does not need to be a reasonable business purpose to constitute a defense.  Essentially, if U.S. Soccer is correct and the men’s team produces significantly more revenue than the women’s, paying the women less may be acceptable to a court unwilling to adjudicate the wisdom of business decisions. U.S. Soccer, however, would likely avoid simply arguing women’s pay is justified because “market forces,” such as the professional soccer job market, have determined that women are paid less than men. This argument seems problematic because, if adopted, it frustrates the EPA’s goal of overcoming historic sex-based wage discrimination created by market forces.

At this point, a likely strategy for USWNT involves tackling wage issues during their collective bargaining negotiations to avoid what would be an interesting, but tricky, legal battle.

Apr 12

Friedrichs v. California Teachers Association

By Ross Pollack.

On March 29, 2016, the Supreme Court issued a divided 4-4 opinion in Friedrichs v. California Teachers Association, thus upholding the decision of the Ninth Circuit Court of Appeals. The one sentence opinion belies the importance of the case, which only two months earlier appeared as though it would nearly certainly cripple public sector unions’ ability to collect funds. At issue in the case was whether a public sector union could charge agency fees (the equivalent of Union Dues) to employees who elected not to join the Union. The teachers who brought the case argued compulsory agency fees violated their first amendment rights to use money as free speech because the Union might spend the money on political or ideological causes the employees did not support. In its 1977 decision, in Abood v. Detroit Board of Education, the Supreme Court ruled that compulsory agency fees were constitutional. Following this precedent in Friedrichs, the Ninth Circuit found that the Union was allowed to charge compulsory agency fees. Since the Supreme Court did not issue a majority opinion, that ruling and the Abood precedent stand.

However, the outcome in Friedrichs does not mean the debate over the legality of compulsory agency fees has been resolved. The two previous Supreme Court cases illustrated that several Justices would like to change the current precedent. In 2012, writing for the majority opinion in Knox v. Service Employees International Union, Local 1000, Justice Alito suggested that with regard to compulsory agency fees, “our prior decisions approach, if they do not cross, the limit of what the First Amendment can tolerate.” Next, in the 2014 Harris v. Quinn decision, Justice Alito used even stronger language to voice opposition to the precedent on agency fees: “Abood failed to appreciate the difference between the core union speech involuntarily subsidized by dissenting public-sector employees and the core union speech involuntarily funded by their counterparts in the private sector.” Union opposition groups took these decisions as a signal that the time was ripe to find a case that directly challenged the Abood precedent on First Amendment grounds.

Friedrichs became that case. The Supreme Court granted certiorari to hear arguments on whether compulsory agency fees violate the free speech rights of non-member public employees. Justice Scalia was considered to be the swing vote in this case until reports emerged that the questions he asked during oral arguments indicated he did not support the Abood precedent. The New York Times even ran the headline, “Supreme Court Seems Poised to Deal Unions a Major Setback.” However, after Justice Scalia’s sudden passing in February, the remaining justices were left deadlocked on the issue. Rather than let the case sit indefinitely until a new justice was appointed, the Court issued a divided 4-4 opinion, which by default lets the Abood precedent stand.

However, the issues of whether compulsory agency fees are constitutional has not been definitively settled. In confirmation hearings for the new justice, the public should expect to hear Senators asking questions that allude to this first amendment issue. Also, expect a case with similar facts to arrive on the Supreme Court’s docket once a new justice is appointed.

Apr 04

TYSON FOODS, INC. v. BOUAPHAKEO

By Courtney Sokol.

On March 22, in Tyson Foods, Inc. v. Bouaphakeo, the U.S. Supreme Court, in a 6-2 decision, upheld an Eighth Circuit ruling that certified a group of workers at Tyson Foods as a class under both a Rule 23(B)(3) class action and a Fair Labor Standards Act of 1938 (FLSA) collective action. Tyson Foods did not pay its employees for time spent “donning and doffing” necessary protective gear. The employees argued that Tyson Foods violated FLSA and the Iowa Wage Payment Collection Law by not paying appropriate compensation for time spent putting on and taking off the protective clothing at the beginning and end of the day and lunch break. While the central issues addressed by the Court address certification of a class with non-identical members, of which many were uninjured, the decision offers broader implications for the strength of worker protections.

Delivering the opinion of the Court, Justice Kennedy noted the grueling and dangerous conditions that Tyson’s workers experienced along with the necessity of such gear. Until 1998, the workers were paid under a system called “gang-time,” where employees were compensated for time spent only at their workstations. This time did not include when they were required to put on or take off protective gear. In response to a federal-court injunction, Tyson in 1998, began to pay all employees for an additional 4-minute period called “K-code time.” The four-minute period is the time estimated by Tyson for how long employees needed to put on their gear. However, in 2007, Tyson stopped K-code time, and instead only paid some employees beyond their gang-time wages for time spent dressing and undressing.

In response to this change, the employees filed suit in the United States District Court for the Northern District of Iowa, alleging FLSA violations. FLSA requires that a covered employee who works more than 40 hours a week receive excess time worked “at a rate not less than one and one-half times the regular rate at which [the employee] is employed.” 29 U.S.C. §207(a). Additionally, FLSA requires employers to pay employees for activities which are integral and indispensable to their regular work, even if the work does not occur at the work station.

Here, the employees argued that putting on and taking off their protective gear were integral and indispensable to their hazardous work, and therefore, compensation for such is required by FLSA. The employees raised the same claim under the Iowa Wage Payment Collection Law, which includes FLSA mandated overtime.

At trial, the employees had to prove that they worked 40 hours or more per week in order to qualify for FLSA overtime. Respondents proposed to bifurcate proceedings by requesting that the District Court address first, whether the time spent preparing their protective gear was compensable under FLSA and how long the activity took on average; and second, a statistical methodology be used to determine how much each employee would recover.

Tyson Foods did not move for a hearing regarding either of the above issues raised by the employees, but instead challenged the class certification under FRCP Rule 23(B)(3) and FLSA collective action. Tyson Foods argued that the varying amounts of time it took employees to don and doff different protective equipment made the lawsuit too speculative for class-wide recovery.

The Court turned to its decision in Anderson v. Mt. Clemens to explain that when employers violate their statutory duty to keep proper records, which prevents employees from establishing how much time they spent doing uncompensated work, the “remedial nature of [FLSA] and the great public policy which it embodies . . . militate against making” the burden of proving uncompensated work “an impossible hurdle for employee[s].”

The court held that the class members were joined under a common question, which satisfies the requirements for a class-action suit irrespective of differences among the members. Although the case was decided on procedural grounds, Kennedy’s majority opinion put great emphasis on the danger of the Respondent’s profession paired with the necessity of the protective gear. In evoking the remedial nature of FLSA, the Court is seemingly united behind pro-labor sentiment.