988 F.2d 1564 (11th Cir. 1993), 91-4160, E.E.O.C. v. Reichhold Chemicals, Inc.

Docket Nº:91-4160.
Citation:988 F.2d 1564
Party Name:EQUAL EMPLOYMENT OPPORTUNITY COMMISSION, Plaintiff-Appellant, Carolyn Smith, Intervenor, v. REICHHOLD CHEMICALS, INC., Defendant-Appellee.
Case Date:April 26, 1993
Court:United States Courts of Appeals, Court of Appeals for the Eleventh Circuit

Page 1564

988 F.2d 1564 (11th Cir. 1993)


Carolyn Smith, Intervenor,


REICHHOLD CHEMICALS, INC., Defendant-Appellee.

No. 91-4160.

United States Court of Appeals, Eleventh Circuit

April 26, 1993

Page 1565

Stanley Kiszkiel, Miami Dist. Office, Miami, FL, and Paul D. Ramshaw, U.S. E.E.O.C., Washington, DC, for E.E.O.C.

Michael W. Johnston, William A. Clineburg, Jr., King & Spalding, Atlanta, GA, for defendant-appellee.

Appeal from the United States District Court for the Northern District of Florida.

Before KRAVITCH and ANDERSON, Circuit Judges, and HILL, Senior Circuit Judge.

KRAVITCH, Circuit Judge:

The Equal Employment Opportunity Commission (EEOC) appeals a district court order awarding attorney's fees to Reichhold Chemicals, Inc. (RCI) as the prevailing party in a Title VII action brought by the EEOC. The original complaint alleged that RCI had violated Title VII by paying lower wages to a female employee, Carolyn Smith, than to a similarly situated male

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employee. 1 The EEOC later amended its complaint to include a charge of retaliation under Title VII and the Equal Pay Act, claiming that RCI had taken punitive measures against Ms. Smith for exercising her rights.

The case was tried before a district judge. At the close of EEOC's case, RCI moved for an involuntary dismissal pursuant to Rule 41(b) of the Federal Rules of Civil Procedure. The court granted RCI's motion and ruled sua sponte that RCI was entitled to an award of attorney's fees. The EEOC moved to amend the order granting fees and the district court denied the motion. The EEOC now appeals the attorney's fees award. For the reasons discussed below, we REVERSE.


In July 1981, Carolyn Smith was hired by Alton Sermon, an RCI division controller, for the position of staff accountant at RCI's division office located in Pensacola, Florida. Smith was hired shortly after she completed her college education and earned an associate's degree in business administration and a bachelor's degree in accounting. At the time she was hired, Smith had some experience in bookkeeping and accounting and had managed a one-person credit union office for six years. Sermon offered Smith an initial salary of $15,000, the market rate for a recent graduate with Smith's skills.

Smith's duties as a staff accountant included maintaining a general ledger for the division's stumpwoods operations, preparing payroll controls for hourly wage employees and inventory controls, assisting in compiling the annual division budget, drafting monthly production and government reports, and occasionally assuming Sermon's position in his absence.

The EEOC's claim was based primarily on a comparison between Smith and a male employee, Dennis Atchison. Atchison holds two associate's degrees, one in accounting and business, and the other in literature and art, as well as a bachelor of science degree in business management. Following his college graduation, Atchison worked for the Milliken Company, a textile manufacturer, where he held various management positions. At Milliken, Atchison was earning a salary of approximately $22,000 plus a yearly bonus and RCI offered him $24,996 to change companies. In December 1981, Atchison began working as a plant accountant at RCI's Telogia, Florida plant. His duties included accounting tasks and labor relations responsibilities. He and his clerk were responsible for accounts payable at the plant and also prepared the annual plant budget and various reports. Smith testified that approximately half of Atchison's time was spent on accounting duties similar to those that she performed. Atchison testified that only 30% of his time was occupied with accounting duties and 70% of his time was allocated to his labor relations tasks, including interpreting and administering the collective bargaining agreement and resolving grievances.

Smith contends that she was disturbed by the fact that she was earning less than Atchison when she had more responsibility. In early 1982 she repeatedly complained of the pay disparity to Alton Sermon, her supervisor. She testified that on one occasion, he replied that she was paid less because Atchison was the head of a household and thus required a greater salary. Smith stated that she informed Sermon that this reason was discriminatory. Smith never reported Sermon's comment to anyone

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at RCI nor did she have a contemporaneous written record of the statement.

When Smith and Atchison were hired, RCI did not have a centralized salary system. In December 1982, RCI began to implement the Hay system, which evaluates jobs and assigns each job a grade level. All employees were required to complete position questionnaires detailing their duties and responsibilities, which were reviewed by their supervisors. RCI management then chose some positions as benchmarks for evaluation and grading. A committee evaluated the benchmark questionnaires; quantified the degree of knowledge, problem-solving and accountability that the position required; and assigned a grade level to each benchmark position. The remaining positions were graded by comparing them to a similar benchmark position.

Each grade was given a desired salary range. The employee's actual salary was compared to the midpoint of their grade's salary range and described in terms of a percentage of the midpoint salary. This figure was referred to as a compa-ratio and the desired compa-ratio was between 80 and 120% of the midpoint of the salary range. Thus, if the survey showed that an employee's pay was less than 80% of the midpoint, it indicated that the employee should be awarded larger and more frequent raises.

Atchison's job was selected as the benchmark position for the other plant accountants, including Smith. Atchison's position was assigned grade 11 and Smith's job was compared to his in order to determine her grade level. She also was assessed as a grade 11. Her compa-ratio was 67.5%. Atchison's compa-ratio before his increase in October 1983 was 89.7%.

Smith remained a staff accountant until April 1983 when she was promoted to Assistant Division Controller, a grade 14 position. This position involved increased supervisional responsibility and providing information and assistance to nine plant accountants to enable them to gather and relay data to the division.

Atchison remained a plant accountant until the summer of 1983 when he moved to the Newport Division Office in Pensacola, where Smith worked. He became the Division Budget Coordinator, a grade 13 position. Atchison's new job consisted of assembling manufacturing budgets and preparing sales forecasts for the entire division. Atchison also implemented a computer program to allow him to track important statistics. Smith testified that she helped Atchison with the budget and the formulation of procedures for formatting the budget.

Smith further testified that at this point, Atchison was earning more income than she was because her salary still had not reached his starting salary of approximately $25,000. She further testified that this disparity led her to file an EEOC complaint in June 1984, alleging sex-based discrimination. Beginning the year before her charge was filed, Smith received a 15% salary increase every six months. These increases, however, did not increase her salary to Atchison's level for the period of April 1983 to June 1984.

In April 1985, both Atchison and Smith became group accountants, responsible for division duties and addressing the needs of the plant accountants. During this period of time, the two employees were performing exactly the same jobs. Smith was given raises such that her salary exceeded Atchison's during this period. In late 1985, Atchison returned to a plant in an accountant position and Smith was given the position of division accountant.

Smith's performance appraisals from the time she was hired in 1981 until 1985 stated that her performance was "commendable," the second highest rating. In 1986...

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