Derouin v. Louis Allis Div.

• Decision Date: 06 September 1984
• Docket Number: No. 81-C-270.,81-C-270.
• Citation: 618 F. Supp. 221
• Parties: Gwendolyne DEROUIN and Aurelia Luedke, Plaintiffs, v. LOUIS ALLIS DIVISION, a DIVISION OF LITTON INDUSTRIAL PRODUCTS, INC., a foreign corporation, Defendant.
• Court: U.S. District Court — Eastern District of Wisconsin

618 F. Supp. 221

Gwendolyne DEROUIN and Aurelia Luedke, Plaintiffs, v. LOUIS ALLIS DIVISION, a DIVISION OF LITTON INDUSTRIAL PRODUCTS, INC., a foreign corporation, Defendant.

No. 81-C-270.

United States District Court, E.D. Wisconsin.

September 6, 1984.

Thomas D. Jacobs, Gray & End, Milwaukee, Wis., for plaintiffs.

Dennis M. White, Madison, Wis., for defendant.

DECISION AND ORDER

WARREN, District Judge.

Plaintiff employees have brought this action under the Equal Pay Act, 29 U.S.C. § 206(d), and Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e-2, against the defendant employer. The plaintiffs allege that the defendant has discriminated upon the basis of sex in the payment of plaintiffs' salaries while they were supervisors at Louis Allis. Plaintiffs further claim that the pension benefits which they have accumulated are based upon unlawfully discriminatory salaries.

The parties have stipulated that the plaintiffs performed "equal work" within the meaning of the Equal Pay Act in comparison to male supervisors within their respective departments. The record further shows that the plaintiffs did not receive the same wages as male supervisors in their respective departments. Thus, there are no material facts in dispute, and both parties have moved for summary judgment. Defendant has moved for summary judgment as to the entire matter, and the plaintiffs have moved for summary judgment as to a finding of discrimination.

I. BACKGROUND

Plaintiff Gwendolyn Derouin began work at the Milwaukee plant of Louis Allis as a technical clerk junior (essentially a secretarial position) on December 1, 1967. On February 17, 1975, she was promoted to dispatcher, and on April 12, 1976, she was promoted to the position of Supervisor II in Department 1280. She became the first female supervisor in the manufacturing operations of Louis Allis.

Plaintiff Aurelia Luedke was hired by Louis Allis as a secretary on February 6, 1962. She held the job of clerk senior from March 1, 1968, until November 14, 1978. On the latter date, she was promoted to the position of Supervisor III in Department 1492, and became the second female supervisor at Louis Allis. Plaintiff Luedke officially retired in September, 1981, and is currently on pension from Louis Allis.

Plaintiffs filed their complaint in this action on March 20, 1981, alleging Equal Pay Act violations. On April 13, 1981, plaintiff Derouin filed a charge with the Equal Employment Opportunity Commission (EEOC), and plaintiff Luedke did the same on April 15, 1981. The EEOC issued Right to Sue Notices to the plaintiffs on May 13, 1981, and April 17, 1981, respectively. On July 14, 1981, plaintiffs filed an amended complaint setting forth a Title VII cause of action in addition to their claims under the Equal Pay Act. Plaintiffs' theory of liability and operative facts are the same under both statutes.

II. DEFENDANT'S SALARY POLICY: POLICY IR-2

The plaintiffs have alleged facts which defendant has not contested and which demonstrate substantial disparities among the salaries paid to supervisors in the plaintiffs' respective departments. The salary disparities are a result of defendant's Policy IR-2, which states that a promotional salary increase should be within a specified percentage (10%-20%) of the employee's present salary. Policy IR-2 also requires that any "merit" increase in salary should range between 5% and 10% of that employee's current base salary. In other words, the salary and merit increases paid to a supervisor would be largely dependent upon that employee's salary in his previous position. There is, however, a specified minimum monthly salary, as well as a midpoint and maximum salary.

As a result of Policy IR-2, not all supervisors are paid alike: those who are promoted from lower paying positions will receive lower salaries and merit increases than those who are promoted from higher paying positions. Plaintiffs contend that this payment scheme perpetuates the low salaries paid for traditional "women's jobs", such as those from which they were promoted. Defendant contends that the plan is a bona fide merit plan which follows structured guidelines and which applies to men and women alike. The Court must decide whether the plan violates the Equal Pay Act and/or Title VII.

III. STATUTE OF LIMITATIONS

Before considering the merits of plaintiffs' claims, the Court must address defendant's argument that plaintiffs' claims are barred by the applicable statutes of limitation. Under 29 U.S.C. § 255(a), a claim under the Equal Pay Act must be commenced within two years after the cause of action accrued, or within three years after the cause of action accrued if the alleged violation was willful. Pursuant to 42 U.S.C. § 2000e-5(e), the case must be commenced within 300 days of the cause of action if a charge is filed with a state agency.

Since the complaint in this case was filed on March 25, 1981, defendant contends that all of the plaintiffs' claims must be dismissed. Defendant states that the low salaries of which plaintiffs complain are based upon their entering salaries upon promotion in 1976 and 1978, both events having occurred more than two years before the complaint was filed.¹

At the outset, the Court notes that the mere fact that plaintiffs continued to be employed by defendant is, without more, insufficient to sustain a cause of action for employment discrimination. Delaware State College v. Ricks, 449 U.S. 250, 257, 101 S.Ct. 498, 503, 66 L.Ed.2d 431 (1980). However, the cause of action is prolonged even where the alleged act of discrimination is beyond the statute of limitations if the initial act continues to manifest itself throughout the period of employment. Jenkins v. Home Insurance Co., 635 F.2d 310 (4th Cir.1980). In particular, the act of paying a discriminatorily low wage occurs not only when the pay level is set, but continues as long as the discriminatory pay differential continues. Id.; Satz v. ITT Financial Corp., 619 F.2d 738, 743 (8th Cir.1980).

From these cases, it follows that the plaintiffs' cause of action would continue as long as they were employed and/or receiving pension benefits based upon a salary that was set through discriminatory procedures. Since the differential in pay has been a continuing one, the respective statutes of limitation are no bar to plaintiffs' claims.

IV. PLAINTIFFS' EQUAL PAY ACT AND TITLE VII CLAIMS

Section 2000e-2(a)(2) of Title 42, United States Code states:

(a) Employers. It shall be an unlawful employment practice for an employer— ... (2) to limit, segregate, or classify his employees or applicants for employment in any way which would deprive or tend to deprive any individual of employment opportunities or otherwise adversely affect his status as an employee, because of such individual's race, color, religion, sex, or national origin.

Specific prohibitions pertaining to payment differentials between employees of different sexes are covered in 29 U.S.C. § 206(d)(1):

(d)(1) No employer having employees subject to any provisions of this section shall discriminate, within any establishment in which such employees are employed, between employees on the basis of sex by paying wages to employees in such establishment at a rate less than the rate at which he pays wages to employees of the opposite sex in such establishment for equal work on jobs the performance of which requires equal skill, effort, and responsibility, and which are performed under similar working conditions, except where such payment is made pursuant to (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: Provided, That an employer who is paying a wage rate differential in violation of this subsection shall not, in order to comply with the provisions of this subsection reduce the wage rate of any employee.

As such, the Equal Pay Act precludes unequal pay for equal work, unless the payment falls under one of the four enumerated exceptions.

The burdens of proof in a case under Title VII are essentially the same as those in a case under the Equal Pay Act. The plaintiff has the burden of making a prima facie case of discrimination. Texas Dept. of Community Affairs v. Burdine, 450 U.S. 248, 252-53, 101 S.Ct. 1089, 1093, 67 L.Ed.2d 207 (1981); Johnson v. Uncle Ben's, 628 F.2d 419, 421 (5th Cir.1980). A prima facie case can be established by proof of "policies or practices which are neutral on their face and in intent but that nonetheless discriminate in effect against a particular group." International Brotherhood of Teamsters v. United States, 431 U.S. 324, 349, 97 S.Ct. 1843, 1861, 52 L.Ed.2d 396 (1977). In this case, plaintiffs burden is to show that they were paid lower wages than male employees while performing substantially the same work.

Once the plaintiff has proved his prima facie case, the burden shifts to the defendant to "articulate some legitimate, nondiscriminatory reason" for the unequal treatment. Burdine, 450 U.S. at 253, 101 S.Ct. at 1093. One of the four exceptions specified under the Equal Pay Act would justify the disparate treatment. Corning Glass Works v. Brennan, 417 U.S. 188, 196, 94 S.Ct. 2223, 2229, 41 L.Ed.2d 1 (1974). If the defendant meets his burden, the plaintiff must then prove by a preponderance of the evidence that the reasons offered by the defendant are not legitimate, but serve merely as a cover for a policy of discrimination. Burdine, 450 U.S. at 253, 101 S.Ct. at 1093.

The plaintiffs have established their prima facie case. First, the parties have stipulated that supervisors in the respective departments do "equal work". Second, the plaintiffs have submitted unrebutted evidence that payment disparities exist between the supervisors within their respective departments. While certain male supervisors are paid lower salaries than each plaintiff, the facts as...