Could Ability-Based Wages Close the Gender Pay Gap?

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How does your boss decide what to pay you? Is it based on your position, experience, or rain-making record? What about your core ability? An academic report suggests that income inequality and the gender pay gap could be reduced if people were paid based on their traits and abilities, rather than their job title.

Study Finds Income Inequality Thrives in Small, Professional Businesses

In July 2019, the Oxford Quarterly Journal of Economics published a new study about income inequality across the country. The study sorted through tax data for 11 million companies tracking the income of their owners and employees. It found that income inequality, which has been on the rise for over 40 years, coincides with the decline of traditional corporations and the increase in pass-through entities like S-Corporations and Limited Liability Corporations (LLCs).

S-Corporations are the favorite structure of small professional businesses focused on regional operations, like law offices, financial managers, and medical offices. In those businesses, owners and executives are far more likely to be part of the top 1 percent of earners, including lawyers, doctors, and wealth managers.

Productivity and Ability Doesn’t Justify Pay Gap

The study asked the question of whether these owners’ skills justified the difference in what they were paid. It found that the range of worker productivity is much smaller than the standard pay gap. Managers and rain-makers were approximately 50% more productive than the average worker at the company. But they were paid far higher.

Income distribution according to the study says the richest Americans earn 30% of all income, and the bottom 10% earn just 1% of the money. However, ability-based wages would narrow that spread and distribute wealth more equally across the population. When income is based on each employee’s education, IQ, age, and personality traits, the top 10% earned 19% of income and the bottom 10% earned 3%. The biggest difference came in the richest category.

Ability-Based Wages Could Help Close the Gender Pay Gap

It turns out, women in particular could benefit from the adaptation of ability-based wages. That is because women are distinctly underrepresented at the management and executive levels of business. In fact, this difference in job title makes up most of the gender pay gap. When the measurement of median income is limited by the same job and qualifications, the most recent data shows only a $0.05 difference. But an uncontrolled measurement shows that women earn only $0.79 for every $1 paid to their male counterparts. This demonstrates the systemic gender discrimination in promotion and hiring at the higher levels. For example, according to Payscale.com, by age 45, 38% of men had been promoted to a manager or supervisor level. By the same age, only 30% of women had reached the same level. The difference is even more stark at the executive level, which makes up 8% of men over age 45, but only 3% of women ever become leaders in their companies. This so-called “opportunity gap” shows that women tend to remain in lower-level positions throughout their careers (59% never move past the individual contributor level). Under the current model this equates to lower-paid positions, regardless of the women’s actual ability or productivity.

Equal Pay Act and Title VII Help Women Fight for Ability-Based Pay

All the statistics in the world won’t convince the owners of small professional businesses to change their pay model. But a well-argued complaint to the Equal Employment Opportunity Commission or in federal court might. Title VII of the federal Civil Rights Act and the Equal Pay Act both prohibit gender discrimination in wages. These laws, and their state equivalents give employees the tools they need to affect change at work and be sure they are paid what they deserve. If you believe you are paid less than your male counterparts for substantially similar work, you may be able to use an Equal Pay Act complaint to negotiate a different way to measure employee worth, and get properly compensated for your productivity and hard work.

At Eisenberg & Baum, LLP, our employment discrimination attorneys know how to use statistics like the Oxford report to prove your wage discrimination case. If you believe that you have been discriminated against as a woman in your small business, we will review your situation and help you plan a strategy to help you close the gender gap. Contact Eisenberg & Baum, LLP, today to talk to an employment discrimination attorney.

Survivors of Childhood Sexual Assault Face Reliving Trauma Online

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Childhood sexual assault is a crime that carries a lifetime of consequences for its victims. The physical, mental, and emotional trauma can affect the survivors of these crimes on into adulthood. Now, as the first generation of these survivors are coming of age, they find themselves facing a new challenge: being forced to relive their trauma when images and videos find their way back online.

Child Pornography Videos Resurface Decades Later

The creation and distribution of child pornography is a serious crime that includes severe penalties for those convicted. One reason those penalties must be so steep is because once something is posted on the Internet, it is almost impossible to remove completely. Some survivors of childhood sexual assaults are finding that years, sometimes decades later, those photos and videos have re-emerged as prosecutors across the country have seized mobile phones, computers, and cloud storage of pedophiles.

A recent investigation by the New York Times into the effects of online storage and social media on the survivors of child sexual assault. The newspaper tells the story of two sisters, who choose to remain anonymous because they fear child molesters and other sexual predators seeking them out:

“Ten years ago, their father did the unthinkable: He posted explicit photos and videos on the internet of them, just 7 and 11 at the time. Many captured violent assaults in their Midwestern home, including him and another man drugging and raping the 7-year-old.

“The men are now in prison, but in a cruel consequence of the digital era, their crimes are finding new audiences. The two sisters are among the first generation of child sexual abuse victims whose anguish has been preserved on the internet, seemingly forever.”

In their interview, the sisters explain that online predators sometimes stalk people in the photos and videos they download. Even though the sisters are now 17 and 21 years old, they continue to relive their trauma whenever a man looks at them or asks, “Have I seen a picture of you when you were a kid?” They fear that their trauma will be there forever since the video of their childhood sexual assault is online for all to see.

Tech Companies Refuse to Fight Back Against Pedephilia on Their Platforms

Perhaps the worst part of this story is the fact that the tech industry has the tools to remove child pornography and other illegal and illicit content from its servers, but it refuses to use it. In 2009, Microsoft and Professor Hany Farid, now at the University of California, Berkeley invented a software known as PhotoDNA. It allows computers to compare photos against databases of known illegal images and flag illicit content for removal. You can see how PhotoDNA works in the New York Times article on their investigation.

But even though tech companies use this software for facial recognition, malware detection, and copyright enforcement, many refuse to apply the same software to stop the storage and distribution of child pornography:

  • Amazon does not even look for the imagery on its cloud storage
  • Apple does not scan its cloud storage and encrypts its messaging app, making detection nearly impossible
  • Dropbox, Google, and Microsoft scan for illegal images when they are shared, but not when they are uploaded
  • Snapchat and Yahoo look for photos but not videos
  • Facebook does scan its platforms, but does not use all available databases to detect material

“‘Each company is coming up with their own balance of privacy versus safety, and they don’t want to do so in public,’ said Alex Stamos, who served as chief of information security at both Facebook and Yahoo. ‘These decisions actually have a humongous impact on children’s safety.’”

New York Laws Allows Courts to Order Removal of Pornographic Images

But there is some good news for those survivors of childhood sexual assault living in New York State. New laws passed in 2019 give them the tools to take on the tech industry and get their images removed, even years after the fact. Taken together, the state’s revenge porn law and the Child Victims Act create an opportunity to enforce their privacy even against tech companies who value their consumers’ privacy over the victims of sexual assault.

The state’s law against the “dissemination or publication of an intimate image” went into effect on February 25, 2019. The law includes a private right to go to court and ask a judge for a court order requiring any website within its jurisdiction to permanently remove images or video from its sites and servers.

The New York State Child Victims Act, passed into law on January 24, 2019, gives those survivors more time to file their claims and get the relief they need. Civil lawsuits related to child sexual assault can be filed anytime until the victim turns 55 years old. There is even a one-year grace period for those whose cases are too old to fall within the statute. Taken together, these laws give survivors of child sexual assault the ability to fight back against the pedophiles that stalk them and the tech companies who shield those bad actors from justice.

At Eisenberg & Baum, our sexual abuse attorneys to stand beside child victims and their families against their abusers and the social media companies. We know how to use all the tools the law provides to get those images removed and protect their identity. We can help you file a claim and receive the compensation you deserve and the injunctive action you need to stop reliving your trauma online. Contact us today to schedule a free consultation.

U.S. Supreme Court Takes On Racial Discrimination in the Media

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There have been laws against racial discrimination since just after the Civil War. But when it comes to enforcing those laws, the battle rages on. That fight has made its way to the United States Supreme Court in Comcast Corp. v. National Association of African American-Owned Media. The way the Court rules could change the future of discrimination cases nationwide.

The Nation’s Oldest Civil Rights Law

Title VII of the Civil Rights Act became law in 1965, but it wasn’t the first time the legislature passed a law to protect the nation’s disadvantaged residents. 42 U.S.C. § 1981 — referred to by the courts as Section 1981 — was passed in the fallout of the Civil War in 1877. It says:

“All persons . . . shall have the same right in every State and Territory to make and enforce contracts . . . as is enjoyed by white citizens . . . .”

It was designed to protect African American residents and business owners from racial discrimination as they began to exercise their rights as citizens. When their commercial efforts are burdened by racial bias and bigotry, they can use the federal courts to get equal access under the law.

Racial Discrimination in Cable Broadcast Contracts

Section 1981 is the law Byron Allen fell back on when he was shut out of commercial contracts in his entertainment businesses. Allen owned and operated the Entertainment Studios, a television and motion picture company operating 7 channels including JusticeCentral.TV, Pets.TV, Comedy.TV and Cars.TV. His shows have been distributed through Verizon, AT&T, and DirecTV, but never with Comcast. Allen filed a federal Section 1981 lawsuit claiming that Comcast’s refusal to enter a contract with Entertainment Studios was due to racial discrimination. In support of that claim, his complaint alleged Comcast’s:

  • Expressions of interest followed by repeated refusals to contract
  • Suggestions of how to secure support followed by reversals of positions after Entertainment Studios had undertaken the time and expense of those steps
  • Exclusion of Entertainment Studios even when taking on all 500 networks by its main competitors
  • Carriage of “lesser-known, white-owned” networks while claiming it had no bandwidth to carry Entertainment Studios.

Comcast didn’t just respond to the complaint, it filed an immediate Motion to Dismiss the lawsuit. It said that it had legitimate business reasons for refusing the contracts with Entertainment Studios. It also said under federal court rules there was no way Allen could make a case for racial discrimination because nothing he claimed showed a “but for” connection between racial bias and the loss of the contract.

The Two Standards for Proving Racial Discrimination

Comcast’s motion, and its appeal, depended on two previous Supreme Court cases analyzing different civil rights laws: the Age Discrimination in Employment Act (ADEA) and retaliation claims brought under Title VII. These cases said that by default, these laws require that the offending behavior would not have occurred “but for” racial bias or bigotry.

The Ninth Circuit Court, which heard the case, said Section 1981 worked differently. It said that both the other laws contained language that the conduct was “because of” discrimination. There is no “because” in Section 1981. The appellate court said that meant instead of alleging “but for causation”, all Allen had to do was allege facts that show race was a motivating factor in Entertainment Studios’ disparate treatment. The appeals court said it wasn’t the plaintiff’s job to tell what was inside the mind of Comcast’s vice president of programming. As long as the facts alleged appeared to support that race was part of the equation, that was enough for the case to go through to the discovery phase.

The Supreme Court Hears the Arguments on Racial Bias in Negotiations

Comcast wasn’t satisfied with that answer. It appealed the decision to the U.S. Supreme Court, which granted certiorari to review the case. On November 13, 2019, the matter was heard by the U.S. Supreme Court. The oral argument came down to technical legal details and that same central theme: whether racial bias needed to be the direct cause of the lost business, or just one factor among many.

Unlike the Ninth Circuit Court, the Supreme Court Justices’ questions centered on the difference between pleadings and proof. The Ninth Circuit’s opinion seemed to suggest the motivating factor standard would apply all the way through the case. But by the end of the oral arguments, it seemed that everyone — even Mr. Allen’s attorney — agreed that when the time came for trial he would have to show that same “but for” connection between discrimination and action. But Comcast said that same standard should apply to the initial pleadings. Mr. Allen’s attorney said that level of proof should come later, after the attorneys had their chance to develop their case through discovery.

As with any Supreme Court decision, it is hard to know what the Justices will do even by reading the oral arguments. The Court has until June 2020 to deliberate and write its opinion. If the court determines that a plaintiff can file a complaint based on a motivating factor, it will make it easier for the victims of racial discrimination to make their cases and take them to court. If it rules in favor of a “but for causation” standard, plaintiffs will often have a hard time putting together the evidence they need without access to the defendant’s records, or their thoughts.

At Eisenberg & Baum, we know how important it is to develop a strong case for our clients. Our employment discrimination attorneys, help employees and business owners file their claims under Title VII, state civil rights laws, and Section 1981. We stay on top of changes in the law, so that you know we are using the best strategies against the discrimination you face at work and in your contracts. If you have been the victim racial discrimination, contact us. We’ll meet with you and help create a strategy that protects you and your business.

Will You Lose Your Rights If You Quit Your Job to Escape Sexual Harassment?

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Every day, many victims of sexual harassment walk into work wondering if this is the day they will quit. They may struggle to endure the hostile working environment rather than run the risks of unemployment. Others stick it out, only to be fired rather than have their complaints heard. Are you trapped in a sexually abusive workplace? What happens to your right to sue when you quit your job to escape sexual harassment?

This blog post will discuss EEOC v. Green Lantern Inn, Inc., Civil Action No. 6:19-cv-06704 in U.S. District Court for the Western District of New York, Rochester Division. It will discuss “constructive termination” and what happens if you quit your job to escape sexual harassment. It will also cover whether leaving a hostile work environment means giving up your right to protection under state and federal civil rights laws.

Hostile Work Environments Build Over Time

Sexual harassment and gender discrimination are rarely a one-time events. Most women and men facing sexual misconduct at work are subjected to a pattern of abuse that spans weeks, months, or even years. This behavior creates a “hostile work environment”. When an employer is put on notice that this kind of behavior is going on and doesn’t do anything to correct the problem, it can give the employee the right to sue her or his employer for sexual harassment at work.

How much harassment must you tolerate before you have a claim? The law says that a hostile work environment is created when a supervisor, coworker, or even customer of the business acts in a way that is “severe or pervasive enough to create a work environment that a reasonable person would consider intimidating, hostile, or abusive.” In most cases, that means more than just an off-color joke or a little flirting. But when you face sexual comments, jokes, or physical conduct day after day, it can quickly add up to more than a reasonable person can tolerate.

EEOC Sues for Hostile Work Environment at Rochester, New York Restaurant

That’s what happened to Rachel Clifford and her fellow coworker at Mr. Dominic’s on Main, a restaurant in Rochester, New York. The Equal Employment Opportunity Commission (EEOC) recently sued Green Lantern Inn, Inc. (the legal entity behind Mr. Dominic’s) for violating Title VII of the federal Civil Rights Act. The complaint in EEOC v. Green Lantern Inn, Inc., Civil Action No. 6:19-cv-06704 said that Rachel Clifford and her unnamed coworker suffered a pattern of sexual harassment by the restaurant’s head chef and kitchen manager, Paul Dowlatt. According to the complaint, his sexual misconduct included inappropriate physical contact, inappropriate, hostile and offensive comments, and explicit reqeusts for sex.

It was all too much for Ms. Clifford. She filed complaints about Dowlatt’s abusive conduct to the restaurant’s owner, John Tachin, and general manager, Anthony Barbone, but the company failed to act to protect her and her coworkers from the ongoing hostile behavior. When Mr. Dominic’s took no action to stop Dowlatt’s harassment, Clifford quit. Her coworker was fired shortly after lodging her own complaint about Dowlatt.

Both employees then filed complaints with the EEOC. When attempts at negotiation failed, the agency sued the restaurant on their behalf. Jeffrey Burstein, regional attorney for the EEOC’s New York District Office said in a statement:

“Employers who are on notice of sexual harassment in the workplace have a clear duty to quickly put an end to the harassment. . . . The EEOC will continue to hold employers accountable for failing to protect their employees from unlawful harassment.”

Quitting and “Constructive Termination”

The good news is that Ms. Clifford and others who are forced out of hostile work environments don’t automatically give up their rights to file claims with the EEOC or federal court just because they leave. According to the U.S. Supreme Court:

“Under the constructive discharge doctrine, an employee’s reasonable decision to resign because of unendurable working conditions is [equated with] a formal discharge for remedial purposes. . . .  The inquiry is objective: Did working conditions become so intolerable that a reasonable person in the employee’s position would have felt compelled to resign?” Pennsylvania State Police v. Suders, 542 U.S. 129, 141 (2004).

That means you aren’t forced to keep enduring toxic working conditions just to protect your rights. If any reasonable person would have resigned when you did, then the judge will treat your case just the same as if you were fired. You can see that in the complaint filed with the EEOC. Ms. Clifford quit, so her claim is for constructive termination, but it is treated the same as her coworker who was fired.

When an ongoing hostile work environment forces you out of a job, you need the help of employment discrimination attorneys who will work hard to protect your rights. At Eisenberg & Baum, LLP, our sexual harassment attorneys can help you demonstrate the conditions at your workplace, and prove your case to your employer, the EEOC, or the court. If you are facing sexual harassment at work, we can help. Contact Eisenberg & Baum, LLP, today to talk to a sexual harassment attorney.