On remand from the Supreme Court, the Ninth Circuit reaffirms its original en banc holding that a "factor other than sex" under the Equal Pay Act (29 U.S.C. §206(d)(1)) must be "job-related," and thus rejects an employer's use of pre-employment salary history as a reason to pay a woman less than a man doing the same work. The court once again overrules its prior decision on this subject, Kouba v. Allstate Ins. Co., 691 F.3d 873 (9th Cir. 1982).
A few weeks ago, the California state legislature passed a bill that unequivocally prohibits employers from using an employee's prior salary, even in combination with legitimate factors, to justify a gender- and race-based pay differential for performing the same or similar work. The new legislation, which California Governor Jerry Brown signed into law on July 18th, reflects a welcome trend both at the federal and state levels to combat a common pay practice that has perpetuated the gender pay gap for decades: basing new employee compensation on the applicant's salary history.