Family Dollar will pay $45 million to female managers

family dollars agreed to pay $45 million to a class of female store managers who sued the company claiming that they had been paid less than the male store managers. Earlier this week, a federal court approved the class action regulation. The pay discrimination claims were filed under Title VII of the Civil Rights Act of 1964 as well as the Equal Pay Act.

Plaintiffs are represented by Wiggins, Childs, Pantazis, Fisher & Goldfarb.

Defendant is represented by Robinson Bradshaw & Hinson PA and Gibson Dunn & Crutcher LLP.

Background to the case

In 2002, nearly 50 Family Dollar store managers filed a discrimination complaint with the Equal Employment Opportunity Commission (EEOC). These charges alleged that the company paid them less than male store managers in the same situation.

The plaintiffs then took their suit to Federal Court where it was “vigorously litigated” over the next ten years. Among the disputed issues was whether the class action could proceed in light of the Supreme Court’s landmark ruling on class action issues in the Walmart vs. Dukes case in 2011.

Eventually, the parties reached a settlement agreement in 2017 and the court held an equity hearing, after which it decided to approve the settlement on March 14, 2018.

Relief Granted by Settlement Agreement

Under the terms of the settlement, the category of female Family Dollar store managers will receive a total of $45 million. The money will be distributed to class members through the court-appointed settlement administrator. Class attorneys will receive 1/3 of that amount ($15 million) plus approximately $1 million in legal costs.

In addition, Family Dollar is required, among other things, to review its compensation practices related to store managers and to consult with labor economists for this purpose.

The Interplay of Title VII and the EPA in Pay Discrimination Complaints

Two of the key federal laws that help ensure that female employees receive the same pay as their male counterparts are Title VII of the Civil Rights Act of 1964 and the Equal Pay Act (EPA). Although both laws cover issues of wage discrimination, there are important differences that you should be aware of as these differences can have a significant impact on your case. These discrepancies come into play in traditional complaints of gender-based wage discrimination, as well as in case of discrimination by glass ceiling.

While Title VII and the EPA have many similarities, they also have some notable distinctions that may affect your potential lawsuit (all points below assume the claim is against a private employer):

  • Under the EPA, you are not required to file an EEOC discrimination charge before going to court, but you must file a charge for a Title VII wage discrimination claim;
  • The time limit for filing a complaint in court under the EPA is two years from the discriminatory wage practice (or three years if the violation is willful), while a Title VII pay discrimination charge must be filed with the EEOC within 180 or 300 days. (depending on the state you live in) discriminatory pay practices;
    • NOTE I: The Lilly Ledbetter Equitable Compensation Act extends the statute of limitations for discriminatory compensation claims by specifying “that a discriminatory compensation decision . . . occurs whenever compensation is paid under the [discriminatory decision].” Pub. L. No. 111-2, 123 Stat. 5 (2009)
    • NOTE II: You are also permitted to file an EEOC discrimination charge for a claim with the EPA, but filing a charge with the EEOC does not extend the two-year time limit for filing a complaint with the EPA. EPA.
  • Unlike the EPA, no requirement exists under Title VII to prove that your employment is substantially equal to that of a higher paid male employee, nor under Title VII you must work in the same establishment as the male comparator;
  • In an EPA claim, your employer will bear the burden of evidence (not just a burden of production such as in a Title VII claim) to establish its EPA defense (seniority system, merit system, production quota system, or any factor other than gender);
  • If you prove that your employer willfully violated the EPA, you may be entitled to damages;
  • The anti-discrimination provisions of Title VII cover more protected characteristics (race, sex, religion, etc.) than the EPA, which is limited to differences based on sex.

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© 2022 Zuckerman LawNational Law Review, Volume VIII, Number 80

Pamela W. Robbins