$182,500 to be Paid By Tire Company for Pay Discrimination, Training Ordered

 
Wednesday, August 6, 2014
 
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Royal Tire, Inc., a commercial and retail tire company based in St. Cloud, Minn., will pay $182,500 and be subject to detailed consent decree which resolves a lawsuit filed by the U.S. Equal Employment Opportunity Commission (EEOC). The decree was approved on July 31, 2014 by Judge John R. Tunheim of U.S. District Court for the District of Minnesota.

The EEOC's lawsuit charged that between January 2008 and June 2011, Royal Tire discriminated against its female human resources director, Christine Fellman-Wolf, by paying her lower wages than it paid a male employee who held the very same position. The EEOC's investigation showed that when Fellman-Wolf became HR director she was paid $35,000 less per year than her male predecessor, and $19,000 less than the minimum salary for the position under Royal Tire's own compensation system. Fellman-Wolf complained about the disparity and asked to be compensated fairly, but Royal Tire did not make up the difference.

Pay discrimination is illegal under the Equal Pay Act of 1963 (EPA), which prohibits sex-based wage differentials for work requiring equal skill, effort, and responsibility performed under the same or similar working conditions. It is also illegal under Title VII of the Civil Rights Act of 1964, which generally prohibits employment discrimination-including in compensation-on the basis of sex. Both statutes are enforced by the EEOC, and EEOC's lawsuit charged that Royal Tire had violated both. The EEOC filed suit on June 21, 2013 in U.S. District Court for the District of Minnesota (Equal Employment Opportunity Commission and Fellman-Wolf v. Royal Tire, Inc., Civil Action No. 13-cv-1516 (JRT/LIB)) after first attempting to reach an pre-litigation settlement through its voluntary conciliation process.

In addition to substantial monetary relief to Fellman-Wolf, Royal Tire must comply with the three-year consent decree, which contains an injunction prohibiting the company from any future discriminating based on sex, paying men and women different wages for doing equal work, and retaliating against employees who exercise their rights under federal law. Additionally, the consent decree requires Royal Tire to evaluate its pay structure to ensure compliance with the Equal Pay Act and Title VII, and if it discovers employees who are being paid less than required by law, it must immediately raise the wages for those employees. The decree requires training for Royal Tire's managers and employees under the Equal Pay Act and Title VII, and allows the EEOC to monitor Royal Tire's compliance with the decree. Royal Tire must report to the EEOC any complaints it receives about pay discrimination and provide information on how it handles those complaints.

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