Dana L. Branam,
Complainant,

v. 

Tom Kilgore,
President and Chief Executive Officer,
Tennessee Valley Authority,
Agency.

Appeal No. 0120112831

Hearing No. 420-2010-00113X

Agency No. 2010013

DECISION

Complainant filed an appeal from the Agency's April 15, 2011, final order concerning an equal employment opportunity (EEO) complaint claiming employment discrimination in violation of Title VII of the Civil Rights Act of 1964 (Title VII), as amended, 42 U.S.C. § 2000e et seq. and the Equal Pay Act of 1963, as amended, 29 U.S.C. § 206(d) et seq.  The Commission deems the appeal timely and accepts it pursuant to 29 C.F.R. § 1614.405(a

BACKGROUND

During the period at issue, Complainant worked as a Unit Supervisor, Senior Reactor Operator at the Agency's Browns Ferry Nuclear Plant in Decatur, Alabama.

Complainant filed an EEO complaint alleging that the Agency discriminated against her on the basis of sex (female).  By letter dated December 16, 2009, the Agency accepted Complainant's formal complaint for investigation and determined that it was comprised of the following claim:

Complainant is being paid a lower salary than male Senior Reactor Operator Unit Supervisors.  

At the conclusion of the investigation, the Agency provided Complainant with a copy of the report of investigation and notice of her right to request a hearing before an EEOC Administrative Judge (AJ).  Complainant timely requested a hearing.  Over Complainant's objections, the AJ assigned to the case granted the Agency's Motion for Summary Judgment and issued a decision without a hearing on March 3, 2011.


In his decision, the AJ found that Complainant did not establish a prima facie case under the EPA.  Specifically, the AJ noted that the Agency entered into a Long Term Deferred Compensation Plan Agreement (Agreement) with the Agency on January 26, 2007.  The AJ noted that "[t]he Agreement required Complainant to remain a TVA employee for three years.  In return for remaining a TVA employee for three years, Complainant would receive annual deferred compensation credits of $20,000 in January of each year beginning upon her signing the agreement in 2007.  At the end of the three year period, on December 31, 2009, Complainant would receive $60,000, plus any interest." 

The AJ noted that a payment was issued to Complainant, in the amount of $65,093.98, minus taxes under the Agreement on December 31, 2009.  The AJ found that this payment represented long-term deferred compensation plus interest paid to Complainant for the preceding three year period and was additional compensation for the three year period of calendar years 2007, 2008 and 2009.  The AJ noted that "dividing the total deferred remuneration Complainant received by each of the three years in which it was earned result in an additional yearly compensation of $21, 697.99 for each of the calendar years...Adding this amount to Complainant's base compensation for each of the three year periods indicates that Complainant was actually paid more than any of her similarly situated male co-workers for 2007-2009."  The AJ further noted that the term "wages" generally includes all payments made to or on behalf of an employee as remuneration for employment.

Regarding Complainant's Title VII claim, the AJ found that Complainant did not establish a prima facie case of sex discrimination because there is no evidence that Complainant was treated less favorably than similarly situated male supervisors.  The AJ further found that even assuming arguendo that Complainant established a prima facie case of sex discrimination, the Agency articulated legitimate, nondiscriminatory reasons for its actions.

In its final order dated April 15, 2011, the Agency implemented the AJ's decision without a hearing,  finding no discrimination.  The Agency  found that Complainant did not establish a prima facie case of discrimination under the EPA because she failed to show that she received less compensation than her male counterparts.  The Agency stated "[w]hen Complainant's deferred compensation is added to her base salary, which ranged from $96,361 to $102,000.00 between October 2007 and September 2009, Complainant earned over $21,000 more each year than her male or female counterparts."

Under a Title VII analysis, the Agency found that even assuming Complainant established a prima facie case, the Agency articulated legitimate, nondiscriminatory reasons for Complainant's salary (that it was based on her job performance not sex) and Complainant did not establish that the articulated reasons were pretext for discrimination.




ANALYSIS AND FINDINGS

We must first determine whether it was appropriate for the AJ to have issued a decision without a hearing on this record.  The Commission's regulations allow an AJ to issue a decision without a hearing when he or she finds that there is no genuine issue of material fact.  29 C.F.R. § 1614.109(g).  This regulation is patterned after the summary judgment procedure set forth in Rule 56 of the Federal Rules of Civil Procedure.  The U.S. Supreme Court has held that summary judgment is appropriate where a court determines that, given the substantive legal and evidentiary standards that apply to the case, there exists no genuine issue of material fact.  Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986).  In ruling on a motion for summary judgment, a court's function is not to weigh the evidence but rather to determine whether there are genuine issues for trial.  Id. at 249.  The evidence of the non-moving party must be believed at the summary judgment stage and all justifiable inferences must be drawn in the non-moving party's favor.  Id. at 255.  An issue of fact is "genuine" if the evidence is such that a reasonable fact finder could find in favor of the non-moving party.  Celotex v. Catrett, 477 U.S. 317, 322-23 (1986); Oliver v. Digital Equip. Corp., 846 F.2d 103, 105 (1st Cir. 1988).  A fact is "material" if it has the potential to affect the outcome of the case.  

The AJ erred by issuing a decision without a hearing in the instant matter because the record is not adequately developed.   The hearing process is intended to be an extension of the investigative process, designed to ensure that the parties have "a fair and reasonable opportunity to explain and supplement the record and, in appropriate instances, to examine and cross-examine witnesses."  See Equal Employment Opportunity Directive for 29 C.F.R. Part 1614 (EEO MD-110), 7-1 (Nov. 9, 1999); see also 29 C.F.R. § 1614.109(e).  "Truncation of this process, while material facts are still in dispute and the credibility of witnesses is still ripe for challenge, improperly deprives Complainant of a full and fair investigation of her claims."  Bang v. U.S. Postal Serv., EEOC Appeal No. 01961575 (Mar. 26, 1998).  

The U.S. Supreme Court articulated the requirements for establishing a prima facie case of  discrimination under the EPA in Corning Glass Works v. Brennan, 417 U.S. 188, 195 (1974).  To establish a violation of the EPA, a complainant must show that he or she received less pay than an individual of the opposite sex for equal work, requiring equal skill, effort and responsibility, under similar working conditions within the same establishment.  Id. At 195; see also 29 C.F.R. § 1620.14(a).

Once a complainant has met the burden of establishing a prima facie case, an employer may avoid liability only if it can be proven that the pay difference is justified under one of the four affirmative defenses set forth in the EPA, namely: 1) a seniority system; (2) a merit system, (3) a system which measures earnings by quantity or quality of production of work (also referred to as an incentive or piecework system) or 4) a differential based on any factor other than sex, 29 U.S.C. 206(d)(1); Corning Glass Works, 417 U.S. at 196-97.  The requirement of "equal work" does not mean that the jobs must be identical, but only that they must be "substantially equal."

The AJ erred by finding that Complainant did not establish a prima facie case of discrimination under the EPA.  The record reflects that Complainant's base salary between 2007-2009 was lower than most of her male counterparts.  We note that the Agency below asserted that three of her male counterparts received less base compensation than Complainant during September 2006-September 2007.  However, the Commission has found that to prove a violation of the EPA, Complainant need not compare herself to all similarly situated employees or even all similarly classified male employees, but may choose one or more among those doing the same work to compare herself.  See Jacobsen v. Dep't of the Navy, EEOC Appeal No. 0120052957 (Dec. 21, 2006) (citing Ellison v. United States, 25 Cl. Ct. 481 (Mar. 13, 1992).  

While the AJ found that Complainant's compensation from the deferred agreement should be added to her base compensation in order to determine if she was paid less than her male counterparts, we disagree.  

The AJ properly  noted  that "wages include all payments made to [or on behalf of] an employee as remuneration for employment. The term includes all forms of compensation irrespective of the time of payment, whether paid periodically or deferred until all forms of compensation irrespective of time of payment, whether paid periodically or deferred until a later date..."1 29 C.F.R. § 1620.10.  However, the Commission has set forth that under the EPA,  equal wages must be paid in the same form.  EEOC Compliance Manual Section 10, "Compensation Discrimination," No. 915.003, at 10-IV(C) (Dec. 5, 2000).  Specifically, the Commission in its Compliance Manual sets forth that "[an] employer cannot pay a higher hourly wage to one  [employee] and then attempt to equalize the difference by periodically paying a bonus to the employee of the opposite sex."  Id.

In addition, the focus in terms of establishing a pay disparity under the EPA should be with respect to "wage rate" rather than total remuneration. See Ebbert v. Nassau Cnty., 2009 WL 935812 at * 2 (E.D.N.Y. 2009).  In Ebbert, the Court noted that the EPA "speak[s] in terms of rate of pay, not total remuneration."  Id.  The Court further noted that "while it is true that 'wages' include, inter alia, premium payments for work on Saturdays, Sundays, holidays, regular days of rest or other days or hours in excess or outside of the employee's regular days or hours of work...it is only the rate at which such payments are made that matters.  The term wage rate includes the rate at which overtime compensation or other special remuneration is paid as well as the rate at which straight time compensation for ordinary work is paid. Id. (citations omitted); see, also Bence v. Detroit Health Corp, 712 F.2d 1024, 1027 (6th Cir. 1983) (compensation disparity found where employer paid higher commission rates to males than females, even though total remuneration was substantially equal.) 

In the instant matter, the AJ and the Agency improperly found Complainant's Agreement relating to her continued employment with the Agency for a specified time to be part of her base compensation.  We find, however, that the Agreement was not part of her base compensation but rather compensation based on a retention agreement and thus not in the "same form" as her base compensation.  Further, as set forth above, even if Complainant's total remuneration was higher for the specified time period due to the Agreement, the record reflects that her "wage rate" for her base compensation was lower than most of her male comparators.  Based on the foregoing, we find the AJ and the Agency improperly added compensation from the Agreement to Complainant's base compensation.  When solely looking at Complainant's base compensation (or "wage rate" for her base salary) for the period in question,  we determine that Complainant has established that her base compensation (or "wage rate") was lower than numerous other male comparators.

In addition, this matter warrants further development as to whether the disparity in Complainant's base compensation is due to a factor other than sex.  The Agency below asserts that Complainant's base compensation is linked to her performance.  The Agency sets forth the following events with respect to Complainant's base compensation. Complainant's base compensation was $96,361 between September 2006- September 2007.  Complainant received an overall "Meets Some"2 rating for her performance for the period between September 18, 2006-September 16, 2007.  The Agency in its final order stated that this rating "indicated that the employee did not successfully complete all assigned responsibilities."  Thus, the Agency asserts that Complainant did not receive an increase in September 2007 (like her comparators) and became the lowest paid Unit Supervisor with respect to her comparators.

 The Agency, however, sets forth in its Motion for Summary Judgment that on January 25, 2008, Complainant received a 3.78% increase (bringing her base compensation to $100,000) and that only three of Complainant's comparators received a higher percentage increase at this point in time.  The Agency asserts that Complainant again received a "Meets Some" overall rating for the performance period September 2007-September 2008. The Agency asserts that Complainant and her comparators who received a "Meets Some" rating were all provided with 2% increase in September 2008 (bringing Complainant's base compensation to $102,000).

While the Agency sets forth that Complainant's base compensation was based on her performance, it is unclear from the record why Complainant received a 3.78% increase in January 2008 (which the Agency asserts was among one of the highest increases amongst her comparators), after receiving an overall rating of "Meets Some" in September 2007, just a few months earlier.  In addition, while Complainant received a "Meets Some" rating in September 2007 for her performance during September 2006-September 2007 period, the record contains a memorandum dated December 20, 2006 from the Chief Nuclear Officer and the Vice President of Human Resources requesting approval for Long Term Deferred Compensation Agreements for Complainant and three other employees.  The memorandum provides in pertinent part "[e]ach of the employees listed above have demonstrated knowledge and/or skills that are critical to the [Agency's] nuclear operations.  All of the employees are exceptional performers with a high potential to be recruited by other companies and/or to consider retirement in the near future." (emphasis added). Thus, we note that in September 2007, Complainant was provided with a "Meets Some" rating for her performance for September 2006-September 2007 and denied an increase; however, Agency management in their memorandum dated December 2006, referred to her as an "exceptional performer."  

Based on the foregoing, we find that the AJ erred in issuing a decision without hearing because the issue of whether Complainant's disparity in her base compensation is due to a factor other than sex needs to be further developed before a decision is issued on the merits.  Because Complainant's Title VII claim involves the same matters, we also remand it with Complainant's EPA claim for a hearing.3

Based on a thorough review of the record, we REVERSE the Agency's final order implementing the AJ's decision without a hearing finding no discrimination and we REMAND this matter for a hearing in accordance with the ORDER below.

ORDER

The Agency shall submit a copy of the complaint file to the Hearings Unit of the Birmingham District Office within fifteen (15) calendar days of the date this decision becomes final.  The Agency shall provide written notification to the Compliance Officer at the address set forth below that the complaint file has been transmitted to the Hearings Units.  Thereafter, an AJ shall process the matter in accordance with 29 C.F.R. § 1614.109, and the Agency shall issue a final action in accordance with 29 C.F.R. § 1614.110.

IMPLEMENTATION OF THE COMMISSION'S DECISION (K0610)

Compliance with the Commission's corrective action is mandatory.  The Agency shall submit its compliance report within thirty (30) calendar days of the completion of all ordered corrective action. The report shall be submitted to the Compliance Officer, Office of Federal Operations, Equal Employment Opportunity Commission, P.O. Box 77960, Washington, DC 20013.  The Agency's report must contain supporting documentation, and the Agency must send a copy of all submissions to the Complainant.  If the Agency does not comply with the Commission's order, the Complainant may petition the Commission for enforcement of the order.  29 C.F.R. § 1614.503(a).  The Complainant also has the right to file a civil action to enforce compliance with the Commission's order prior to or following an administrative petition for enforcement.  See 29 C.F.R. §§ 1614.407, 1614.408, and 29 C.F.R. § 1614.503(g).  Alternatively, the Complainant has the right to file a civil action on the underlying complaint in accordance with the paragraph below entitled "Right to File a Civil Action."  29 C.F.R. §§ 1614.407 and 1614.408.  A civil action for enforcement or a civil action on the underlying complaint is subject to the deadline stated in 42 U.S.C. 2000e-16(c) (1994 & Supp. IV 1999).  If the Complainant files a civil action, the administrative processing of the complaint, including any petition for enforcement, will be terminated.  See 29 C.F.R. § 1614.409.

STATEMENT OF RIGHTS - ON APPEAL

RECONSIDERATION (M0610)

The Commission may, in its discretion, reconsider the decision in this case if the Complainant or the Agency submits a written request containing arguments or evidence which tend to establish that:

1.	The appellate decision involved a clearly erroneous interpretation of material fact or law; or

2.	The appellate decision will have a substantial impact on the policies, practices, or operations of the Agency.

Requests to reconsider, with supporting statement or brief, must be filed with the Office of Federal Operations (OFO) within thirty (30) calendar days of receipt of this decision or within twenty (20) calendar days of receipt of another party's timely request for reconsideration. See 29 C.F.R. § 1614.405; Equal Employment Opportunity Management Directive for 29 C.F.R. Part 1614 (EEO MD-110), at 9-18 (November 9, 1999).  All requests and arguments must be submitted to the Director, Office of Federal Operations, Equal Employment Opportunity Commission, P.O. Box 77960, Washington, DC 20013.  In the absence of a legible postmark, the request to reconsider shall be deemed timely filed if it is received by mail within five days of the expiration of the applicable filing period.  See 29 C.F.R. § 1614.604.  The request or opposition must also include proof of service on the other party.  

Failure to file within the time period will result in dismissal of your request for reconsideration as untimely, unless extenuating circumstances prevented the timely filing of the request.  Any supporting documentation must be submitted with your request for reconsideration.  The Commission will consider requests for reconsideration filed after the deadline only in very limited circumstances.  See 29 C.F.R. § 1614.604(c).

COMPLAINANT'S RIGHT TO FILE A CIVIL ACTION (R0610)

This is a decision requiring the Agency to continue its administrative processing of your complaint.  However, if you wish to file a civil action, you have the right to file such action in an appropriate United States District Court within ninety (90) calendar days from the date that you receive this decision.  In the alternative, you may file a civil action after one hundred and eighty (180) calendar days of the date you filed your complaint with the Agency, or filed your appeal with the Commission.  If you file a civil action, you must name as the defendant in the complaint the person who is the official Agency head or department head, identifying that person by his or her full name and official title.  Failure to do so may result in the dismissal of your case in court.  "Agency" or "department" means the national organization, and not the local office, facility or department in which you work.  Filing a civil action will terminate the administrative processing of your complaint.

RIGHT TO REQUEST COUNSEL (Z0610)

If you decide to file a civil action, and if you do not have or cannot afford the services of an attorney, you may request from the Court that the Court appoint an attorney to represent you and that the Court also permit you to file the action without payment of fees, costs, or other security.  See Title VII of the Civil Rights Act of 1964, as amended, 42 U.S.C. § 2000e et seq.; the Rehabilitation Act of 1973, as amended, 29 U.S.C. §§ 791, 794(c).  The grant or denial of the request is within the sole discretion of the Court.  Filing a request for an attorney with the Court does not extend your time in which to file a civil action.  Both the request and the civil action must be filed within the time limits as stated in the paragraph above ("Right to File a Civil Action").

FOR THE COMMISSION:


______________________________
Carlton M. Hadden, Director
Office of Federal Operations


November 8, 2012
Date



1 The Commission noted in its Compliance Manual that this provision of the EPA reflected that if male and female employees performing substantially equal work receive equal salaries but unequal fringe benefits, an EPA violation can be established.  EEOC Compliance Manual Section 10, "Compensation Discrimination," No. 915.003, at 10-IV(C) (Dec. 5, 2000).
2 The Agency, in its final order, notes that that the performance system included the following possible performance ratings: "Exceeds Expectations,"  "Meets Expectations," "Meets Some Expectations," and "Unacceptable."
3 We note that any violation of the Equal Pay Act is also a sex based violation of Title VII under EEO Regulation 29 C.F.R. § 1620.27(a).
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U.S. EQUAL EMPLOYMENT OPPORTUNITY COMMISSION
Office of Federal Operations
P.O. Box 77960
Washington, DC 20013



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