Marybeth Lauderdale v. Illinois Department of Human S , 876 F.3d 904 ( 2017 )

In the
United States Court of Appeals
For the Seventh Circuit
____________________
No. 16-3830
MARYBETH LAUDERDALE,
Plaintiff-Appellant,
v.
ILLINOIS DEPARTMENT OF HUMAN SERVICES, et al.,
Defendants-Appellees.
____________________
Appeal from the United States District Court for the
Northern District of Illinois, Central Division.
No. 13-CV-3062 — Richard Mills, Judge.
____________________
ARGUED SEPTEMBER 20, 2017 — DECIDED NOVEMBER 30, 2017
____________________
Before MANION and KANNE, Circuit Judges, and MILLER,
District Judge.∗
KANNE, Circuit Judge. Marybeth Lauderdale alleges she
was paid substantially less than her male colleague despite
taking on twice the responsibility. The Equal Pay Act, Title
VII of the Civil Rights Act of 1964, and the Equal Protection
∗ The Honorable Robert L. Miller, Jr., of the United States District Court
for the Northern District of Indiana, sitting by designation.
2 No. 16-3830
Clause of the Fourteenth Amendment prohibit state employ-
ers from paying an employee less based on her sex. However,
the record indicates that the pay discrepancy in this case was
not based on sex. Therefore, the district court’s grant of sum-
mary judgment for the defendants-appellees is affirmed.
I. BACKGROUND
Marybeth Lauderdale served as acting superintendent for
the Illinois School for the Deaf (“ISD”) from 2006 to 2007 and
as superintendent from 2007 to 2010. During her last year as
superintendent, she was paid a base salary of $83,856 plus a
5% bilingual pay bonus, for a total of $88,048. Reggie Clinton
was superintendent for the School for the Visually Impaired
(“ISVI”) from 1998 to 2003 and again from 2008 to 2010. When
Clinton returned to ISVI in 2008, he received a 1.9% salary in-
crease from his most recent salary at the Arcola School Dis-
trict. He was paid, at the end of his tenure at ISVI, $121,116
per year.
In 2010, Clinton resigned. The Illinois Department of Hu-
man Services, which oversees ISD and ISVI, decided to create
one combined superintendent role to cover both schools. The
Department offered Lauderdale the role. Lauderdale wanted
to be paid as much or more than Clinton had been paid; the
Department counteroffered. Communications indicate that
some Department employees believed Lauderdale was enti-
tled to a large pay raise because she was taking on two roles.
However, the same communications reveal budget con-
straints and a concern that the Department of Central Man-
agement Services would not authorize a 30% pay increase for
a public employee. Eventually, Lauderdale accepted a salary
No. 16-3830 3
of $106,500, which was less than what Clinton was paid as su-
perintendent of ISVI, but a 21% increase from Lauderdale’s
salary as superintendent of ISD.
Lauderdale filed a lawsuit alleging sex discrimination
based on the difference between what she was paid and what
Clinton had been paid. Specifically, she alleged a violation of
the Equal Pay Act by the Department, and she alleged claims
of sex discrimination by the Department and several individ-
uals under Title VII and § 1983. Upon a review of the evi-
dence, the district court concluded no reasonable juror could
find the pay discrepancy was a product of sex discrimination.
The court found that the discrepancy instead resulted from
budget concerns and from the application of the Illinois Pay
Plan. Furthermore, Lauderdale did not provide sufficient ev-
idence for a jury to find these explanations were pretextual.
Thus, the district court granted summary judgment in favor
of the defendants on all counts.
II. ANALYSIS
We review the district court’s grant of summary judgment
de novo and in doing so construe all facts in the light most fa-
vorable to Marybeth Lauderdale, the non-moving party.
Hooper v. Proctor Health Care Inc., 804 F.3d 846, 849 (7th Cir.
2015). Summary judgment is appropriate when there is no
genuine issue of material fact and the moving party is entitled
to judgment as a matter of law. Fed. R. Civ. P. 56(a). “[T]he
ultimate question … is ‘whether a reasonable jury could find
prohibited discrimination.’” Hooper, 804 F.3d at 853 (quoting
Bass v. Joliet Pub. Sch. Dist. No. 86, 746 F.3d 835, 840 (7th Cir.
2014)).
4 No. 16-3830
Because a plaintiff’s burden of proof is different for Equal
Pay Act claims than it is for Title VII and § 1983 claims, we
review Lauderdale’s Equal Pay Act claim first, then address
her claims brought under Title VII and § 1983.
A. Equal Pay Act
Lauderdale claims that the Department violated the Equal
Pay Act when it paid her less than it paid Reggie Clinton. The
Equal Pay Act prohibits an employer from discriminating be-
tween employees on the basis of sex. 29 U.S.C. § 206(d)(1). To
establish a prima facie cause of action under the Act, an em-
ployee must demonstrate “a difference in pay for ‘equal work
on jobs the performance of which requires equal skill, effort,
and responsibility, and which are performed under similar
working conditions.’” King v. Acosta Sales & Mktg., Inc., 678
F.3d 470, 474 (7th Cir. 2012) (quoting 29 U.S.C. § 206(d)(1)). If
this requirement is satisfied, the burden of proof shifts to the
employer to prove some neutral factor that explains the dis-
crepancy in salary. Corning Glass Works v. Brennan, 417 U.S.
188, 196 (1974). The Act provides four affirmative defenses by
which the employer can claim the discrepancy is not discrim-
inatory: “where … payment is made pursuant to (i) a seniority
system; (ii) a merit system; (iii) a system which measures
earnings by quantity or quality of production; or (iv) a differ-
ential based on any other factor other than sex.” 29 U.S.C.
§ 206(d)(1).
Lauderdale compares her role as dual superintendent
with that of Clinton as superintendent of ISVI. Lauderdale
took over all of Clinton’s responsibilities in addition to those
she had as a superintendent of ISD, so it is clear that she suf-
ficiently alleged that she was paid less for work that was equal
No. 16-3830 5
to, if not more demanding than, the work performed by Clin-
ton. “[D]ifferences in skill, effort, or responsibility” do not jus-
tify a finding that two jobs are not equal “where the greater
skill, effort, or responsibility is required of the lower paid
sex.” 29 C.F.R. § 1620.14(a).
The Department concedes that Lauderdale has sufficiently
established a prima facie case under the Act, but argues the
pay discrepancy was based on non-discriminatory bases: Illi-
nois’s CMS Pay Plan, Lauderdale’s and Clinton’s prior sala-
ries, and budget concerns.
1. Illinois’s CMS Pay Plan
The Illinois Administrative Code sets forth a detailed pay
plan for state employees. Ill. Admin. Code 80, § 310. Positions
are assigned established salary ranges, and raises and bo-
nuses are based on the established applicable range. Pay in-
creases are based primarily on the employee’s prior salary.
Upon promotion, an employee’s increase in pay is generally
limited to 5% of the employee’s current base salary. Id.
§ 310.460. The increase can be greater if necessary to meet the
minimum rate of the salary range for a new position, but the
increase cannot exceed the maximum rate of the salary range.
Id. Any other increase greater than 5% is considered a “special
salary adjustment,” which must be approved by the Director
of Central Management Services. Id.
Lauderdale claims there is no evidence in the record that
the Department believed the pay plan applied when someone
is hired for a newly created position. An employer’s given ex-
planation for a pay discrepancy must be supported by evi-
dence that the employer actually relied on that reason. King,
678 F.3d at 474. Contrary to Lauderdale’s assertion, the record
6 No. 16-3830
contains compelling evidence that the Department believed
the pay plan was applicable. The documents submitted by the
Department include forms establishing the new position, clas-
sifying the new position within the pay plan, and setting the
salary range for the new position. (R. 58-13, at 1–4; R. 61-5, at
8–11.) Additionally, the record includes an email sent to De-
partment officials regarding the creation of the dual superin-
tendent position. (R. 61-7, at 6–7.) The email explains that De-
partment employees were working with “Classification and
CMS” and had submitted the job duties to CMS for classifica-
tion. (Id.)
Lauderdale further argues that the Department did not
adhere to the pay plan when determining her salary, because
her pay was increased more than 5% and the Department
failed to produce a decision memorandum, which is a re-
quired step in the process of seeking approval for a pay in-
crease greater than 5%. But the record includes a CMS-163
“Special Salary Request” form, which indicates that the De-
partment sought approval for the increase. (R. 58-11, at 1.)
2. Prior Salaries
Even if the Department did not strictly follow the pay
plan, it is clear that prior salary was a factor in determining
what increase was appropriate, and this court has repeatedly
held that a difference in pay based on the difference in what
employees were previously paid is a legitimate “factor other
than sex.” Wernsing v. Dep’t of Human Servs., 427 F.3d 466, 468
(7th Cir. 2005) (citing Dey v. Colt Constr. & Dev’t Co., 28 F.3d
1446 (7th Cir. 1994), Riordan v. Kempiners, 831 F.2d 690 (7th Cir.
1987), and Covington v. S. Ill. Univ., 816 F.2d 317 (7th Cir.
1987)).
No. 16-3830 7
In Riordan, the employee alleged an Equal Pay Act viola-
tion based in part on the fact that her male subordinates were
paid more than her. 831 F.2d 690. The subordinates’ pay was
higher because they had been paid more at their previous po-
sitions. Id. at 699. The court discussed how the use of senior-
ity-based systems make it common in civil service settings for
a subordinate to be paid more than his or her superior and
concluded that a pay discrepancy created by reliance on em-
ployees’ prior salaries is not a violation of the Equal Pay Act.
Id. at 696–97.
Lauderdale’s previous salary was significantly lower than
Clinton’s previous salary. Clinton had been paid $118,794 as
superintendent of the Arcola School District before he re-
turned to the Department as the superintendent of ISD.
Lauderdale was paid $88,048 at her previous position as su-
perintendent of ISD.
Basing pay on prior wages could be discriminatory if sex
discrimination led to the lower prior wages, but Lauderdale
has not asserted such a claim in this case. See Wernsing, 427
F.3d at 470–71.
3. Budget Concerns
The Department also explains that the pay decision was
based on budget concerns. Of course, budget concerns are a
part of every employment decision. The record in this case,
however, details concerns beyond the normal attempts to bal-
ance budgets. Employees of ISD and ISVI, including Lauder-
dale, had been required to take furlough days and were aware
that the schools might have to close entirely due to funding
cuts. In 2009, a rally was held at the state capitol to protest the
potential closing of the schools. Lauderdale and several of the
8 No. 16-3830
defendants spoke about the ongoing budget crisis and poten-
tial cuts in their depositions.
Lauderdale argues budget concerns could not genuinely
be the basis for her lower salary because the Department was
already eliminating one entire position by having her serve
both roles. Additionally, the maximum rate for the dual su-
perintendent salary range was set at $126,000. While it is true
that the Department could have paid Lauderdale more and
still saved money, it is not the role of this court to determine
how agencies should spend their money, so long as they are
not discriminating. Wernsing, 427 F.3d at 468 (“The statute
asks whether the employer has a reason other than sex—not
whether it has a ‘good’ reason.”).
The record indicates that the Department was genuinely
concerned about the budget when deciding to offer Lauder-
dale a salary lower than Clinton’s. In an email to staff in the
Governor’s office, Michelle Saddler, director of the Depart-
ment, asked for advice regarding Lauderdale’s request for a
27.5% salary increase. (R. 58-14, at 1.) She wrote that she was
“concerned that in the current climate, even 19% is pushing
the limits of public acceptability.” (Id.) The Chief of Staff to
the Governor responded that, in light of the request, the De-
partment should start interviewing other candidates. (Id.) In
the same email chain, another Department employee referred
to the potential of 6% budget cuts and the closure of ISVI,
though she acknowledged closure was unlikely. (Id. at 2.)
If presented with this evidence, no reasonable juror could
find that Lauderdale was paid less because of her sex. There-
fore, the district court’s grant of summary judgment in favor
of the defendants on Lauderdale’s Equal Pay Act claim will
be affirmed.
No. 16-3830 9
B. Title VII and Equal Protection
Lauderdale also asserts the alleged sex discrimination was
a violation of Title VII of the Civil Rights Act of 1964 and a
violation of her right to equal protection. Title VII makes it
unlawful for an employer to “discriminate against any indi-
vidual with respect to his compensation … because of such
individual’s … sex.” 42 U.S.C. § 2000e-2(a)(1). “The equal pro-
tection clause of the Fourteenth Amendment protects individ-
uals against intentional, arbitrary discrimination by govern-
ment officials.” Hayden ex rel. A.H. v. Greensburg Cmty. Sch.
Corp., 743 F.3d 569, 577 (7th Cir. 2014). An individual who is
subjected to unconstitutional discrimination can seek relief
from his or her employer under 42 U.S.C. § 1983. See e.g. id. at
575 n.3; Burks v. Wis. Dep’t of Transp., 464 F.3d 744 (7th Cir.
2006).
To prove a claim of employment discrimination under Ti-
tle VII and § 1983, a plaintiff must present sufficient evidence
that she was a member of a protected class, she performed
reasonably on the job in line with the employer’s legitimate
expectations, she was subjected to an adverse employment ac-
tion, and similarly situated employees of the opposite sex
were treated more favorably. Burks, 464 F.3d at 750. If that
burden is met, the employer must articulate a “legitimate,
nondiscriminatory reason” for paying the plaintiff less. Id. at
751. Unlike in an Equal Protection Act claim, however, the
plaintiff maintains the burden of proof. St. Mary’s Honor Cen-
ter v. Hicks, 509 U.S. 502, 507 (1993); see Fallon v. Illinois, 882
F.2d 1206, 1213 (7th Cir. 1989) (liability under the Equal Pay
Act does not prove a violation of Title VII). But see id. at 1213–
14 (discussing opinions from other courts holding that Equal
Pay Act liability automatically establishes Title VII liability).
10 No. 16-3830
If the employer articulates a nondiscriminatory reason for
the pay discrepancy, the plaintiff must prove that the em-
ployer’s justification was pretext for a decision made on pro-
hibited criteria (here, sex). St. Mary’s, 509 U.S. at 507–08; Burks,
464 F.3d at 751. If she cannot, her claim fails. St. Mary’s, 509
U.S. at 507–08; Burks, 464 F.3d at 751. An employee can prove
a reason was pretextual by showing that the reason was “1)
factually baseless; 2) not the employer’s actual motivation; 3)
insufficient to motivate the action; 4) or otherwise pretextual.”
E.E.O.C. v. Target Corp., 460 F.3d 946, 957 (7th Cir. 2006). On
summary judgment, the plaintiff must present evidence that
supports an inference that the employer was intentionally dis-
honest when it gave its nondiscriminatory reason. Id. at 960.
1. Lauderdale’s Initial Burden
The defendants do not challenge Lauderdale’s assertions
that she is a member of a protected class, that she performed
well, and that she was paid less than Reggie Clinton. Clinton
and Lauderdale did not have identical roles, but for these pur-
poses it is logical to consider them similarly situated. Factors
relevant to the determination of whether employees are simi-
larly situated include “whether the employees reported to the
same supervisor, whether they were subject to the same
standards and whether they had comparable education, ex-
perience and qualifications.” Burks, 464 F.3d at 751. Lauder-
dale and Clinton answered to the same supervisor, Robert
Kilbury. According to the job application for the dual super-
intendent role and Clinton’s affidavit, the qualifications and
education requirements for both positions were very similar.
The dual superintendent position required a four-year college
degree, master’s degree and/or specialist degree, four years of
No. 16-3830 11
administrative experience, knowledge of the relevant regula-
tions, and an administrative endorsement. Clinton had bach-
elor’s, master’s, and education specialist degrees; administra-
tive experience; and a superintendent endorsement. Simi-
larly, Lauderdale had bachelor’s, master’s, and education spe-
cialist degrees; experience as superintendent of ISD; and a su-
perintendent endorsement.
Finally, as superintendents, Clinton and Lauderdale car-
ried out many of the same duties. They were both expected to
develop and direct the operations and activities of the schools,
serve as policy-making officials, coordinate budgets, super-
vise employees, ensure compliance with state and federal reg-
ulations, review relevant legislation, and serve as representa-
tives of the schools. The only difference is that Lauderdale
held these responsibilities at two schools instead of one. Thus,
Lauderdale submitted sufficient evidence to meet her initial
burden.
2. The Department’s Justifications
The Department explains that budget concerns were the
primary cause of the pay discrepancy. The Department also
claims the pay plan and Clinton’s and Lauderdale’s prior sal-
aries caused the pay discrepancy. In response, Lauderdale re-
peats many of the same arguments already discussed regard-
ing whether these justifications were genuinely relied upon to
make the salary decision. For the reasons already explained,
Lauderdale’s arguments fail.
In her attempt to prove the budget concern explanation
was pretextual, Lauderdale points to her deposition state-
ment that no one ever told her that budget concerns pre-
12 No. 16-3830
vented the Department from paying her more. But Lauder-
dale’s own statements in her deposition reveal that she was
aware the Department was facing considerable budget con-
cerns. She also acknowledged that budget concerns were dis-
cussed, but states that she did not think that the concerns were
genuine. Email communications sent while the salary negoti-
ations were on-going show the individuals involved were
concerned about giving Lauderdale a very large pay increase
in light of budget concerns and in light of concerns for how
the public would react to such a large increase for a public
employee at a time when other services were being cut.
Lauderdale also relies on the job posting for the dual su-
perintendent position, which states that the maximum salary
for the position was $126,000—$20,000 more than she was
paid. The Department explains that the salary range listed on
the bulletin reflects the maximum salary for all jobs in that
classification, not what was actually budgeted for the dual su-
perintendent role for that year. The bulletin itself states that
the salary range listed is only a guide and that salary would
be based on the individual’s qualifications and the Depart-
ment’s salary plan. Therefore, Lauderdale has failed to pro-
vide enough evidence to convince a reasonable juror that the
Department was lying when it said the salary decision was
based on budget concerns.
3. Individual Liability
Lauderdale further claimed that Governor Pat Quinn and
various Department employees should be held personally li-
able for violating her rights under Title VII and the equal pro-
tection clause. She alleges that each person was individually
responsible, at least in part, for the salary decision, yet offers
no evidence that would support such a finding. These claims
No. 16-3830 13
largely rely on Lauderdale’s assertion that the Department it-
self engaged in unlawful discrimination. Lauderdale fails to
explain why the district court should have held the individu-
als liable even after it concluded that the Department itself did
not engage in unlawful discrimination. Therefore, the district
court was correct when it concluded that Lauderdale failed to
provide sufficient evidence that would allow a reasonable
jury to find that the governor and Department employees per-
sonally engaged in unlawful discrimination.
III. CONCLUSION
For the reasons above, we AFFIRM the district court’s
grant of summary judgment in favor of the defendants-appel-
lees.