Ninth Circuit Hears Pay Case Challenging University Pay Decisions

3 minute read | June.02.2020

On Tuesday, May 12, 2020, the Ninth Circuit heard oral argument in Freyd v. University of Oregon.  Jennifer Freyd, a professor of Psychology at the University of Oregon, filed a class action lawsuit in March 2017 alleging gender-based pay differences in violation of the Equal Pay Act, Title VII, and other statutes.  Freyd asserted that the University paid her less than four male colleagues in her department and that the University’s retention award policy had a disproportionate impact on the University’s female psychology professors.  In May 2019, the District Court granted Defendants’ motions for summary judgment, and Freyd subsequently appealed the decision to the Ninth Circuit Court of Appeals.

In Freyd v. Univ. of Oregon, 384 F. Supp. 3d 1284 (D. Or. 2019), motion for relief from judgment denied, No. 6:17-CV-00448-MC, 2019 WL 5682512 (D. Or. Oct. 25, 2019), the District Court described the unique qualities of the academic environment, how scholars within that environment often choose different duties, tasks and responsibilities based on interests and how pay decisions factor are based on complex factors.  The Court explained that, “the notion of academic freedom spawns an environment where those working in the same discipline may choose to follow different paths of knowledge and pursue endeavors that create unique value to the institution.”  Second, universities must “offer competitive salaries in order to attract top faculty, while at the same time being fair to senior professors whose salaries are often tied to a pay scale or a plan that has not kept up with the market.”

Evaluating the Equal Pay Act and the Title VII claims, the Court found that Freyd failed to identify suitable comparators.  Her four male colleagues performed “significantly different work,” and “the work and the value of that work varies greatly from professor to professor.”  The Court recognized that full professors in the Psychology Department have the same broad job duties of research, teaching, and service.  However, the Court determined that Freyd’s skills, duties and responsibilities did not meet the job similarity requirement under the laws because her comparator professors’ actual duties differed in significant ways. Unlike Freyd, the other professors received larger grant awards or had other responsibilities including serving as department chair or directors of significant university initiatives.  Moreover, turning to the university’s legitimate reasons, the Court determined that the pay differentials were appropriately based on those different job duties.

The Court also rejected Freyd’s disparate impact claim that the university’s retention awards resulted in disfavoring women psychology professors.  First, the Court criticized Freyd’s statistical case because the sample size was too small and did not establish a pattern of discrimination.  Second, the Court credited the university’s showing that the retention bonuses served a necessary business purpose to retain highly credentialed professors.

This decision is in line with the Fourth Circuit’s decision we reported on last year which also raised the bar for professors seeking to bring compensation claims.  In Spencer v. Virginia State University, the Fourth Circuit affirmed the district court’s decision granting summary judgement to the university finding that the plaintiff there failed to establish that the two male professors who had greater responsibilities were appropriate comparators.  Echoing the Freyd decision’s focus on the unique environments at universities, the Fourth Circuit stated that “[p]rofessors are not interchangeable like widgets” and the University’s salary decisions accounted for the differences in skill and responsibility attendant to different jobs.  In fact, the Fourth Circuit observed several “concrete differences” in the work performed by plaintiff and the two male professors, such as working in different departments, teaching different class levels, and working a different numbers of hours on a weekly basis.

If the Ninth Circuit similarly decides to affirm the district court’s decision in Freyd, academic professionals will face a high bar in bringing pay discrimination cases in the future.  This case could also have broad applications to many professional environments where employees are highly specialized and have the freedom to decide how to accomplish broad job duties.