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Eighth Circuit Says Employer Not Entitled To Business-Judgment Jury Instruction In Equal Pay Act Case

On June 6th, in Bauer v. Curators of University of Missouri, — F.3d —, 2012 WL 2014278 (8th Cir. June 6, 2012), the Eighth Circuit Court of Appeals held employers are not entitled to a business-judgment jury instruction for claims brought pursuant to the Equal Pay Act (“EPA”). Plaintiff Susan Bauer, an advanced practical nurse at the University of Missouri Hospital and Clinics, sued the Board of Curators, alleging a violation of the EPA. She claimed she was paid less than a male who performed substantially equal work under similar work conditions. The case proceeded to trial.

At trial, the Board of Curators requested a business-judgment jury instruction. Employers typically request business-judgment instructions to guide jurors to focus on the law and not whether they would have made a similar personnel decision. Despite Bauer’s objection, the trial court submitted a business-judgment instruction stating: “You may not return a verdict for the plaintiff just because you might disagree with the defendant’s decision or believe it to be harsh or unreasonable.” While it may never be known whether the business-judgment instruction motivated the jury, the jury returned a verdict in favor of the Board of Curators. Bauer appealed, arguing that the business-judgment instruction should not have been submitted on her EPA claim.

The Eighth Circuit agreed. As the appellate court explained, gender discrimination claims may be brought under both Title VII and the EPA, but the laws differ in several respects. Significantly, the EPA does not require employees to prove that an employer acted with discriminatory intent. Instead, under the EPA, employees need only establish pay differentials between men and women in similar positions. The employer ultimately carries the burden of persuasion under the EPA and must prove that any pay differential was based on a factor other than gender. In sharp contrast, an employer defending a claim brought under Title VII need only articulate a legitimate, non-discriminatory reason for its actions while the plaintiff bears the burden of presenting evidence that the reason given by the employer is pretextual. This key difference, as the court concluded, renders the business-judgment instruction “irrelevant” for claims brought under the EPA.

Consequently, the Eighth Circuit held the district court erred by giving the business-judgment instruction for Bauer’s EPA claim. Nonetheless, the Eighth Circuit ruled that the error was harmless under the circumstances of Bauer’s case. As the court concluded, “Taken as a whole, the instructions correctly state the law, requiring a verdict for the plaintiff under some circumstances or for the defendant under others.”

While the employer ultimately prevailed in Bauer, the decision is an important reminder that employers bear the burden under the EPA – unlike many other statutes – of establishing that pay differentials between men and women in similar positions are based on factors other than gender.