STATE OF WISCONSIN
LABOR AND INDUSTRY REVIEW COMMISSION
P O BOX 8126, MADISON, WI 53708-8126 (608/266-9850)

DEBRA M SCHWINN, Complainant

DODGE COUNTY COOPERATIVE, Respondent

FAIR EMPLOYMENT DECISION
ERD Case No. 199601849, EEOC Case No. 26G961234

An administrative law judge (ALJ) for the Equal Rights Division of the Department of Workforce Development issued a decision in this matter. A timely petition for review was filed.

The commission has considered the petition and the positions of the parties, and it has reviewed the evidence submitted to the ALJ. Based on the applicable law, records and evidence in this case, and after consulting with the presiding ALJ concerning the credibility and demeanor of the witnesses, the commission makes the following:

FINDINGS OF FACT

1. Debra Schwinn is an adult woman residing in Mayville, Wisconsin.

2. The Dodge County Cooperative is a diversified business headquartered in Beaver Dam, Wisconsin. At all times relevant to this complaint the president of the business was David Cramer. One of the operations of the business was the petroleum division. The petroleum division included five convenience stores, two in Beaver Dam, and one each in Juneau, Iron Ridge and Hartford, Wisconsin. The Cooperative staffed these stores with employes who were classified as either store supervisors or cashiers. At all times relevant to this complaint the supervisor of the petroleum division was Larry Stensrud.

3. Hiring and firing of store supervisors, and their rate of pay, were determined by Mr. Stensrud and Mr. Cramer. Payroll and benefits were administered from the headquarters in Beaver Dam.

4. With the exception of one of the stores in Beaver Dam, known as the automotive center, (1) the Cooperative's convenience stores offered similar products and had similar operations. Store supervisors performed essentially the same functions from one convenience store to another. These duties included scheduling employes, ordering inventory, pricing products (other than gasoline), completing sales reports, balancing cash drawers, making deposits, and making sure the store was clean and the shelves were stocked.

5. In approximately February 1995, Ms. Schwinn applied to be the store supervisor at the Iron Ridge store. Mr. Stensrud reviewed her application (Exh. 9) and interviewed her for this position.

6. Ms. Schwinn's application showed that she had approximately eight months of experience at a grocery store courtesy counter, performing some of the tasks that would be required as a store supervisor for the Cooperative, including operating a cash register, opening and closing cash drawers, and making deposits. Her application also showed she had worked for two years for a local newspaper maintaining billing and payroll records. Ms. Schwinn's application also showed that she was a high school graduate who had completed two business classes at a local technical college.

7. Mr. Stensrud and Mr. Cramer believed that Ms. Schwinn's experience, training and ability as shown by her application were sufficient to perform the duties of store supervisor, and they offered her the position at $6.00 per hour. She responded that she was already making $6.50 per hour in her current job and would like to match that wage rate. They declined to offer her $6.50 per hour, but Mr. Stensrud told her that he would see how she was doing in 60 days. Ms. Schwinn took this to mean that she might get a raise to $6.50 in 60 days, but Mr. Stensrud did not intend to convey that meaning--it was his intention that Ms. Schwinn's wage rate be reviewed after six months on the job. Ms. Schwinn accepted employment at $6.00 per hour.

8. At the time Ms. Schwinn started her employment for the Cooperative, a male employe, Donald Whitenight, had been the supervisor of the Cooperative's Hartford store for approximately five months.

9. When Mr. Stensrud and Mr. Cramer had hired Mr. Whitenight, they were aware from his application and resume (Exh. 12) that he had approximately six months of experience as a purchasing assistant with the University of Wisconsin--Milwaukee (UWM). In that job he had ordered food and food-related supplies and equipment for 20 or so snack shops and cafeterias on the campus, whose combined sales equaled $6,000,000, which was a task similar to the duty of ordering inventory as a store supervisor for the Cooperative. As part of his job at UWM, he audited vendor files to eliminate vendor overcharging. He also had owned a take-out restaurant for about one year, ordering food and supplies. Mr. Whitenight also served as a non-commissioned officer in the U.S. Air Force, and underwent six- and eight-week leadership courses. He also earned 15 credits in criminal law and management at St. Leo College in Virginia.

10. Mr. Stensrud and Mr. Cramer deemed Mr. Whitenight's experience, training and ability sufficient to perform the duties of store supervisor for the Cooperative. They offered him the position at $6.50 per hour and he accepted.

11. Changes occurred in Ms. Schwinn's and Mr. Whitenight's rates of pay as follows:

12. Shortly after Ms. Schwinn began working she found that she regularly had to put in 10 to 15 hours of overtime per week, because the Cooperative was having a hard time attracting employes to work as cashiers at the Iron Ridge store. The Cooperative generally paid store supervisors time-and-a-half for hours in excess of 40 per week. Mr. Stensrud informed Ms. Schwinn several times that she should not be putting in so much overtime. Mr. Stensrud and Mr. Cramer wanted Ms. Schwinn to work about 42 to 43 hours per week.

13. Mr. Stensrud and Mr. Cramer reviewed pay rates of the store supervisors annually in April. They did not do so for Ms. Schwinn in April 1995, however, because they did not believe she had been in her position long enough to receive a raise. Ms. Schwinn complained to Mr. Stensrud that she was expecting a 60-day review in April 1995, to which Mr. Stensrud replied that she would not get a review until she had been employed for six months. Mr. Whitenight had not received a raise during the first six months of his employment.

14. Although the Cooperative did not have a formal seniority system, the practice was that a store supervisor's time in the position was related to his or her rate of pay, since pay increases were generally given at regular intervals.

15. In May or June 1995, at Ms. Schwinn's request, Mr. Stensrud and Ms. Schwinn met to discuss the problem of staffing the Iron Ridge store. Mr. Stensrud offered Ms. Schwinn a raise of $.50 per hour, (2) but Ms. Schwinn, hoping to solve the problem of her excessive overtime, offered to take only $.25 of the raise if the Cooperative would offer the other half of the raise to Mary Ann Otte, a cashier at the Hartford store, to entice her to transfer to the Iron Ridge store as a full-time cashier. The Cooperative and Ms. Otte went along with this idea, and Ms. Schwinn received a $.25 raise effective June 25, 1995.

16. In the April 1996 review of store supervisors, Mr. Stensrud and Mr. Cramer decided to offer Ms. Schwinn a raise of $.30 per hour. They decided to offer Mr. Whitenight a raise of $.15 per hour.

17. Mr. Stensrud met with Ms. Schwinn and informed her that she would be getting a $.30 per hour raise effective April 1, 1996. During this meeting, Stensrud and Schwinn were seated at a desk across from each other, and Mr. Stensrud had the raises for each of the store supervisors written down in a closed notebook he had in front of him at the desk. For a brief period during the meeting Mr. Stensrud was called away from the office, and during this time Ms. Schwinn opened the notebook for a few seconds and saw that Mr. Whitenight was going to be paid in excess of $7.00 per hour. (3) When Mr. Stensrud returned to the office Ms. Schwinn told him that she wanted to be paid $7.00 per hour. Mr. Stensrud told her that they could not afford to pay her $7.00 per hour.

18. Later that day Mr. Stensrud reported to Mr. Cramer that Ms. Schwinn was not happy with the $.30 raise. They talked it over and decided to offer her an additional $.20, bringing her wage to $6.75 per hour. Mr. Stensrud telephoned her to offer this additional amount. He told her the Cooperative could not afford to pay her more than that. He did not propose increasing her hours or switching her to salaried status.

19. Within the next day or two, Mr. Stensrud visited Ms. Schwinn at the Iron Ridge store and asked her if she would be willing to fill in for two weeks at the Juneau store, which was lacking a store supervisor. Ms. Schwinn agreed to do so.

20. The next Monday morning, April 22, 1996, Ms. Schwinn gave Mr. Stensrud a notice complaining about her pay raise and stating that she would resign in two weeks (Exh. 10). She asked him to give it to Mr. Cramer. He did so, and Mr. Cramer accepted it. Before deciding to accept her resignation, Mr. Stensrud and Mr. Cramer understood that the reason she was resigning was that they had refused to raise her wages to $7.00 per hour.

21. Within a day or two, Harland Bender, a male part-time cashier at the Iron Ridge store, making $5.25 per hour, learned that Ms. Schwinn had given her resignation, and he told Mr. Stensrud that he was interested in the position. The Cooperative had been interested in hiring Mr. Bender as manager of the Iron Ridge store even before it hired Ms. Schwinn, but his then-employer (a McDonald's restaurant) offered Mr. Bender more for his services.

22. When he discussed the April 1996 vacancy at the Iron Ridge store, Mr. Bender told Mr. Stensrud that he was currently making $20,000 per year as an assistant manager at a McDonald's restaurant. Mr. Stensrud replied that the Cooperative could not meet that, and he asked Mr. Bender what he would accept. Mr. Bender replied that he would accept $18,500 per year.

23. Mr. Stensrud took this information back to Mr. Cramer. They reviewed his resume (Exh. 13), which indicated that he had approximately four years of experience supervising crews at fast food restaurants. Mr. Bender's experience involved scheduling and managing employes, being responsible for cash, and ordering products. Mr. Bender had, of course, also been working as a part-time cashier for the Cooperative.

24. Mr. Stensrud and Mr. Cramer believed that Mr. Bender had the skills necessary to perform the job of store supervisor, and on or about April 23, 1996 they offered him the position at $18,500 per year provided that he agreed to work a minimum of 50 hours per week (with no additional pay for hours in excess of 40 per week.) Mr. Bender agreed to those terms.

25. The idea of making Mr. Bender a salaried employe as opposed to an hourly one, and the idea of requiring a minimum 50-hour work-week, were Mr. Cramer's. The Cooperative had no formal policy as to when workers would be paid on an hourly basis, as opposed to on an annual salary basis.

26. Mr. Bender in fact worked at least 50-hour weeks as the Iron Ridge store manager. Mr. Bender's $18,500 annual salary for a 50-hour week works out to $6.47 per hour. (4) That is, a store manager who was paid $6.47 on an hourly basis, received time-and-a-half for overtime, and worked 50-hour weeks, would earn $18,500 per year.

27. Ms. Schwinn, Mr. Bender, and Mr. Whitenight performed equal or substantially similar work for the Cooperative.

28. Sex was not a factor in the difference in rate of compensation paid to Ms. Schwinn as compared to Mr. Bender or Mr. Whitenight nor was sex a factor in the difference in terms or conditions of employment between Ms. Schwinn and Mr. Bender.

29. Until Ms. Schwinn delivered her notice stating that she was resigning immediately (Exh. 11), at no time did she inform Mr. Stensrud or Mr. Bender that she believed she was being treated adversely on the job because of her sex. Therefore the Cooperative's treatment of Ms. Schwinn was not in retaliation to any opposition by Ms. Schwinn of a practice she had claimed to be discriminatory.

30. The Cooperative's refusal to pay Ms. Schwinn $7.00 per hour did not create such intolerable conditions for Ms. Schwinn that she had no recourse but to resign her position.

Based on the Findings of Fact made above, the Commission makes the following:

CONCLUSIONS OF LAW

1. The complainant is a member of a protected class under Wis. Stat. ch. 111, subch. II, the Wisconsin Fair Employment Act (the Act).

2. The respondent is an employer within the meaning of the Act.

3. The respondent did not violate the Act by discriminating against the complainant on the basis of her sex by failing to pay her a starting wage rate of $6.50 per hour, the starting wage rate given to Mr. Whitenight, for equal or substantially similar work as Mr. Whitenight.

4. The respondent did not violate the Act by discriminating against the complainant on the basis of her sex by failing to pay her a starting wage rate of $18,500 per year for a 50-hour week, the starting wage rate given to Mr. Bender, for equal or substantially similar work as Mr. Bender.

5. The respondent did not violate the Act by discriminating against the complainant on the basis of her sex by failing to accommodate her request in April 1996 to be paid at the rate of $7.00 per hour and instead accommodating Mr. Bender's request to be paid $18,500 per year for substantially similar work.

6. The complainant was not constructively discharged in April 1996 when the respondent denied her request to be paid $7.00 per hour.

7. The respondent did not retaliate against complainant for opposing a perceived discriminatory practice.

Based on the Findings of Fact and Conclusions of Law, the commission issues the following:

ORDER

The complaint is dismissed.

Dated and mailed: October 13, 1998
schwind.rrr : 101 : 9

/s/ David B. Falstad, Chairman

/s/ Pamela I. Anderson, Commissioner

/s/ James A. Rutkowski, Commissioner

MEMORANDUM OPINION

Under the Act, (5) it is illegal to discriminate against any individual in promotion, in compensation paid for equal or substantially similar work, or in terms, conditions or privileges of employment on the basis of sex, unless sex is a bona fide occupational qualification. Ms. Schwinn alleges that the Cooperative violated the Act by discriminating against her on the basis of sex, both in compensation and in terms or conditions of employment.

In evaluating complaints of sex discrimination in compensation under the Act, the commission has looked to the analysis followed under the federal Equal Pay Act. Sahr v. Tastee Bakery, ERD case no. 8800838 (LIRC, 1/22/91); and Anderson v. LIRC, case no. 87-CV-5338 (Wis. Cir. Ct. Dane County, 2/12/88), affirming Anderson v. City of Sheboygan Health Department, ERD case nos. 8104377 (LIRC, 8/20/97). Under the Equal Pay Act analysis, a complainant must show that the employer pays employes of different sexes differently for equal work on jobs the performance of which requires equal skill, effort and responsibility and which are performed under similar working conditions. If that showing is made, an employer is liable unless it proves that the pay differential is the result of: (a) a seniority system, (b) a merit system, (c) a system which measures earnings by quantity or quality of production, or (d) any factor other than sex. Sahr, supra; Anderson, supra, and Foss v. P.A. Bergner and Company, ERD case nos. 8950461 and 8951128 (LIRC, 03/04/91). The Equal Pay Act analysis has been described as a strict liability test in which it is not necessary to prove intent to discriminate: an employer who pays different wages is automatically liable unless it proves one of the defenses. Strecker v. Grand Forks County Social Services Board, 640 F.2d 96, 99, 24 FEP Cases 1019, 1020 footnote 1 (8th Cir. 1980).

However, in part because the provisions of the state fair employment statutes and the federal Equal Pay Act are not identical, it is also appropriate to apply the conventional analysis on the issue of discrimination. The conventional analysis is particularly appropriate where the wage differential is sequential rather than simultaneous. Sahr, supra. Under the conventional analysis, the complainant must make a prima facie case by showing she was a qualified worker treated less favorably with respect to pay than workers of the other gender. The burden then shifts to the employer to articulate a legitimate nondiscriminatory reason for the pay difference. If such a reason is articulated, the complainant must prove by a preponderance of the evidence that the proffered nondiscriminatory reason was not the real reason for the discrimination in pay but merely a pretext for discrimination. Currie v. DILHR, 210 Wis. 2d 380, 389-90 (Ct. App. 1997). The conventional and Equal Pay Act analyses differ not only in terms of allocation of proof, but also on the issue of employer intent which is the central focus of the conventional analysis. Sahr, supra. On the other hand, the federal courts have held that Title VII of the Civil Rights Act and the Equal Pay Act should be construed in harmony, and have stated that the basic analysis is the same under either theory. Strecker, supra, at 24 FEP Cases 1020.

In this case, Ms. Schwinn has made a prima facie case under both analyses with respect to her claims regarding disparate starting pay. Ms. Schwinn's starting pay ($6.00) was less on an hourly basis than the starting pay that Mr. Whitenight received five months before she started ($6.50) or that Mr. Bender received 14 months after she started ($6.47). Moreover, Ms. Schwinn and Mr. Bender held exactly the same position, Iron Ridge convenience store supervisor. That position was substantially similar to Mr. Whitenight's position as Hartland convenience store manager. The jobs required equal skill, effort and responsibility, and were performed under similar working conditions. (6)

The Cooperative thus has the burden, under the Equal Pay Act analysis, of showing some reason other than sex for the starting pay differential. Under the conventional analysis, the Cooperative must articulate a legitimate non-discriminatory reason for the starting pay differences. The Cooperative has done both, by establishing that the differences in starting pay were the result of different levels of pre-employment experience.

Ms. Schwinn, Mr. Whitenight and Mr. Bender all had prior relevant experience. However, the Cooperative could reasonably place a higher value on Mr. Whitenight's experience ordering supplies and dealing with vendors as a purchasing assistant at UWM, than on Ms. Schwinn's experience handling cash and making deposits as a grocery store convenience clerk. In addition, the Cooperative could also reasonably place a value on Mr. Whitenight's military service as a noncommissioned officer in the Air Force, experience which required leadership abilities and was viewed by the Cooperative as demonstrating the persistence desirable in a convenience store manager.

By the same token, the Cooperative could reasonably place more value on Mr. Bender's four years' experience as a manager and assistant manager at a McDonald's restaurant, than on Ms. Schwinn's experience. Mr. Bender had experience in managing a store, supervising employes, cash handling, dealing with customers, being responsible for cash, and ordering product. Although Ms. Schwinn had experience in some of these areas as well, the Cooperative could reasonably view Mr. Bender's experience as superior.

The facts surrounding all three supervisors' hiring also indicate that the starting pay decisions were based largely on legitimate negotiation independent of gender concerns. None of the three supervisors started at the same pay rate. Mr. Whitenight received $6.50 per hour and was paid for overtime. Mr. Bender, who had previously rejected a convenience store supervisor position, was successful in obtaining an annual salary of $18,500. However, in exchange, the Cooperative insisted on a minimum 50-hour week without overtime compensation, which resulted in an equivalent hourly wage of $6.47 per hour. For her part, Ms. Schwinn was unsuccessful in her attempt to negotiate starting pay of $6.50, but received an understanding that she would receive favorable consideration in a subsequent raise. Indeed, during her employment, the difference between Ms. Schwinn's pay and Mr. Whitenight's pay lessened, notwithstanding his greater seniority and her refusal of $.25 of an offered $.50 raise in June 1995.

During the credibility conference, (7)   the commission and the presiding ALJ discussed the fact that Ms. Schwinn had lessened the difference between her pay and Mr. Whitenight's. The ALJ explained that he believed that Ms. Schwinn received a higher wage increase in April 1996 in part because she was a "squeaky wheel" who demanded a higher wage. In the commission's view, this supports the inference that the starting pay rates, too, were determined in part by legitimate negotiation tactics based on factors other than sex. Further, the fact that Ms. Schwinn was able to decrease the difference in pay during her tenure tends to support the Cooperative's assertion that it did not base its pay decisions on gender.

During the credibility conference, the ALJ also explained that he did not believe that some of the skills acquired by Mr. Whitenight in prior employment, such as dealing with dishonest vendors, were particularly relevant to the convenience store supervisor position because the job did not require the skills. However, the commission believes that the Cooperative could legitimately consider those skills in determining Mr. Whitenight's starting pay. The focus of the inquiry is not on how Ms. Schwinn or the commission perceives Ms. Schwinn's prior experience in comparison to that of Mr. Whitenight or Mr. Bender, but on how the Cooperative perceived it. Weihaupt v. AMA, 874 F.2d 419, 428, 49 FEP Cases 1162, 1169 (7th Cir. 1989). By the same token, courts generally decline to dictate what factors an employer may use to judge between employes or job applicants, so long as the factors are considered in good faith and are not discriminatory. Legro v. County of Langlade, ERD case no. 8801033 (LIRC, 3/20/90), and Weihaupt, supra, at 49 FEP Cases at 1169-70.

The commission recognizes that, in some cases, an employer's explanation of how it judged prior employment experience might simply be incredible. Such an incredible explanation would not establish "a factor other than sex" under the Equal Pay Act analysis, and could establish a pretext under the conventional analysis. Because the differences in pre-employment experience are real and relevant, the commission is satisfied that this is not such a case.

However, the ALJ also questioned the difference in how the Cooperative dealt with Ms. Schwinn's pay raise demand in April 1996 and how it dealt with Mr. Bender's nearly contemporaneous starting wage demand. Essentially, after the Cooperative offered her a $.30 per hour raise which brought her wage to $6.55 per hour, Ms. Schwinn demanded a raise to $7.00 per hour. The Cooperative then increased her raise by $.20 cents, bringing Ms. Schwinn's wage to $6.75. By contrast, when Mr. Bender demanded $18,500 per year, the Cooperative ultimately granted that demand, with the condition that he work 50 hours per week.

A valid distinction may be drawn between how an employer deals with a starting wage demand by a job applicant and how it deals with a pay raise demand by an incumbent employe. Further, the commission is not persuaded the Cooperative actually dealt with Mr. Bender more favorably than Ms. Schwinn. While Mr. Bender's annual salary for a 50-hour week was higher than Ms. Schwinn's annualized salary for a 43-hour week, his hourly rate was less than what Ms. Schwinn demanded and less than what she ultimately was offered.

In short, the Cooperative dealt with Ms. Schwinn's $.45 per hour raise demand by offering $.20 more per hour. It dealt with Mr. Bender's $18,500 annual starting wage demand by agreeing to the dollar amount, but demanding a 50-hour workweek. The commission cannot conclude these facts establish disparate treatment in and of themselves. Neither do these facts discredit the testimony of Mr. Stensrud or Mr. Cramer about how they set starting pay for the convenience store supervisors, nor do these facts show that the Cooperative's proffered explanation for the disparities in starting pay (differences in pre-employment experience) was a pretext for sex discrimination.

cc: James H. Olson
Russ R. Mueller

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Footnotes:

(1)( Back ) The automotive center is much larger than the convenience stores, stays open longer hours, and offers more products and services than the convenience stores.

(2)( Back ) The timing of this offer, four months after Ms. Schwinn's starting date, was a departure from normal practice, triggered by Ms. Schwinn's request for a meeting. The employer considered this offer to be in lieu of the normal six-month pay increase.

(3)( Back ) This is the first point in time that Ms. Schwinn had reason to believe that pay rates might differ based on sex.

(4)( Back ) [40x + 10(1.5x)] = $18,500; 2860x = $18,500; x = $6.468.

(5)( Back ) Specifically, Wis. Stats. §§ 111.321 though 111.325 and 111.36(1)(a).

(6)( Back ) Of course, given the evidence offered by the Cooperative to rebut Ms. Schwinn's prima facie case, the question of whether she actually made a prima facie case is technically no longer relevant. U.S. Postal Service Board of Governors v. Aikens, 460 U.S. 711, 715 (1983), and Kurtz v. School Dist. of St. Croix Falls, ERD case no. 8901470 (LIRC, 6/20/93).

(7)( Back ) Transamerica Ins. Co. v. ILHR Department, 54 Wis. 2d 272, 283-84 (1972).