EEOC Files Class Action Against Maryland Insurance Administration

As reported by The Daily Record, The Equal Employment Opportunity Commission filed a class-action suit last week against the Maryland Insurance Administration, claiming the agency is “willfully” paying its female insurance investigators and enforcement officers less than their male counterparts.

In a press release dated April 20, the EEOC says it attempted to reach a pre-litigation settlement with the agency before filing the suit. The case, filed April 15 in the U.S. District Court for the District of Maryland, Northern Division, is captioned EEOC v. Maryland Insurance Administration, Civil Action No. 1:15-cv-01091-JFM).

According to the press release, a spokesman for the Maryland Insurance Administration said the MIA strongly disputes the allegations and assured that “the case will be vigorously defended.”

Having served as Senior Counsel to the MIA, and as Assistant Attorney General at the agency, I will be following this case closely.

The EEOC’s lawsuit claims that since late 2009, the Maryland agency has been violating the Equal Pay Act of 1963, which prohibits paying men and women differently for equal work. The EEOC is demanding that the MIA change its pay practices and pay back wages and interest to the three women named in the case, as well as any other female employees who have similarly been paid less than men with the same job. The lawsuit claims the discrimination took place at the agency’s Baltimore office.

Statistics show that women may earn between 20 and 30 percent less than men across the board, in both the public and private sectors. According to the most recent Census data, for every $3,750 in monthly earnings made by men, women earned less than $3,000. That said, proving that the disparity is rooted purely in gender discrimination, as opposed to a whole host of other factors, such as job performance, is not easy. Though many companies would rather settle than endure a public legal battle, companies that choose to battle in court often win.

Case in point: last month a jury in San Francisco ruled in favor of private-equity firm Kleiner Perkins in a gender-discrimination suit brought by a fired female employee who alleged that both her firing and her lack of promotions prior to the firing occurred because she was a woman. The jury rejected her claims and instead found that Kleiner Perkins had taken appropriate steps to prevent gender discrimination and that the plaintiff’s firing and loss of promotion were based on other factors.

How the EEOC’s case against the Maryland Insurance Administration will play out is impossible to say at this point. Facts are still coming to light and the MIA has yet to have its day in court. We expect to provide updates and additional thoughts as the case progresses.

Please contact Alex J. Brown, Chair of the Insurance Law Department at Shapiro, Sher, Guinot & Sandler, and a former Assistant Attorney General and Senior Counsel to the Maryland Insurance Administration, at 410-385-4220.