Norwegian Embassy in Minnesota Owes $271,594.00 For Violating Equal Pay Act

The case Ewald v. Royal Norwegian Embassy et al is emblematic of recent equal pay cases in several disturbing ways. After it was decided to create a new “Honorary Consulate” in Minneapolis, Minnesota, the Norwegian Embassy (“the Embassy”) set a budget of about $150,000 to be divided between two new expert positions to be staffed by local personnel. The purpose of both positions was to “build upon and strengthen the relationship between the Midwest and Norway through focused efforts to increase collaboration in two key strategic areas: (1) business and innovation; and (2) education and research.”

The positions had different titles: one was an “Innovation and Business Development Officer,” and the other a “Higher Education and Research Officer.” However, the written plans for the two positions, their job descriptions, and almost all testimony about the rationale for creating these positions made clear that they were supposed to be parallel, “inextricably linked,” equal-level positions with “almost identical responsibilities.”

Two candidates quickly rose to the top of the two hiring pools. Anders Davidson and Ellen Ewald were informally offered the two positions, each at a salary of $60,000. There was no negotiation with either candidate, although both had earned far more in the private sector prior to accepting their new positions. In both cases, they assumed that the salary they had been offered was fixed by the Embassy’s budet and not negotiable.

Shortly after they had agreed to accept their respective offers, however, something magical happened: the parties immediately responsible for these hiring decisions did some independent research and simply manufactured reasons to pay Davidson more than Ewald. The contracts they ended up offering to these two candidates, for these two ostensibly equal positions, were valued at $100,000 for Mr. Davidson and $70,000 for Ms. Ewald. To argue that this is not a clear violation of the Equal Pay Act and the Minnesota Human Rights Act, the Embassy would have needed some non-gender-based justification for it. They had none.

Officially, the reason for this salary differential was that their research had revealed that a business specialist had a higher market value than an education specialist. But the Court was extremely critical of this “research” process: the hiring managers had inquired about his prior income, but not hers; they had inquired about his need for day care for his children, but not hers; and they had based their decision on about one hour’s worth of completely unspecific research about the relative compensation levels in the fields of business and education (although in fact neither of these positions was in either of those fields). Finally, the Embassy representatives had sought and received approval from high-level administrators to offer Davidson over $40,000 more than Ewald–although the Court ultimately concluded that they did this by intentionally misleading their higher-level administrators.

In addition, Davidson was provided health insurance for himself and his family, while Ewald was told that she would not get the same benefit. The official reason for this was that Ewald’s spouse earned income independently, but there was no question that Davidson’s spouse earned income and he was provided insurance without ever requesting it. He received reimbursement for travel expenses when she did not.

So here we have a case of two people in similar, officially equal-level positions, and the American representatives of the Norwegian Embassy making a gratuitous decision to pay a male employee much more a female employee. One further set of facts makes this situation especially ironic (and given the emotional devastation visited on Ewald through this process, also tragic): she had far more business experience than Davidson had, was more valuable than he was based on previous earnings, and by all accounts performed far better than he did on the job. She was more qualified and more skilled, but earned less and was denied many of the benefits he received. Worst of all, she was embarrassed to discover that Davidson knew that he was earning $40,000 more, and almost everyone in the organization also knew this, but she hadn’t been given this information.

The Court awarded Ewald $170,594 in lost wages and $100,000 for emotional distress damages. The extent to which she will be able to recover from this experience emotionally, and overcome the damage to her reputation, remains to be seen.

Perhaps the Norwegians, who have far more gender-egalitarian policies and work culture, will see this case as a reason to think twice before trusting Americans with any hiring decisions.

If you believe your employer has discriminated against you on the basis of your sex, please contact The Harman Firm, LLP.