Compensating Your Employees Fairly: A Guide to Internal Pay Equity

Types of Discrimination in Compensation

Under U.S. law, two main theories of discrimination are recognized by the courts. According to Ramona Paetzhold and Steven Willborn, these theories “reflect the two different conceptions of the behaviors and processes that produce discriminatory results.”¹ One theory focuses on the intent of the decision maker; discrimination occurs when a decision maker acts with discriminatory intent, known as disparate treatment. The other theory focuses on the policies and procedures used by the decision maker; discrimination occurs when a given policy or procedure has disproportionate effects on members of different ...