Both the Age Discrimination in Employment Act and the Equal Pay Act apply. The Equal Pay Act requires that employers pay equal wages to men and women who perform jobs that require substantially equal skill, effort and responsibility, and that are performed under similar working conditions within the same establishment. Differentials in pay are permitted only when they are based on seniority, merit, quantity or quality of production, or a factor other than sex.
The employer's comments regarding retirement and the need for young men to keep the work unit "vital and growth-oriented" suggest that age is a factor in employment decisions. Unless the employer can demonstrate that age is a bona fide occupational qualification (BFOQ), i.e., reasonably necessary to the normal operation of its business, its actions are prohibited.
The employer's situation also constitutes a violation of Title VII of the 1964 Civil Rights Act, as it appears that the employer is engaging in a practice of considering gender in making salary decisions. The remark that female employees should stay with the company for retirement purposes despite lower pay suggests that women are being treated differently than men solely based on gender.
In this case, the EEOC required the employer to review its compensation practices for instances of age and sex discrimination and make salary adjustments. Given her background and experience, the woman was eventually awarded a higher salary than her male counterpart. In correcting a pay differential, the Equal Pay Act prohibits an employer from reducing the pay of the higher paid employee; instead, the law requires that pay of the lower paid employee(s) be increased.