New EEOC Lawsuit Highlights the Danger of Providing Unequal Benefits to New Parents Based Upon Gender

On August 30, 2017, the Equal Employment Opportunity Commission (“EEOC”) announced that it filed a lawsuit against cosmetics giant Estée Lauder, alleging the company’s parental leave program illegally discriminates against new fathers.

In 2015, an Estée Lauder employee in Maryland notified the company’s benefits administrator of the birth of his child and his intent to be the child’s primary care giver.  Estée Lauder provided employees paid leave for childbirth and baby bonding, as well as flexible return-to-work benefits at the end of the leave.  Mothers and fathers received different benefits.  New mothers received six weeks of paid parental leave for baby bonding while new fathers received two weeks of paid baby bonding leave, except in surrogacy situations where the father was the “primary caregiver.”  In such cases, fathers received six weeks of paid leave.  In response to the father’s request for a leave, Estée Lauder informed him that he was only entitled to two weeks, despite his intent to be the child’s primary caregiver.

The employee filed a charge with the EEOC, alleging Estée Lauder’s policy violated federal law prohibiting discrimination in pay or benefits on the basis of sex.  The EEOC agreed with the employee, and after an unsuccessful attempt at a pre-litigation settlement, the EEOC filed a lawsuit against Estée Lauder seeking compensatory and punitive damages on behalf of a class of thousands of employees.

What Employers Should Know

Employers that choose to provide baby bonding benefits must not distinguish between the sexes if they wish to avoid scrutiny from the EEOC, and potentially other fair employment practices agencies.  While employers may grant health-related pregnancy benefits to new mothers only, baby bonding leave is applicable to both parents. Employers with pregnancy-related benefit plans, especially those that exceed federal or state requirements, are encouraged to consult with counsel to ensure compliance with all applicable laws.