"Different Location, Different Pay": Equal Pay Violations Hidden Behind Geography

Differences in pay are frequently attributed to location, yet geography alone does not automatically justify unequal salaries. Under New Jersey law, the analysis centers on the work performed, not simply on where it happens.

From our experience reviewing compensation structures at Brandon J. Broderick, we have found that location labels are sometimes used to mask unrelated decision-making. In practice, a geographic classification can serve as a proxy for other considerations rather than a genuine reflection of costs or labor market conditions.

Examples include a department being moved into a “lower market” designation, a remote employee being placed in a different pay band, or a satellite office being treated as its own compensation pool even though job duties remain unchanged. 

When employees performing substantially similar work receive different salaries solely because they are assigned to another branch, region, or territory, the disparity may implicate pay equity protections.

This article discusses how courts analyze location-based wage gaps, what qualifies as a legitimate business factor, how compensation must be tied to measurable criteria, which patterns tend to matter most, and when it may be appropriate to consult an equal pay lawyer in New Jersey.

The Legal Framework Governing Geographic Pay Discrimination In New Jersey And Federal Law

New Jersey maintains one of the country’s most expansive equity systems through the Diane B. Allen Equal Pay Act, incorporated into the New Jersey Law Against Discrimination (NJLAD). 

In general, employers may not pay a person in a protected class less than others performing substantially similar work. The comparison looks at the combined requirements of skill, effort, and responsibility.

State law and Division on Civil Rights guidance outline the limited defenses an employer may rely on. A wage gap must be supported by:

• a seniority system
• a merit system
• bona fide factors unrelated to a protected trait

Geography frequently appears among these claimed factors. Sometimes it reflects a real market condition. In other situations, it reflects assumptions or historical placement patterns, as certain groups have been concentrated in particular locations or offices.

Federal law can also apply. The federal Equal Pay Act addresses sex-based wage differences for substantially equal work within the same establishment, allowing defenses such as seniority, merit, production measures, or a factor other than sex. 

Title VII likewise covers compensation discrimination, and EEOC guidance explains how compensation practices and employer defenses are evaluated.

New Jersey’s salary history ban alsointersects with location-based decisions. Employers generally may not screen applicants based on past salary or require that their history meet compensation thresholds. 

This becomes important when geographic differences are justified with statements like, “that is what the candidate earned in that market.” In situations like these, speaking with an equal pay attorney in New Jersey can help clarify whether a location-based explanation is legally sound or masking an unlawful wage gap.

The Hidden Discrimination In Location-Based Pay Premiums In NJ

Some wage gaps do not exist between different companies. They exist within the same employer, across different locations.

One site becomes the “main” office. Recruiting is concentrated there, budgets are trending higher, and compensation bands are gradually rising. Other locations, such as suburban branches or back-office operations, are treated as support sites. Salary is lower and raises move more slowly, even though the work may be equally demanding.

This dynamic creates an internal location premium. It can be explained as market pay, but the explanation is not always tied to external labor conditions. Sometimes the difference reflects internal hierarchy rather than outside economics.

Signs of geography-based prestige can include:

• Higher-paid teams clustered near leadership despite comparable duties elsewhere.
• Employees told relocation is the only path to better compensation.
• The primary office is treated as the benchmark for “professional-level” work, while other sites are viewed as interchangeable labor.

A real market distinction can exist, but it should be specific and measurable. When the explanation amounts only to “that office pays more,” the issue shifts from economics to structure. The same pattern can appear in unequal training pay, where employees in preferred locations receive paid development time while others are expected to learn without comparable compensation.

Location can become a proxy for visibility, mentorship, and perceived value. If that proxy aligns with protected groups, the disparity may reflect a compensation system rather than neutral geography.

Remote Employees And Location-Driven Pay Inequality In New Jersey Workplaces

Remote work introduced a new geography question: the employer decides which location counts.

Some companies tie wages to their headquarters. Others use the employee’s home address. A worker may never enter the headquarters, but is paid according to the market. Or the employee supports a high-cost region in practice, while payroll classifies the role as low-cost.

This structure is not automatically unlawful. Risk increases when the company applies it inconsistently or changes the rule depending on the outcome.

In larger pay equity matters our specialists have built, one recurring pattern is timing. “HQ-based” is emphasized during recruitment to attract candidates. Later, when alignment or raises are requested, “local market rate” becomes the controlling explanation. 

In real life, this can look like:

• Two remote employees performing the same duties are paid differently because one is linked to headquarters and the other to a lower-cost region.
• Remote workers are excluded from higher office pay bands despite working within the same team structure.
• Remote status is treated as a separate compensation tier, even though the responsibilities and expectations match those of office roles.

Remote geography decisions can also lead to quiet re-leveling of job grades. Without any real change in duties, remote workers may be moved into lower compensation bands or narrower career tracks simply because they are not physically attached to a main office. The adjustment may look administrative, but it alters pay and advancement expectations.

The employer must show a legitimate, job-related factor that reasonably explains the difference. A policy that changes definitions over time can appear less like a real factor and more like a flexible justification.

Geographic Pay Gaps Rooted In NJ Legacy Branch Structures

An older office may have been built decades ago in a higher-wage market and given higher pay bands to attract talent. Over time, those rates became the baseline. Raises accumulated, bonuses stacked, and long-tenured employees preserved the structure.

Later, the company expands. A new location opens with leaner pay bands. The explanation is familiar: new cost model, separate market, different budget. The result can be two compensation realities for the same role inside one organization:

• An established office keeps historically higher salaries.
• A newer office starts lower and remains lower.

Legacy systems can maintain inequality while sounding neutral. If workers in the newer location disproportionately belong to protected groups, the structure can sustain wage gaps even in the absence of explicit bias. 

Confidential salary rules may reinforce this dynamic. Employers may discourage or prohibit workers from discussing compensation, making meaningful comparisons difficult. Without shared information, employees cannot easily see that identical roles across locations are paid differently.

Geography-Driven Commission Gaps: Territory Assignments Under NJ Law

Geography can shape how much a person earns. In commission-based positions, territory often determines opportunity. A higher-income region may produce larger transactions. An established territory may generate repeat clients. From what we have seen in practice, these structural differences often explain income gaps more than individual effort does.

When certain territories are consistently assigned to favored employees and others are not, compensation differences may appear to reflect performance when they actually reflect assignment decisions.

This issue is often overlooked because it does not appear in an hourly-rate comparison. It shows up in sales results that are later labeled merit-based:

• High-value zip codes are repeatedly assigned to the same employees
• Established accounts were transferred informally to select individuals.
• Newer employees are left to develop low-yield regions from scratch.
• Commission splits, draws, or quotas are adjusted by location without clear criteria.

Geographic assignments can be valid when applied consistently for real business reasons. They raise concerns when location becomes a mechanism for favoritism that aligns with protected characteristics.

Decentralized Pay Practices And Location-Driven Discrimination In New Jersey

When each location has its own manager setting starting salaries, approving raises, and awarding bonuses, differences develop quietly. Instead of one compensation system, the company ends up with many.

This structure is common in retail, health care, logistics, and multi-site professional services, and we also see it in corporate environments where branch offices operate with broad autonomy. In our work at Brandon J. Broderick, our legal team regularly encounters patterns such as:

• The same job title carries different salary ranges based on management style rather than market conditions
• One manager offers aggressive starting pay, while another enforces a strict cap.
• Similar performance leading to different raises because budgets vary by location

National wage data underscores why these disparities matter. In 2024, women earned about 85% of men’s median hourly wages across full- and part-time work: an improvement from roughly 81% in 2003, but still a measurable gap. 

From our experience, these differences rarely become visible on their own. In multi-location organizations, local discretion can allow compensation disparities to grow unnoticed until an employee compares notes or raises a concern, bringing the issue into focus for the first time.

How Regional Job Titles Can Mask Geographic Pay Discrimination

Different job titles are sometimes presented as the explanation for wage differences. 

One office labels a position “Coordinator.” Another calls it “Manager.” The duties, independence, and required skills may be comparable, yet the compensation differs. The employer points to the wording as proof that the jobs are separate.

Titles may suggest distinction, but in many organizations, they simply reflect local tradition rather than real differences in function. Regional title masking can appear as:

• Lower-paid locations keep “junior” titles even after responsibilities grow
• Higher-paid offices are expanding titles without meaningful changes in work.
• Title differences are used to avoid aligning hourly rates during transfers between locations.

This dynamic shapes how people understand the workplace. If everyone accepts that the roles are different, the pay gap becomes easier to overlook. Yet when the underlying duties remain comparable, a title alone does not justify unequal compensation.

It also connects to salary history rules. A lower title produces lower compensation, and if that history is later used to justify future compensation, the disparity reinforces itself. New Jersey generally restricts the use of salary history as a gatekeeping tool.

When Geography Becomes The After-The-Fact Explanation

One of the clearest warning signs appears when location is raised only after a pay question is asked.

At hiring, the role may be described as company-wide. Compensation is negotiated using broad comparators. Then, once alignment or parity is requested, the explanation shifts: “That office pays differently.” 

When geography surfaces only after a challenge, it can suggest that the label is being used to defend the status quo rather than to reflect a genuine business factor.

If your compensation has been justified differently at different stages, it may be worth a closer look. 

Contact us today for a free case review to discuss your situation and explore available options.