## Facts

- Arizona offered state employees a voluntary deferred compensation plan allowing employees to defer salary to purchase retirement annuities.
- The State selected several private annuity companies to provide retirement benefit options under the plan.
- Each selected company used sex-based actuarial tables that paid women lower monthly annuity benefits than men who made identical contributions and retired at the same age.
- Nathalie Norris sued under Title VII on behalf of a class of female employees enrolled in, or who would enroll in, the plan, alleging sex discrimination in compensation.

## Issues

1. Whether Title VII prohibits a state employer from offering a deferred compensation plan using employer-selected annuity options that pay women lower monthly benefits than men for the same contributions.
2. If Title VII is violated, whether relief may require equal benefits based on contributions made before the Court’s decision, or must be limited to benefits derived from future contributions.

## Decision

- The Court held that offering employer-selected annuities that pay women lower monthly benefits than similarly situated men for the same contributions constitutes sex discrimination in violation of Title VII.
- The Court limited relief to prospective operation: retirement benefits derived from contributions made after the Court’s decision must be calculated without regard to sex.
- Benefits derived from contributions made before the decision could be calculated under the plan’s existing terms.
- The judgment below was affirmed in part, reversed in part, and remanded.

## Legal Principles

- Title VII applies to employer-provided retirement and deferred-compensation benefits as part of the employee’s compensation.
- An employer violates Title VII when, through its compensation arrangements (including selection of benefit providers), employees receive unequal retirement benefits solely because of sex, even if based on actuarial longevity data.
- Group-based actuarial generalizations about male/female life expectancy do not justify sex-based differences in individual employees’ compensation or benefit levels under Title VII.
- Courts may limit remedies in benefits cases to avoid substantial disruption and reliance costs, requiring sex-neutral calculation for benefits attributable to post-decision contributions while allowing pre-decision contributions to be administered under existing terms.

## Conclusion

The Court ruled that Arizona’s deferred compensation plan unlawfully discriminated by offering only annuities that paid women less than men for equal contributions, but required sex-neutral benefits only for amounts contributed after the decision, leaving benefits tied to earlier contributions unchanged.


Ariz. Governing Comm. for Tax Deferred Annuity & Deferred Comp. Plans v. Norris, 463 U.S. 1073 (1983)