In Fierros v. Texas Dept. of Health, 274 F.3d 187 (5th Cir. 2001), the court held that the denial of pay raise constitutes ultimate employment decision.

In Kersting v. Wal-Mart Stores, Inc., 250 F.3d 1109, 1115-16 (7th Cir. 2001), the ADA plaintiff did not suffer an adverse employment action when he was not moved to a pay scale to which he was not entitled. Even though this was not a denial of a pay raise, the court explained that the denial of a pay raise is an adverse employment action:

   This court has held that the denial of a raise may constitute a material adverse action. Fyfe v. City of Fort Wayne, 241 F.3d 597, 602 (7th Cir. 2001) (citing Hunt, 219 F.3d at 654). That is because a raise may be a "normal and expected element" of a worker's salary, Fyfe, 241 F.3d at 602, that keeps his "wages from falling in real terms" due to the rate of inflation. Hunt, 219 F.3d at 654. Thus, denying a worker's raise may mean "cutting his wage in real terms." Id. Moreover, raises may be the normal way for a company to reward a worker's increased productivity that comes with experience on the job, and to satisfy a worker's legitimate expectations for a rising standard of living. Id.