i want to know if this is legal for an employer to do

The answer depends on whether there is some restriction, either contractual or statutory, on your employer's right to pay employees whatever they agree upon.  Do you have a contract with your employer which provides that you will receive the same pay as others in your position?  Is there a collective bargaining agreement (union contract) which sets wages for workers of your type?  Do you believe that the employer is discriminating against you on some basis which is prohibited by statute (e.g. because of your race, gender, religion, ethnicity, etc.) or that the employer is favoring the other employee for an unlawful reason (e.g. in return for sexual favors).  If the answer to each of the above questions is no, then the employer can pay any employee whatever he has agreed with each employee, subject to minimum wage laws.