From JDSupra, J. William Manuel and Anne Yuengert discuss a recent case in which a security guard working for a security firm alleged that he was discriminated against by the United States Tennis Association and the Second Circuit said he had to allege
There has been a lot of discussion over the last few years about the joint employer test for liability under employment statutes. Whether it be Uber drivers in California or the back and forth over the Trump administration’s change of DOL rules, it can be hard to follow. This week, the Second Circuit Court of Appeals joined several other circuits in trying to outline what a court should examine when determining if an employee has joint employers.
U.S. Open Not Open for This Security Guard
Sean Felder is a security guard who had worked for a contractor that provided seasonal security for the United States Tennis Association. In 2012, Felder complained that African American security guards were given inferior assignments as compared to white guards at the U.S. Open. The parties settled that case. In 2016, Felder began working for another security company, AJ Security, which also provided security for USTA events. AJ Security assigned Felder to work at the U.S. Open in 2016. However, when he went to pick up his credentials, he was told his name was not in the system. His supervisor at AJ Security told him that the USTA denied him credentials due to his past complaint about racial discrimination. Felder sued the USTA for race discrimination and retaliation.
Lower Court Calls Felder’s Claims “OUT”
The USTA filed a motion to dismiss pointing out that he had never applied for a position with the USTA and therefore, the USTA was not his employer. The lower court agreed and held that Felder had not established that an employee-employer relationship existed at the time of the alleged discrimination. The court noted that Felder was not a formal employee of the USTA and was never compensated by the USTA. In looking at whether the USTA was a joint employer, the court stated that Felder had not alleged that the USTA shared control over him. The court gave Felder a chance to amend his complaint, which he did, but the court held that even the amended allegations did not meet the requisite standard for a joint employer finding.
Second Circuit Discussion
Felder appealed to the Second Circuit. That court recognized that Felder’s burden was to show that he had an employee-employer relationship with the USTA. The court stated that in certain circumstances, an employee can properly assert a claim against a company that is “not formally his or her employer.” The joint employer doctrine only comes into play where “an employee, formally employed by one entity is assigned to work in circumstances that the employee is at the same time constructively employed by another entity.”
The court admitted that it had not yet fully described a test for what constitutes joint employment in the context of Title VII. In looking at the statute itself, the court found that the definitions of employee and employer there were “circular” and not helpful. Instead, the court turned to the common law of agency. Under that structure, the court would apply a set of non-exhaustive factors that look to the element of control. The factors examine whether the alleged joint employer had the power to hire, fire or modify the terms and conditions of the employee’s employment.
When applying this test to Felder’s case, the court looked at case law dealing with independent contractors — even though Title VII protects employees, not independent contractors. As such, a plaintiff who claims discrimination in not being hired must plead that if hired, he would have been more like a traditional employee than an independent contractor. To succeed, the plaintiff would need to show that the alleged employer would have exerted control over the terms and conditions of the anticipated employment by, for example, “training, supervising, and disciplining [him].”
The court noted that Felder’s complaint did not allege that USTA exerted any control over AJ Security’s hiring process or that it would be involved in training him, supervising him, issuing his paychecks, or providing him a uniform. Felder only alleged that USTA refused to give him credentials to work the U.S. Open. The court held that was not enough to render the USTA a joint employer. Without further allegations, the Second Circuit said that the lower court properly dismissed the case. However, since Felder’s lawyer said that they could cure the deficiencies in the complaint if allowed to amend, the Second Circuit was willing to give him another chance.
What Did We Learn About Joint Employment?
As we have seen in other opinions in other areas, the key to the joint employer inquiry is control. If you exercise significant control over training, work assignments, scheduling, or recordkeeping, even if the person works for another company, you may find yourself liable as a joint employer. If you are using contractors in your workplace, be sure the relationship is well-defined and documented. The contractor needs to control the majority of the employee’s conduct and assignments or you could find yourself a joint employer.