National Litigation Hotline

Writing for a 7-2 Court, Justice John Paul Stevens noted that the professional corporation was a 'new type of business entity that has no exact precedent in common law.' The Court thus adopted a six-point test urged by the EEOC as the most appropriate way of determining whether individuals in such organizations should be considered 'employees.' In so holding, the Supreme Court was 'persuaded by the EEOC's focus on the common-law touchstone of control.' The Court emphasized the Restatement (Second) of Agency '2(2) definition of 'servant,' which means an individual 'whose work is 'controlled or is subject to the right to control by the master.” Stevens wrote that the common-law element of control is the 'principal guidepost that should be followed in this case' and that the 'extent of control' was the key factor in this consideration. The EEOC test examines six factors: 1) whether the organization can hire or fire the individual or set rules and regulations about the individual's work; 2) whether the organization can supervise the individual's work; 3) whether the individual reports to someone higher in the organization; 4) how much ability, if any, the individual has to influence the organization; 5) whether the parties intended the individual to be an employee based on written agreements and contracts; and 6) whether the individual shares in the profits, losses, and liabilities of the organization.

The Court also held, however, that the EEOC factors are not to be considered 'exhaustive.' Quoting the Supreme Court's decision in Nationwide Mut. Inc. Co. v. Darden, 503 U.S. 318 (1992), Stevens wrote that the answer to whether a shareholder-director is an employee depends on ”all of the incidents of the relationship ' with no one factor being decisive.” The majority also rejected Clackamas' argument that a consideration of who should be deemed an 'employee' for anti-discrimination law purposes should depend on whether the individual in question looked more like an 'employee' or a 'partner' in a traditional partnership. 'Today,' Stevens wrote, 'there are partnerships that include hundreds of members, some of who may well qualify as 'employees' because control is concentrated in a small number of managing partners ' Thus, asking whether shareholder-directors are partners ' rather than asking whether they are employees 'simply begs the question.'

One-eyed Worker Fails to Prove Company Regarded Him As Disabled

The Seventh Circuit has held that while a jury could infer that a steel company regarded a one-eyed warehouse worker as disabled, the worker failed to prove that he could perform the essential functions of his position. Dyke v. O'Neal Steel Inc., 2003 U.S. App. LEXIS 8480 (7th Cir. May 5).

Michael Dyke, who had lost one eye in a mugging, began working temporarily at O'Neal Steel in November 1998. In his warehousing position, Dyke was asked to load metal sheeting onto a conveyor belt and onto pallets, positioning sheeting in a metal bender, and using various metalworking machines and tools. Although Dyke's supervisor encouraged him to apply for a permanent position after he had spent 2 weeks on the job, a personnel assistant informed Dyke that the company would not hire him because he had only one eye. The assistant later confirmed her statement with O'Neal Steel's human resources department, who informed her that Dyke would not be able to pass the company's vision test and should not be hired. The company then released Dyke from his temporary position, citing safety concerns. Dyke sued under the ADA. The district court granted summary judgment to the company, holding that, while Dyke may have been regarded as disabled, he could not perform the essential functions of either the temporary or the permanent position.

The Seventh Circuit affirmed. It first assumed that Dyke's termination amounted to an adverse employment action. The court then explained that a plaintiff could prove he was 'regarded as' disabled, so as to bring him within the class protected by the ADA, if he could show that his employer mistakenly believed that he had an impairment that substantially limited one or more major life activities. Dyke argued that the company believed that his lack of one eye substantially limited the major life function of seeing. While the court observed that mere institution of a company vision test was insufficient to show that a company regarded employee unable to pass the test as substantially limited, it agreed that the record in Dyke's case supported an inference that O'Neal Steel regarded Dyke as disabled. However, ultimately finding in favor of Dyke's former employer, the Seventh Circuit went on to hold that Dyke had failed to show that he could perform the essential functions of his job. An expert had testified in the trial court that the company's vision standards were appropriate and that workers unable to meet those standards could be a danger to themselves and others. The court found that Dyke had failed to introduce evidence that he would have been able to pass the vision test and that, accordingly, he could not perform the essential functions of either the temporary or permanent positions.

Several-Year Lapse Before Discharge Does Not Undercut Causal Connection

A district court erred in holding that a 6-year lapse between an employee's filing of an EEOC charge and her discharge meant that she could not establish the causal nexus necessary to support a Title VII retaliation claim, the Fifth Circuit recently held. Fabela v. Socorro Indep. Sch. Dist., 2003 U.S. App. LEXIS 7768 (5th Cir. Apr. 24).

Alicia Fabela began working as a secretary for the Socorro School District in 1986. Later in her employment, she became the campus secretary at an elementary school. Soon after she began working at the elementary school in 1991, the school's principal gave Fabela a poor evaluation and recommended her for termination. Fabela then filed a charge of discrimination with the EEOC, alleging that the principal had made unwelcome sexual comments to her. After an investigation, the EEOC concluded that there was no cause to believe that Fabela had suffered the discrimination she alleged, but that she was free to pursue her claims in court.

Fabela was retained as an employee despite her poor evaluation from the principal and was later transferred to another school, where she worked for 5 years without incident. However, in 1997, her new principal gave her another poor evaluation. When the principal attempted to discuss the evaluation with Fabela, she became upset and left the campus. The principal then recommended her discharge to the district superintendent, the same man who had approved her transfer to the new school. The superintendent agreed with the principal. Fabela appealed this recommendation at a district hearing, the superintendent argued that Fabela's discharge was warranted and cited the 1991 EEOC no-probable-cause finding as evidence that she was a 'problem employee.' When Fabela was fired, she filed another EEOC charge and eventually brought a Title VII retaliation action against the school district. The district court ruled that Fabela's 1991 EEOC charge was too distant temporally from her firing to constitute evidence of retaliation.

The Fifth Circuit reversed the district court. In Title VII retaliation actions, the court explained, a plaintiff may establish evidence of retaliation in two ways. First, she may produce direct evidence of retaliatory intent as part of a 'mixed motive' analysis. Second, she may introduce circumstantial evidence under the McDonnell-Douglas burden-shifting analysis. '[I]n the unusual instance where a plaintiff is able to support the elements of her claim with direct evidence of a retaliatory motive, the McDonnell Douglas framework does not apply.' Instead, where such direct evidence is presented, the burden of proof then shifts to the employer to show that it would have made the decision to discharge an employee regardless of the retaliatory motive. The Fifth Circuit went on to hold that Fabela's introduction of the superintendent's comments at her termination hearing, as direct evidence of discriminatory intent, allowed her to set forth the elements of her retaliation claim.

D.C. Circuit Upholds NLRB 'Single Employer' Determination

The Court of Appeals for the District of Columbia Circuit has upheld a finding of the National Labor Relations Board that two Miami contractors sharing the same headquarters and run by the same corporate officers are a single employer for federal labor law purposes. RC Aluminum Indus., Inc. v. NLRB, (D.C. Cir. Apr. 25).

RC Aluminum Industries, Inc. (RCA) manufactures windows, doors and handrails at its facilities in Miami, FL. It then transports its products to high-rise constructions all over Florida, where RC Erectors, Inc. (RCE) installs the products. RCA and RCE share the same corporate officers, and RCA's president handled labor matters for both companies. Moreover, RCA fabricated and transported the products that RCE installed. Finally, RCA made some benefits payments on behalf of RCE. Based on these facts, the NRLB Regional Director found that RCA and RCE constituted a single employer under the National Labor Relations Act and that their respective employees could be joined in a single bargaining unit.

The D.C. Circuit upheld the Regional Director's determination. National Labor Relations Board authority directs that bargaining units composed of employees of more than one employer be permitted 'only when employers participate voluntarily,' the court wrote. Here, RCA and RCE did not agree to participate in multi-employer bargaining, so the Regional Director could not approve a bargaining unit including both companies' employees unless he determined that the companies constituted a single employer. In arriving at a 'single employer' determination, the Board considers whether the two companies have common management, centralized control of labor relations, inter-relation of operations, and common ownership. In light of these factors, the court held, the Regional Director had appropriately determined that RCA and RCE formed a single employer because of the high degree of common management, inter-relation of operations, and centralized control of labor relations by RCA's president. The Court also upheld the Regional Director's determination to include installers from both RCA and RCE in a single unit, finding that although each company had at least one foreman at each construction site who had the authority to hire, fire, or discipline installers, both companies' foremen reported to the same superintendent, who visited all the sites daily, and had significant supervision and control of hiring and firing.

Dreadlocked Officer Singled Out for Religious Discrimination

The Fourth Circuit has revived a Rastafarian correctional officer's race and religion discrimination claims, holding that the district court failed to give appropriate weight to evidence that a Maryland correctional facility permitted other deviations from its dress code, but subject the Rastafarian officer to escalating discipline for his refusal to cut his dreadlocks. Booth v. Maryland, 2003 U.S. App. LEXIS 8156 (4th Cir. Apr. 30).

Jonathan F. Booth was hired in 1996 as a correctional officer at the Baltimore Central Booking and Intake Center. As a practitioner of the Rastafarian religion, Booth wore dreadlocks. His dreadlocks were braided, short, and kept tucked against his scalp. Booth was informed that his hairstyle violated the institution's dress code and grooming standards, and was asked to cut his hair several times. After these several requests, Booth informed the facility's warden in writing that he was a member of the Rastafarian religion and that he wore his dreadlocks for religious reasons. Despite this explanation, however, Booth's supervisors subjected him to progressive discipline. Booth then complained within the institution that he was the victim of discrimination. Booth was also required to attend 'disciplinary mitigation conferences,' where he again stated that he wore the haircut for religious reasons. At one such conference, Booth argued that he was being subjected to bias, noting that in 1995, two other employees, one Jewish and the other Sikh, were granted religious exemptions to the grooming policy and that at least 13 other employees violated the division's grooming policies. When Booth filed a suit alleging religious discrimination, the trial court rejected Booth's disparate treatment religious discrimination claim, granting summary judgment for the facility. In so holding, the trial court found that the facility's policy was facially neutral and rationally related to enhancing 'safety, uniformity, discipline, and esprit de corps' among the correctional staff at the facility. The court further found that Booth's 'disparate application' claim was pre-empted by Title VII.

The Fourth Circuit disagreed, and reversed the lower court on Booth's religious discrimination claim, holding that Booth's 'disparate application' religious discrimination claim was not pre-empted by Title VII. The court observed that one line of Fourth Circuit cases had held that Title VII was not the exclusive remedy for public sector employment discrimination, a third case rejected that reasoning in dicta. The court therefore concluded that, while the conflicting lines of authority would require clarification by an en banc review of the issue by the entire Fourth Circuit, the court was 'unpersuaded that the viability of a ' 1983 claim hinged upon whether a plaintiff pleads a Title VII claim alongside it' and that Booth should therefore be permitted to proceed with his claims.

State Worker May Bring Title VII Claim with Letter from EEOC

Citing equitable considerations, the Tenth Circuit has held that an employee of the State of Oklahoma may proceed with her suit under Title VII of the Civil Rights Act of 1964, even without a letter from the U.S. Attorney General. Hiller v. Oklahoma, (10th Cir. May 6).

When an employee's current or former employer is a private entity, the employee may bring suit after receiving a right-to-sue letter, or a notice of dismissal of an EEOC charge of discrimination, from the EEOC. However, where the current or former employer is a 'government, government agency, or political subdivision,' the EEOC may only investigate, attempt conciliation, and refer the case to the attorney general, who has the authority under the statute to sue the government entity. If the commission dismisses the charge or 180 days have passed without the federal government filing suit, 'the Commission, or the Attorney General in a case involving a government, government agency, or political subdivision, shall so notify the person aggrieved and within 90 days after the giving of such notice a civil action may be brought ' by the person claiming to be aggrieved.' Willa Hiller sued the Oklahoma Used Motor Vehicle & Parts Commission under Title VII. The Commission moved for, and won, summary judgment against Hiller on the ground that she had failed to meet a jurisdictional prerequisite of Title VII by filing suit after receiving a right-to-sue letter from the EEOC, but not from the Attorney General.

The Tenth Circuit reversed, holding that barring Hiller's suit because of her failure to obtain authorization from the Attorney General put her in a 'catch-22' conflict between the requirements of Title VII and the work-sharing arrangement between the EEOC and the Department of Justice. In an effort to reduce duplication of paperwork, the agreement between the EEOC and the DOJ provides that the EEOC will refer governmental employer cases to the Attorney General if it finds reasonable cause for discrimination. Here, Hiller's attorney had asked the EEOC to rescind its notice letter, but the EEOC refused, and the district court granted summary judgment to the state before Hiller could receive a right-to-sue letter from the Attorney General. The DOJ ultimately refused to issue a right-to-sue letter. In reversing the district court's grant of summary judgment, the Tenth Circuit held that equitable considerations dictated that Hiller's claim should not be precluded by the DOJ's refusal to issue a right-to-sue letter, which was totally beyond her control.

Michael Dyke, who had lost one eye in a mugging, began working temporarily at O'Neal Steel in November 1998. In his warehousing position, Dyke was asked to load metal sheeting onto a conveyor belt and onto pallets, position sheeting in a metal bender, and use various metalworking machines and tools. Although Dyke's supervisor encouraged him to apply for a permanent position after he had spent 2 weeks on the job, a personnel assistant informed Dyke that the company would not hire him because he had only one eye. The assistant later confirmed her statement with O'Neal Steel's human resources department, who informed her that Dyke would not be able to pass the company's vision test and should not be hired. The company then released Dyke from his temporary position, citing safety concerns. Dyke sued under the ADA. The district court granted summary judgment to the company, holding that, while Dyke may have been regarded as disabled, he could not perform the essential functions of either the temporary or the permanent position.

The Seventh Circuit affirmed. It first assumed that Dyke's termination amounted to an adverse employment action. The court then explained that a plaintiff could prove he was 'regarded as' disabled, so as to bring him within the class protected by the ADA, if he could show that his employer mistakenly believed that he had an impairment that substantially limited one or more major life activities. Dyke argued that the company believed his lack of one eye substantially limited the major life function of seeing. While the court observed that mere institution of a company vision test was insufficient to show that a company regarded employees unable to pass the test as substantially limited, it agreed that the record in Dyke's case supported an inference that O'Neal Steel regarded Dyke as disabled. However, ultimately finding in favor of Dyke's former employer, the Seventh Circuit went on to hold that Dyke had failed to show that he could perform the essential functions of his job. An expert had testified in the trial court that the company's vision standards were appropriate and that workers unable to meet those standards could be a danger to themselves and others. The court found that Dyke had failed to introduce evidence that he would have been able to pass the vision test and that, accordingly, he could not perform the essential functions of either the temporary or permanent positions.A district court erred in holding that a 6-year lapse between an employee's filing of an EEOC charge and her discharge meant that she could not establish the causal nexus necessary to support a Title VII retaliation claim, the Fifth Circuit recently held. Fabela v. Socorro Indep. Sch. Dist., 2003 U.S. App. LEXIS 7768 (5th Cir. Apr. 24).

Alicia Fabela began working as a secretary for the Socorro School District in 1986. Later in her employment, she became the campus secretary at an elementary school. Soon after she began working at the elementary school in 1991, the school's principal gave Fabela a poor evaluation and recommended her for termination. Fabela then filed a charge of discrimination with the EEOC, alleging that the principal had made unwelcome sexual comments to her. After an investigation, the EEOC concluded that there was no cause to believe that Fabela had suffered the discrimination she alleged, but that she was free to pursue her claims in court.

Fabela was retained as an employee despite her poor evaluation from the principal and was later transferred to another school, where she worked for 5 years without incident. However, in 1997, her new principal gave her another poor evaluation. When the principal attempted to discuss the evaluation with Fabela, she became upset and left the campus. The principal then recommended her discharge to the district superintendent, the same man who had approved her transfer to the new school. The superintendent agreed with the principal. Fabela appealed this recommendation at a district hearing. The superintendent argued that Fabela's discharge was warranted and cited the 1991 EEOC no-probable-cause finding as evidence that she was a 'problem employee.' When Fabela was fired, she filed another EEOC charge and eventually brought a Title VII retaliation action against the school district. The district court ruled that Fabela's 1991 EEOC charge was too distant temporally from her firing to constitute evidence of retaliation.

The Fifth Circuit reversed the district court. In Title VII retaliation actions, the court explained, a plaintiff may establish evidence of retaliation in two ways. First, she may produce direct evidence of retaliatory intent as part of a 'mixed motive' analysis. Second, she may introduce circumstantial evidence under the McDonnell-Douglas burden-shifting analysis. '[I]n the unusual instance where a plaintiff is able to support the elements of her claim with direct evidence of a retaliatory motive, the McDonnell Douglas framework does not apply.' Instead, where such direct evidence is presented, the burden of proof then shifts to the employer to show that it would have made the decision to discharge an employee regardless of the retaliatory motive. The Fifth Circuit went on to hold that Fabela's introduction of the superintendent's comments at her termination hearing, as direct evidence of discriminatory intent, allowed her to set forth the elements of her retaliation claim.The Court of Appeals for the District of Columbia Circuit has upheld a finding of the National Labor Relations Board that two Miami contractors sharing the same headquarters and run by the same corporate officers are a single employer for federal labor law purposes. RC Aluminum Indus., Inc. v. NLRB, (D.C. Cir. Apr. 25).

RC Aluminum Industries, Inc. (RCA) manufactures windows, doors and handrails at its facilities in Miami, FL. It then transports its products to high-rise constructions all over Florida, where RC Erectors, Inc. (RCE) installs the products. RCA and RCE share the same corporate officers, and RCA's president handled labor matters for both companies. Moreover, RCA fabricated and transported the products that RCE installed. Finally, RCA made some benefits payments on behalf of RCE. Based on these facts, the NRLB Regional Director found that RCA and RCE constituted a single employer under the National Labor Relations Act and that their respective employees could be joined in a single bargaining unit.

The D.C. Circuit upheld the Regional Director's determination. National Labor Relations Board authority directs that bargaining units composed of employees of more than one employer be permitted 'only when employers participate voluntarily,' the court wrote. Here, RCA and RCE did not agree to participate in multi-employer bargaining, so the Regional Director could not approve a bargaining unit including both companies' employees unless he determined that the companies constituted a single employer. In arriving at a 'single employer' determination, the Board considers whether the two companies have common management, centralized control of labor relations, inter-relation of operations, and common ownership. In light of these factors, the court held, the Regional Director had appropriately determined that RCA and RCE formed a single employer because of the high degree of common management, inter-relation of operations, and centralized control of labor relations by RCA's president. The Court also upheld the Regional Director's determination to include installers from both RCA and RCE in a single unit, finding that although each company had at least one foreman at each construction site who had the authority to hire, fire, or discipline installers, both companies' foremen reported to the same superintendent, who visited all the sites daily, and had significant supervision and control of hiring and firing.The Fourth Circuit has revived a Rastafarian correctional officer's race and religion discrimination claims, holding that the district court failed to give appropriate weight to evidence that a Maryland correctional facility permitted other deviations from its dress code, but subjected the Rastafarian officer to escalating discipline for his refusal to cut his dreadlocks. Booth v. Maryland, 2003 U.S. App. LEXIS 8156 (4th Cir. Apr. 30).

Jonathan F. Booth was hired in 1996 as a correctional officer at the Baltimore Central Booking and Intake Center. As a practitioner of the Rastafarian religion, Booth wore dreadlocks. His dreadlocks were braided, short, and kept tucked against his scalp. Booth was informed that his hairstyle violated the institution's dress code and grooming standards, and was asked to cut his hair several times. After these several requests, Booth informed the facility's warden in writing that he was a member of the Rastafarian religion and that he wore his dreadlocks for religious reasons. Despite this explanation, however, Booth's supervisors subjected him to progressive discipline. Booth then complained within the institution that he was the victim of discrimination. Booth was also required to attend 'disciplinary mitigation conferences,' where he again stated that he wore the haircut for religious reasons. At one such conference, Booth argued that he was being subjected to bias, noting that in 1995, two other employees, one Jewish and the other Sikh, were granted religious exemptions to the grooming policy and that at least 13 other employees violated the division's grooming policies. When Booth filed a suit alleging religious discrimination, the trial court rejected Booth's disparate treatment religious discrimination claim, granting summary judgment for the facility. In so holding, the trial court found that the facility's policy was facially neutral and rationally related to enhancing 'safety, uniformity, discipline, and esprit de corps' among the correctional staff at the facility. The court further found that Booth's 'disparate application' claim was pre-empted by Title VII.

The Fourth Circuit disagreed, and reversed the lower court on Booth's religious discrimination claim, holding that Booth's 'disparate application' religious discrimination claim was not pre-empted by Title VII. The court observed that one line of Fourth Circuit cases had held that Title VII was not the exclusive remedy for public sector employment discrimination, a third case rejected that reasoning in dicta. The court therefore concluded that, while the conflicting lines of authority would require clarification by an en banc review of the issue by the entire Fourth Circuit, the court was 'unpersuaded that the viability of a ' 1983 claim hinged upon whether a plaintiff pleads a Title VII claim alongside it' and that Booth should therefore be permitted to proceed with his claims.Citing equitable considerations, the Tenth Circuit has held that an employee of the State of Oklahoma may proceed with her suit under Title VII of the Civil Rights Act of 1964, even without a letter from the U.S. Attorney General. Hiller v. Oklahoma, (10th Cir. May 6).

When an employee's current or former employer is a private entity, the employee may bring suit after receiving a right-to-sue letter, or a notice of dismissal of an EEOC charge of discrimination, from the EEOC. However, where the current or former employer is a 'government, government agency, or political subdivision,' the EEOC may only investigate, attempt conciliation, and refer the case to the attorney general, who has the authority under the statute to sue the government entity. If the commission dismisses the charge or 180 days have passed without the federal government filing suit, 'the Commission, or the Attorney General in a case involving a government, government agency, or political subdivision, shall so notify the person aggrieved and within 90 days after the giving of such notice a civil action may be brought ' by the person claiming to be aggrieved.' Willa Hiller sued the Oklahoma Used Motor Vehicle & Parts Commission under Title VII. The Commission moved for, and won, summary judgment against Hiller on the ground that she had failed to meet a jurisdictional prerequisite of Title VII by filing suit after receiving a right-to-sue letter from the EEOC, but not from the Attorney General.

The Tenth Circuit reversed, holding that barring Hiller's suit because of her failure to obtain authorization from the Attorney General put her in a 'catch-22' conflict between the requirements of Title VII and the work-sharing arrangement between the EEOC and the Department of Justice. In an effort to reduce duplication of paperwork, the agreement between the EEOC and the DOJ provides that the EEOC will refer governmental employer cases to the Attorney General if it finds reasonable cause for discrimination. Here, Hiller's attorney had asked the EEOC to rescind its notice letter, but the EEOC refused, and the district court granted summary judgment to the state before Hiller could receive a right-to-sue letter from the Attorney General. The DOJ ultimately refused to issue a right-to-sue letter. In reversing the district court's grant of summary judgment, the Tenth Circuit held that equitable considerations dictated that Hiller's claim should not be precluded by the DOJ's refusal to issue a right-to-sue letter, which was totally beyond her control.

The National Litigation Hotline was prepared by the labor and employment department of Winston & Strawn's New York office.

Supreme Court Adopts EEOC Guidance on Who Is 'Employee'

The United States Supreme Court has held that a determination of who is an 'employee' of a professional medical corporation for federal anti-discrimination law purposes rests on Equal Employment Opportunity Commission (EEOC) guidance, which focuses on the common law's emphasis on right to control. Clackamas Gastroenterology Associates v. Wells, 123 S. Ct. 1673; 155 L. Ed. 2d 615 (U.S. May 24).

In so holding, the high court remanded Deborah Wells' American with Disabilities Act suit against Clackamas Gastroenterology Associates to the U.S. Court of Appeals for the Ninth Circuit to rule on whether shareholders were employees based on the EEOC test. The Ninth Circuit had held that the physician-shareholders of Clackamas Gastroenterology Associates were technically 'employees' that could be counted towards the minimum number of employees necessary to bring a company within the ambit of the ADA.

Writing for a 7-2 Court, Justice John Paul Stevens noted that the professional corporation was a 'new type of business entity that has no exact precedent in common law.' The Court thus adopted a six-point test urged by the EEOC as the most appropriate way of determining whether individuals in such organizations should be considered 'employees.' In so holding, the Supreme Court was 'persuaded by the EEOC's focus on the common-law touchstone of control.' The Court emphasized the Restatement (Second) of Agency '2(2) definition of 'servant,' which means an individual 'whose work is 'controlled or is subject to the right to control by the master.” Stevens wrote that the common-law element of control is the 'principal guidepost that should be followed in this case' and that the 'extent of control' was the key factor in this consideration. The EEOC test examines six factors: 1) whether the organization can hire or fire the individual or set rules and regulations about the individual's work; 2) whether the organization can supervise the individual's work; 3) whether the individual reports to someone higher in the organization; 4) how much ability, if any, the individual has to influence the organization; 5) whether the parties intended the individual to be an employee based on written agreements and contracts; and 6) whether the individual shares in the profits, losses, and liabilities of the organization.

The Court also held, however, that the EEOC factors are not to be considered 'exhaustive.' Quoting the Supreme Court's decision in Nationwide Mut. Inc. Co. v. Darden, 503 U.S. 318 (1992), Stevens wrote that the answer to whether a shareholder-director is an employee depends on ”all of the incidents of the relationship ' with no one factor being decisive.” The majority also rejected Clackamas' argument that a consideration of who should be deemed an 'employee' for anti-discrimination law purposes should depend on whether the individual in question looked more like an 'employee' or a 'partner' in a traditional partnership. 'Today,' Stevens wrote, 'there are partnerships that include hundreds of members, some of who may well qualify as 'employees' because control is concentrated in a small number of managing partners ' Thus, asking whether shareholder-directors are partners ' rather than asking whether they are employees 'simply begs the question.'

One-eyed Worker Fails to Prove Company Regarded Him As Disabled

The Seventh Circuit has held that while a jury could infer that a steel company regarded a one-eyed warehouse worker as disabled, the worker failed to prove that he could perform the essential functions of his position. Dyke v. O'Neal Steel Inc., 2003 U.S. App. LEXIS 8480 (7th Cir. May 5).

Michael Dyke, who had lost one eye in a mugging, began working temporarily at O'Neal Steel in November 1998. In his warehousing position, Dyke was asked to load metal sheeting onto a conveyor belt and onto pallets, positioning sheeting in a metal bender, and using various metalworking machines and tools. Although Dyke's supervisor encouraged him to apply for a permanent position after he had spent 2 weeks on the job, a personnel assistant informed Dyke that the company would not hire him because he had only one eye. The assistant later confirmed her statement with O'Neal Steel's human resources department, who informed her that Dyke would not be able to pass the company's vision test and should not be hired. The company then released Dyke from his temporary position, citing safety concerns. Dyke sued under the ADA. The district court granted summary judgment to the company, holding that, while Dyke may have been regarded as disabled, he could not perform the essential functions of either the temporary or the permanent position.

The Seventh Circuit affirmed. It first assumed that Dyke's termination amounted to an adverse employment action. The court then explained that a plaintiff could prove he was 'regarded as' disabled, so as to bring him within the class protected by the ADA, if he could show that his employer mistakenly believed that he had an impairment that substantially limited one or more major life activities. Dyke argued that the company believed that his lack of one eye substantially limited the major life function of seeing. While the court observed that mere institution of a company vision test was insufficient to show that a company regarded employee unable to pass the test as substantially limited, it agreed that the record in Dyke's case supported an inference that O'Neal Steel regarded Dyke as disabled. However, ultimately finding in favor of Dyke's former employer, the Seventh Circuit went on to hold that Dyke had failed to show that he could perform the essential functions of his job. An expert had testified in the trial court that the company's vision standards were appropriate and that workers unable to meet those standards could be a danger to themselves and others. The court found that Dyke had failed to introduce evidence that he would have been able to pass the vision test and that, accordingly, he could not perform the essential functions of either the temporary or permanent positions.

Several-Year Lapse Before Discharge Does Not Undercut Causal Connection

A district court erred in holding that a 6-year lapse between an employee's filing of an EEOC charge and her discharge meant that she could not establish the causal nexus necessary to support a Title VII retaliation claim, the Fifth Circuit recently held. Fabela v. Socorro Indep. Sch. Dist., 2003 U.S. App. LEXIS 7768 (5th Cir. Apr. 24).

Alicia Fabela began working as a secretary for the Socorro School District in 1986. Later in her employment, she became the campus secretary at an elementary school. Soon after she began working at the elementary school in 1991, the school's principal gave Fabela a poor evaluation and recommended her for termination. Fabela then filed a charge of discrimination with the EEOC, alleging that the principal had made unwelcome sexual comments to her. After an investigation, the EEOC concluded that there was no cause to believe that Fabela had suffered the discrimination she alleged, but that she was free to pursue her claims in court.

Fabela was retained as an employee despite her poor evaluation from the principal and was later transferred to another school, where she worked for 5 years without incident. However, in 1997, her new principal gave her another poor evaluation. When the principal attempted to discuss the evaluation with Fabela, she became upset and left the campus. The principal then recommended her discharge to the district superintendent, the same man who had approved her transfer to the new school. The superintendent agreed with the principal. Fabela appealed this recommendation at a district hearing, the superintendent argued that Fabela's discharge was warranted and cited the 1991 EEOC no-probable-cause finding as evidence that she was a 'problem employee.' When Fabela was fired, she filed another EEOC charge and eventually brought a Title VII retaliation action against the school district. The district court ruled that Fabela's 1991 EEOC charge was too distant temporally from her firing to constitute evidence of retaliation.

The Fifth Circuit reversed the district court. In Title VII retaliation actions, the court explained, a plaintiff may establish evidence of retaliation in two ways. First, she may produce direct evidence of retaliatory intent as part of a 'mixed motive' analysis. Second, she may introduce circumstantial evidence under the McDonnell-Douglas burden-shifting analysis. '[I]n the unusual instance where a plaintiff is able to support the elements of her claim with direct evidence of a retaliatory motive, the McDonnell Douglas framework does not apply.' Instead, where such direct evidence is presented, the burden of proof then shifts to the employer to show that it would have made the decision to discharge an employee regardless of the retaliatory motive. The Fifth Circuit went on to hold that Fabela's introduction of the superintendent's comments at her termination hearing, as direct evidence of discriminatory intent, allowed her to set forth the elements of her retaliation claim.

D.C. Circuit Upholds NLRB 'Single Employer' Determination

The Court of Appeals for the District of Columbia Circuit has upheld a finding of the National Labor Relations Board that two Miami contractors sharing the same headquarters and run by the same corporate officers are a single employer for federal labor law purposes. RC Aluminum Indus., Inc. v. NLRB, (D.C. Cir. Apr. 25).

RC Aluminum Industries, Inc. (RCA) manufactures windows, doors and handrails at its facilities in Miami, FL. It then transports its products to high-rise constructions all over Florida, where RC Erectors, Inc. (RCE) installs the products. RCA and RCE share the same corporate officers, and RCA's president handled labor matters for both companies. Moreover, RCA fabricated and transported the products that RCE installed. Finally, RCA made some benefits payments on behalf of RCE. Based on these facts, the NRLB Regional Director found that RCA and RCE constituted a single employer under the National Labor Relations Act and that their respective employees could be joined in a single bargaining unit.

The D.C. Circuit upheld the Regional Director's determination. National Labor Relations Board authority directs that bargaining units composed of employees of more than one employer be permitted 'only when employers participate voluntarily,' the court wrote. Here, RCA and RCE did not agree to participate in multi-employer bargaining, so the Regional Director could not approve a bargaining unit including both companies' employees unless he determined that the companies constituted a single employer. In arriving at a 'single employer' determination, the Board considers whether the two companies have common management, centralized control of labor relations, inter-relation of operations, and common ownership. In light of these factors, the court held, the Regional Director had appropriately determined that RCA and RCE formed a single employer because of the high degree of common management, inter-relation of operations, and centralized control of labor relations by RCA's president. The Court also upheld the Regional Director's determination to include installers from both RCA and RCE in a single unit, finding that although each company had at least one foreman at each construction site who had the authority to hire, fire, or discipline installers, both companies' foremen reported to the same superintendent, who visited all the sites daily, and had significant supervision and control of hiring and firing.

Dreadlocked Officer Singled Out for Religious Discrimination

The Fourth Circuit has revived a Rastafarian correctional officer's race and religion discrimination claims, holding that the district court failed to give appropriate weight to evidence that a Maryland correctional facility permitted other deviations from its dress code, but subject the Rastafarian officer to escalating discipline for his refusal to cut his dreadlocks. Booth v. Maryland, 2003 U.S. App. LEXIS 8156 (4th Cir. Apr. 30).

Jonathan F. Booth was hired in 1996 as a correctional officer at the Baltimore Central Booking and Intake Center. As a practitioner of the Rastafarian religion, Booth wore dreadlocks. His dreadlocks were braided, short, and kept tucked against his scalp. Booth was informed that his hairstyle violated the institution's dress code and grooming standards, and was asked to cut his hair several times. After these several requests, Booth informed the facility's warden in writing that he was a member of the Rastafarian religion and that he wore his dreadlocks for religious reasons. Despite this explanation, however, Booth's supervisors subjected him to progressive discipline. Booth then complained within the institution that he was the victim of discrimination. Booth was also required to attend 'disciplinary mitigation conferences,' where he again stated that he wore the haircut for religious reasons. At one such conference, Booth argued that he was being subjected to bias, noting that in 1995, two other employees, one Jewish and the other Sikh, were granted religious exemptions to the grooming policy and that at least 13 other employees violated the division's grooming policies. When Booth filed a suit alleging religious discrimination, the trial court rejected Booth's disparate treatment religious discrimination claim, granting summary judgment for the facility. In so holding, the trial court found that the facility's policy was facially neutral and rationally related to enhancing 'safety, uniformity, discipline, and esprit de corps' among the correctional staff at the facility. The court further found that Booth's 'disparate application' claim was pre-empted by Title VII.

The Fourth Circuit disagreed, and reversed the lower court on Booth's religious discrimination claim, holding that Booth's 'disparate application' religious discrimination claim was not pre-empted by Title VII. The court observed that one line of Fourth Circuit cases had held that Title VII was not the exclusive remedy for public sector employment discrimination, a third case rejected that reasoning in dicta. The court therefore concluded that, while the conflicting lines of authority would require clarification by an en banc review of the issue by the entire Fourth Circuit, the court was 'unpersuaded that the viability of a ' 1983 claim hinged upon whether a plaintiff pleads a Title VII claim alongside it' and that Booth should therefore be permitted to proceed with his claims.

State Worker May Bring Title VII Claim with Letter from EEOC

Citing equitable considerations, the Tenth Circuit has held that an employee of the State of Oklahoma may proceed with her suit under Title VII of the Civil Rights Act of 1964, even without a letter from the U.S. Attorney General. Hiller v. Oklahoma, (10th Cir. May 6).

When an employee's current or former employer is a private entity, the employee may bring suit after receiving a right-to-sue letter, or a notice of dismissal of an EEOC charge of discrimination, from the EEOC. However, where the current or former employer is a 'government, government agency, or political subdivision,' the EEOC may only investigate, attempt conciliation, and refer the case to the attorney general, who has the authority under the statute to sue the government entity. If the commission dismisses the charge or 180 days have passed without the federal government filing suit, 'the Commission, or the Attorney General in a case involving a government, government agency, or political subdivision, shall so notify the person aggrieved and within 90 days after the giving of such notice a civil action may be brought ' by the person claiming to be aggrieved.' Willa Hiller sued the Oklahoma Used Motor Vehicle & Parts Commission under Title VII. The Commission moved for, and won, summary judgment against Hiller on the ground that she had failed to meet a jurisdictional prerequisite of Title VII by filing suit after receiving a right-to-sue letter from the EEOC, but not from the Attorney General.

The Tenth Circuit reversed, holding that barring Hiller's suit because of her failure to obtain authorization from the Attorney General put her in a 'catch-22' conflict between the requirements of Title VII and the work-sharing arrangement between the EEOC and the Department of Justice. In an effort to reduce duplication of paperwork, the agreement between the EEOC and the DOJ provides that the EEOC will refer governmental employer cases to the Attorney General if it finds reasonable cause for discrimination. Here, Hiller's attorney had asked the EEOC to rescind its notice letter, but the EEOC refused, and the district court granted summary judgment to the state before Hiller could receive a right-to-sue letter from the Attorney General. The DOJ ultimately refused to issue a right-to-sue letter. In reversing the district court's grant of summary judgment, the Tenth Circuit held that equitable considerations dictated that Hiller's claim should not be precluded by the DOJ's refusal to issue a right-to-sue letter, which was totally beyond her control.

Michael Dyke, who had lost one eye in a mugging, began working temporarily at O'Neal Steel in November 1998. In his warehousing position, Dyke was asked to load metal sheeting onto a conveyor belt and onto pallets, position sheeting in a metal bender, and use various metalworking machines and tools. Although Dyke's supervisor encouraged him to apply for a permanent position after he had spent 2 weeks on the job, a personnel assistant informed Dyke that the company would not hire him because he had only one eye. The assistant later confirmed her statement with O'Neal Steel's human resources department, who informed her that Dyke would not be able to pass the company's vision test and should not be hired. The company then released Dyke from his temporary position, citing safety concerns. Dyke sued under the ADA. The district court granted summary judgment to the company, holding that, while Dyke may have been regarded as disabled, he could not perform the essential functions of either the temporary or the permanent position.

The Seventh Circuit affirmed. It first assumed that Dyke's termination amounted to an adverse employment action. The court then explained that a plaintiff could prove he was 'regarded as' disabled, so as to bring him within the class protected by the ADA, if he could show that his employer mistakenly believed that he had an impairment that substantially limited one or more major life activities. Dyke argued that the company believed his lack of one eye substantially limited the major life function of seeing. While the court observed that mere institution of a company vision test was insufficient to show that a company regarded employees unable to pass the test as substantially limited, it agreed that the record in Dyke's case supported an inference that O'Neal Steel regarded Dyke as disabled. However, ultimately finding in favor of Dyke's former employer, the Seventh Circuit went on to hold that Dyke had failed to show that he could perform the essential functions of his job. An expert had testified in the trial court that the company's vision standards were appropriate and that workers unable to meet those standards could be a danger to themselves and others. The court found that Dyke had failed to introduce evidence that he would have been able to pass the vision test and that, accordingly, he could not perform the essential functions of either the temporary or permanent positions.A district court erred in holding that a 6-year lapse between an employee's filing of an EEOC charge and her discharge meant that she could not establish the causal nexus necessary to support a Title VII retaliation claim, the Fifth Circuit recently held. Fabela v. Socorro Indep. Sch. Dist., 2003 U.S. App. LEXIS 7768 (5th Cir. Apr. 24).

Alicia Fabela began working as a secretary for the Socorro School District in 1986. Later in her employment, she became the campus secretary at an elementary school. Soon after she began working at the elementary school in 1991, the school's principal gave Fabela a poor evaluation and recommended her for termination. Fabela then filed a charge of discrimination with the EEOC, alleging that the principal had made unwelcome sexual comments to her. After an investigation, the EEOC concluded that there was no cause to believe that Fabela had suffered the discrimination she alleged, but that she was free to pursue her claims in court.

Fabela was retained as an employee despite her poor evaluation from the principal and was later transferred to another school, where she worked for 5 years without incident. However, in 1997, her new principal gave her another poor evaluation. When the principal attempted to discuss the evaluation with Fabela, she became upset and left the campus. The principal then recommended her discharge to the district superintendent, the same man who had approved her transfer to the new school. The superintendent agreed with the principal. Fabela appealed this recommendation at a district hearing. The superintendent argued that Fabela's discharge was warranted and cited the 1991 EEOC no-probable-cause finding as evidence that she was a 'problem employee.' When Fabela was fired, she filed another EEOC charge and eventually brought a Title VII retaliation action against the school district. The district court ruled that Fabela's 1991 EEOC charge was too distant temporally from her firing to constitute evidence of retaliation.

The Fifth Circuit reversed the district court. In Title VII retaliation actions, the court explained, a plaintiff may establish evidence of retaliation in two ways. First, she may produce direct evidence of retaliatory intent as part of a 'mixed motive' analysis. Second, she may introduce circumstantial evidence under the McDonnell-Douglas burden-shifting analysis. '[I]n the unusual instance where a plaintiff is able to support the elements of her claim with direct evidence of a retaliatory motive, the McDonnell Douglas framework does not apply.' Instead, where such direct evidence is presented, the burden of proof then shifts to the employer to show that it would have made the decision to discharge an employee regardless of the retaliatory motive. The Fifth Circuit went on to hold that Fabela's introduction of the superintendent's comments at her termination hearing, as direct evidence of discriminatory intent, allowed her to set forth the elements of her retaliation claim.The Court of Appeals for the District of Columbia Circuit has upheld a finding of the National Labor Relations Board that two Miami contractors sharing the same headquarters and run by the same corporate officers are a single employer for federal labor law purposes. RC Aluminum Indus., Inc. v. NLRB, (D.C. Cir. Apr. 25).

RC Aluminum Industries, Inc. (RCA) manufactures windows, doors and handrails at its facilities in Miami, FL. It then transports its products to high-rise constructions all over Florida, where RC Erectors, Inc. (RCE) installs the products. RCA and RCE share the same corporate officers, and RCA's president handled labor matters for both companies. Moreover, RCA fabricated and transported the products that RCE installed. Finally, RCA made some benefits payments on behalf of RCE. Based on these facts, the NRLB Regional Director found that RCA and RCE constituted a single employer under the National Labor Relations Act and that their respective employees could be joined in a single bargaining unit.

The D.C. Circuit upheld the Regional Director's determination. National Labor Relations Board authority directs that bargaining units composed of employees of more than one employer be permitted 'only when employers participate voluntarily,' the court wrote. Here, RCA and RCE did not agree to participate in multi-employer bargaining, so the Regional Director could not approve a bargaining unit including both companies' employees unless he determined that the companies constituted a single employer. In arriving at a 'single employer' determination, the Board considers whether the two companies have common management, centralized control of labor relations, inter-relation of operations, and common ownership. In light of these factors, the court held, the Regional Director had appropriately determined that RCA and RCE formed a single employer because of the high degree of common management, inter-relation of operations, and centralized control of labor relations by RCA's president. The Court also upheld the Regional Director's determination to include installers from both RCA and RCE in a single unit, finding that although each company had at least one foreman at each construction site who had the authority to hire, fire, or discipline installers, both companies' foremen reported to the same superintendent, who visited all the sites daily, and had significant supervision and control of hiring and firing.The Fourth Circuit has revived a Rastafarian correctional officer's race and religion discrimination claims, holding that the district court failed to give appropriate weight to evidence that a Maryland correctional facility permitted other deviations from its dress code, but subjected the Rastafarian officer to escalating discipline for his refusal to cut his dreadlocks. Booth v. Maryland, 2003 U.S. App. LEXIS 8156 (4th Cir. Apr. 30).

Jonathan F. Booth was hired in 1996 as a correctional officer at the Baltimore Central Booking and Intake Center. As a practitioner of the Rastafarian religion, Booth wore dreadlocks. His dreadlocks were braided, short, and kept tucked against his scalp. Booth was informed that his hairstyle violated the institution's dress code and grooming standards, and was asked to cut his hair several times. After these several requests, Booth informed the facility's warden in writing that he was a member of the Rastafarian religion and that he wore his dreadlocks for religious reasons. Despite this explanation, however, Booth's supervisors subjected him to progressive discipline. Booth then complained within the institution that he was the victim of discrimination. Booth was also required to attend 'disciplinary mitigation conferences,' where he again stated that he wore the haircut for religious reasons. At one such conference, Booth argued that he was being subjected to bias, noting that in 1995, two other employees, one Jewish and the other Sikh, were granted religious exemptions to the grooming policy and that at least 13 other employees violated the division's grooming policies. When Booth filed a suit alleging religious discrimination, the trial court rejected Booth's disparate treatment religious discrimination claim, granting summary judgment for the facility. In so holding, the trial court found that the facility's policy was facially neutral and rationally related to enhancing 'safety, uniformity, discipline, and esprit de corps' among the correctional staff at the facility. The court further found that Booth's 'disparate application' claim was pre-empted by Title VII.

The Fourth Circuit disagreed, and reversed the lower court on Booth's religious discrimination claim, holding that Booth's 'disparate application' religious discrimination claim was not pre-empted by Title VII. The court observed that one line of Fourth Circuit cases had held that Title VII was not the exclusive remedy for public sector employment discrimination, a third case rejected that reasoning in dicta. The court therefore concluded that, while the conflicting lines of authority would require clarification by an en banc review of the issue by the entire Fourth Circuit, the court was 'unpersuaded that the viability of a ' 1983 claim hinged upon whether a plaintiff pleads a Title VII claim alongside it' and that Booth should therefore be permitted to proceed with his claims.Citing equitable considerations, the Tenth Circuit has held that an employee of the State of Oklahoma may proceed with her suit under Title VII of the Civil Rights Act of 1964, even without a letter from the U.S. Attorney General. Hiller v. Oklahoma, (10th Cir. May 6).

When an employee's current or former employer is a private entity, the employee may bring suit after receiving a right-to-sue letter, or a notice of dismissal of an EEOC charge of discrimination, from the EEOC. However, where the current or former employer is a 'government, government agency, or political subdivision,' the EEOC may only investigate, attempt conciliation, and refer the case to the attorney general, who has the authority under the statute to sue the government entity. If the commission dismisses the charge or 180 days have passed without the federal government filing suit, 'the Commission, or the Attorney General in a case involving a government, government agency, or political subdivision, shall so notify the person aggrieved and within 90 days after the giving of such notice a civil action may be brought ' by the person claiming to be aggrieved.' Willa Hiller sued the Oklahoma Used Motor Vehicle & Parts Commission under Title VII. The Commission moved for, and won, summary judgment against Hiller on the ground that she had failed to meet a jurisdictional prerequisite of Title VII by filing suit after receiving a right-to-sue letter from the EEOC, but not from the Attorney General.

The Tenth Circuit reversed, holding that barring Hiller's suit because of her failure to obtain authorization from the Attorney General put her in a 'catch-22' conflict between the requirements of Title VII and the work-sharing arrangement between the EEOC and the Department of Justice. In an effort to reduce duplication of paperwork, the agreement between the EEOC and the DOJ provides that the EEOC will refer governmental employer cases to the Attorney General if it finds reasonable cause for discrimination. Here, Hiller's attorney had asked the EEOC to rescind its notice letter, but the EEOC refused, and the district court granted summary judgment to the state before Hiller could receive a right-to-sue letter from the Attorney General. The DOJ ultimately refused to issue a right-to-sue letter. In reversing the district court's grant of summary judgment, the Tenth Circuit held that equitable considerations dictated that Hiller's claim should not be precluded by the DOJ's refusal to issue a right-to-sue letter, which was totally beyond her control.

The National Litigation Hotline was prepared by the labor and employment department of Winston & Strawn's New York office.