Court Explains “Joint Employer” Doctrine; Finds it Inapplicable to Claim by US Tennis Association Subcontractor Employee

In Felder v. United States Tennis Association Inc., 17-cv-5045, 2018 WL 5621484 (S.D.N.Y. Oct. 30, 2018), the court, inter alia, explained and applied the :”joint employer” doctrine under Title VII of the Civil Rights Act of 1964.

In sum, plaintiff (a 50 year old black man) was employed by a security company (AJ Security) that appeared to be a sub-subcontractor of the United States Tennis Association. He sued the USTA, asserting discrimination based on race and age, as well as retaliation. While this decision includes a discussion of various issues – including administrative exhaustion and the election of remedies (as to his claims under state law) – here I will focus on the court’s discussion of the application of the so-called “joint employer” doctrine.

From the decision:

To hold an employer liable for unlawful employment practices under Title VII, an employer-employee relationship must have existed between the parties at the time of the alleged unlawful conduct.Kern v. City of Rochester, 93 F.3d 38, 44-45 (2d Cir. 1996). See also Gulino v. New York State Educ. Dep’t, 460 F.3d 361, 370 (2d Cir. 2006). The same substantive standards of Title VII also apply under § 1981. Vivenzio v. City of Syracuse, 611 F.3d 98, 106 (2d Cir. 2010). Title VII, by its terms, applies only to “employees,” 42 U.S.C. § 2000e(f). The Supreme Court has ruled that the definitions of “employee,” “employer,” and “employment” are to be determined under the common law of agency whenever statutes have failed to specifically define them. … The initial requirement under the common law agency test of employment is a “threshold showing that [the company] hired and compensated” a plaintiff. …

A plaintiff may also attempt to “assert employer liability against an entity that is not formally his or her employer” under the “single employer” or “joint employer” doctrines. Arculeo v. On-Site Sales & Mktg., L.L.C., 425 F.3d 193, 197 (2d Cir. 2005). The joint-employer doctrine holds that “an employee, formally employed by one entity, who has been assigned to work in circumstances that justify the conclusion that the employee is at the same time constructively employed by another entity, may impose liability for violations of employment law on the constructive employer, on the theory that this other entity is the employee’s joint employer.” …

Application of the joint-employer doctrine is particularly useful in situations – like this one – of “temporary employment or staffing agencies and their client entities.” Gilani, 2018 WL 4374002, at *5 (quoting Farzan v. Wells Fargo Bank, N.A., 2013 WL 6231615, at *16 (S.D.N.Y. 2013), subsequently aff’d sub. nom. Farzan v. Genesis 10, 619 F. App’x 15 (2d Cir 2015)). See also Liotard v. FedEx Freight Corp., 2016 WL 1071034, at *5 (S.D.N.Y. 2016) (noting that joint employer doctrine is particularly relevant in staffing agency circumstances). A determination that a third-party entity is acting as joint employer requires “sufficient evidence of immediate control over the employees.” Liotard, 2016 WL 1071034, at *4 (quoting Clinton’s Ditch, 778 F.2d at 138 (2d Cir. 1985)). The Second Circuit has identified five factors that bear on the “immediate control” inquiry: “whether the alleged joint employer (1) did the hiring and firing; (2) directly administered any disciplinary procedures; (3) maintained records of hours, handled the payroll, or provided insurance; (4) directly supervised the employees; or (5) participated in the collective bargaining process. … In the instant case, there is no allegation that the USTA exercised the type of control over Felder that would be necessary to establish a joint employer. Application of the joint employer doctrine in the staffing agency context is plausible when the staffing agency has actually placed its employee with the third party, with whom it shares immediate control over the employee. See, e.g., Gilani, 2018 WL 4374002; Liotard, 2016 WL 1071034.

Applying the law, the court dismissed plaintiff’s complaint, noting that plaintiff “has not alleged that the USTA shared immediate control over him with AJ Security or CSC, and thus joint employer liability is inapplicable.”

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