Interns, volunteers, graduate students, even prisoners – these are just some examples of categories of people who might be deemed “employees” of an organization under Title VII, depending on the conditions of their work and how they might be compensated for their services. The Sixth Circuit, in a 2-1 panel decision, declares a split with the Second Circuit and holds that remuneration is only one factor – not a threshold factor – in the judicial determination about whether volunteer workers should count as employees.
Bryson v. Middlefield Volunteer Fire Dep’t, No. 10-3055 (6th Cir. Sept. 2, 2011): The plaintiff, who served as a firefighter-member and administrative assistant, alleged that Fire Chief Anderson “subjected her to unwanted sexual advances, requests for sexual favors, and other verbal and physical contact of a sexual nature, including, for example, that Anderson demanded sexual favors in return for pay raises.” The fire department replied that “firefighter-members were not employees because they received only de minimis benefits for their services.” The district court agreed, granting summary judgment to the employer on the ground that the firefighters did not earn “significant remuneration,” and thus were not “employees,” borrowing an analytical framework adopted in United States v. City of New York, 359 F.3d 83, 92 (2d Cir. 2004), cert. denied, 543 U.S. 1146 (2005).
The Sixth Circuit reverses. While the unanimous panel concurs on a remand of the case to the district court, the judges divide on the grounds. Judge Moore’s majority opinion notes that the issue of who counts as an “employee” of a volunteer organization is one of first impression in the circuit:
“We have applied the common-law agency test . . . to determine whether an employment relationship exists under different statutes, particularly in the context of distinguishing employees from independent contractors. . . . However, we have not considered the issue of employment relationships in the context of a volunteer.”
The Second Circuit, in the United States v. City of New York case, had held that a plaintiff must show that she was a “hired party” who received “substantial benefits not merely incidental to the activity performed,” before a district court can apply the multifactor, common-law agency test that establishes control over the person’s work.
The panel majority here holds, instead, that remuneration is simply one factor, not a controlling factor, in establishing an employment relationship. Citing Nationwide Mut. Ins. Co. v. Darden, 503 U.S. 318 (1992), and Cmty. for Creative Non-Violence v. Reid, 490 U.S. 730 (1989), the panel finds no grounds for a precondition of “significant remuneration”:
“Our decision to consider remuneration as a factor when determining whether a employment relationship exists comports with Darden‘s instruction that, when evaluating a particular relationship, ‘ ‘all of the incidents of the relationship must be assessed and weighed with no one factor being decisive.’ ‘ Darden, 503 U.S. at 324 . . . . ‘[T]he extent of control . . . is not dispositive,’ ‘ and several of the factors listed in Darden and Reid relate to financial matters. . . .To be sure, ‘[t]he degree of importance of each factor [will vary] depending on the occupation and the factual context in which the services are performed.’ . . . . But no one factor, including remuneration, is decisive, and therefore no one factor is an independent antecedent requirement.”
Concurring and dissenting in part, Judge Gibbons would adhere to the Second Circuit formulation – avoiding a circuit split – but hold on the record presented that Bryson made a sufficient showing to establish “significant remuneration”:
“Here, Bryson has offered evidence that the volunteer firefighters in her department received benefits including workers’ compensation coverage, insurance coverage, gift cards amounting to $300 or less, training, access to an emergency fund, and personal use of the department’s facilities and assets. I would therefore remand this case in order for a jury to decide the disputed issue of ‘whether the benefits represent indirect but significant remuneration . . . or inconsequential incidents of an otherwise gratuitous relationship.'”