Independent contractors and Title VII

Independent contractors and Title VII

Holtzman v The World Book Company Inc., USDC, EDPa.

It is not uncommon for a public employer to engage the services of an “independent contractor” to perform certain tasks.

In deciding the Title VII complaint filed Arlene Holtzman, a former employee of the World Book Company, Senior U.S. District Court Judge Lowell A. Reed Jr. ruled that Title VII protects workers who are “employees,” but does not apply to independent contractors.

According to the decision, Holtzman's position was “outsourced” by World Book and she became an “independent contractor” although she performed essentially the same duties she had performed as a World Book employee. This change in status, said Judge Reed, meant that Title VII no longer was applicable as Title VII only covers applicants for employment and employees.*

The court noted that in 1995 World Book reorganize its sales operations. As a result, it negotiated contracts with individuals designated “regional directors.” When Holtzman was told of the new arrangement, she approached Rosemarie Lee, a former World Book branch manager. Lee had formed her own corporation, Leer Services. Leer's sales force included a number of former World Book sales representatives. Holtzman signed a contract with Leer Services.

Was Holtzman an employee, and if so, whose employee? Judge Reed said that the U.S. Supreme Court set out a number of factors to be considered in determining whether or not an individual is an employee or an independent contractor in Nationwide Mutual Insurance Company v Darden, 503 US 318.

The Supreme Court's “common law test” for determining who qualifies as an “employee” in Darden lists the following factors to be considered in making the determination:

1. The hiring party's right to control the manner and means by which the work is accomplished.

2. The skill required;

3. The source of the supplies and tools used by the individual;

4. The location of the work;

5. The duration of the relationship between the parties;

6. Whether the hiring party has the right to assign additional duties or projects to the hired party;

7. The extent of the hired party's discretion over when and how long to work;

8. The method of payment;

9. The hired party's role in hiring and paying assistants;

10. Whether the work is part of the regular business of the hiring party;

11. Whether the hired party is in business;

12. Whether the hiring party provides employee benefits; and

13. The tax treatment of the hired party.”

Applying the Darden factors to Arlene Holtzman's position selling World Book's educational products, Reed found that her status had clearly changed in 1995 from employee to independent contractor and thus she was not able to maintain her Title VII action.

* Title VII defines the term “employee” as “an individual employed by an employer ....”

Investigation of an anonymous “phone tip” by the appointing authority

Investigation of an anonymous “phone tip” by the appointing authority

Matter of Civil Serv. Employees Assn., Inc., Local 1000, AFSCME, AFL-CIO v New York State Pub. Empl. Relations Bd., 35 A.D.3d 1005

One of the issues considered in resolving an appeal from PERB’s dismissal of an improper practice charge alleging retaliation for participation in “protected union activities” involved the employer’s investigation of an “anonymous tip” concerning an employee.

Frank Williams, a union local president, was employed at the State University of New York Purchase [SUNY]. A “vocal and active president, filing many grievances on behalf of union members,” Williams contended (1) his reassignment from the evening and weekend shift to a weekday shift and (2) SUNY’s investigation of the status of his driver's license after receiving an anonymous tip constitute improper practices within the meaning of the Taylor Law (Civil Service Law § 209-a [a], [c]). Williams contended that these acts were in retaliation for his participation in protected union activities.

Ultimately PERB dismissed the improper practice charge.

CSEA appealed and the Appellate Division said “Substantial evidence supports [PERB’s] finding that SUNY's reassignment of Williams was unrelated to his union activities, and was instead in furtherance of SUNY's operating needs”

As to SUNY's investigation of Williams' driver's license, when SUNY received an “anonymous phone tip that Williams did not have a valid driver's license,” it ran a search in a statewide database. The court said that it was reasonable for SUNY to verify that Williams was a licensed driver, as he drove his vehicle onto campus for each shift and employees in his department had access to state vehicles, even if he personally never drove one.

Affirming PERB’s dismissal of the improper practice charge, the Appellate Division noted that SUNY’s investigation revealed that Williams did not possess a New York driver's license but was licensed in Rhode Island, despite having lived in New York State for over 30 years.

As this decision demonstrates, anonymous allegation may pose a serious problem for the administrator. The allegations may be false, made as a result of malice or may simply be a mistake on the part of the accuser. Nevertheless, it is necessary for the administrator to assume the charges are valid and undertake an investigation of the matter.

Such an investigation probably need not be as intensive as would be the case were the allegations made by a supervisor in the normal course of business or by a known party. However, the administrator should satisfy himself or herself that there is no substance to the allegation. If the investigation reveals that there is some substance to the allegations, and if true would constitute misconduct, further action should be taken by the administrator.

Anonymous communications that allege improper conduct by an employee place the appointing authority on the horns of a dilemma. If the employer ignores the communication, it may later develop that there was some substance to the allegation, and the employer will be exposed to criticism (or liability) for failing to act “on the information.” On the other hand, if the appointing authority confronts the employee, relying solely on the information it received anonymously, it may be criticized for taking adverse action against the employee based on such information alone. Such was the situation that faced the appointing authority after it received an anonymous letter alleging that one it its firefighters, Scott Wilson, was using illegal drugs.

Wilson v City of White Plains, 95 NY2d 783, sets out the standard applied by the Court of Appeals when it considered the actions taken by White Plains based on its receiving anonymous information alleging Wilson was using illegal drugs.

White Plains ordered Wison to submit to blood and urine. Ultimately disciplinary charges were filed against Wilson. A hearing officer found Wilson guilty of six charges of misconduct. The Commissioner of Public Safety adopted the findings and recommendations of the hearing officer and dismissed Wilson from his position. Wilson appealed his termination and persuaded the Appellate Division that his removal was arbitrary. In annulling Wilson’s dismissal the Appellate Division said that “in directing [Wilson] to submit to blood and urine tests, the fire department officials “relied upon an unsubstantiated and anonymous letter” and that there “was no objective evidence which would have suggested that the [firefighter] was abusing alcohol or drugs.”

The Court of Appeals disagreed and reversed the Appellate Division’s determination.

According to the high court, in addition to its receiving an “anonymous letter” concerning Wilson’s alleged use of drugs, “the City presented evidence of Wilson’s physical manifestations of substance abuse the day he was tested, long record of excessive absences, prior substance abuse problems, reputation for showing up at work under the influence, as well as his understanding that he could be tested if he showed any signs of recurring substance abuse.”

Statements contained in a disciplinary post-hearing brief may be considered by the appointing authority to support its conclusions

Statements contained in a disciplinary post-hearing brief may be considered by the appointing authority to support its conclusions

Sisco v Board of Trustees, 288 AD2d 230

The Board of Trustees of the Village of Havestraw dismissed police officer Keith Sisco after finding him guilty of disciplinary charges alleging misconduct filed against him.

Sisco appealed, contending that he had been denied a fair hearing because the Board incorporated portions of the Police Department's written post-hearing brief its determination. In effect, claimed Sisco, the inclusion of such statements indicated that the Board had ceded it decision-making powers to the Department.

The Appellate Division rejected Sisco's arguments, in effect indicating that there was nothing improper in the decision maker referring to, or including, statements set out in a post-hearing brief to support its conclusions.

The court also said that the Board's determination was supported by substantial evidence in the record, including Sisco's admissions in the related criminal charges brought against him. The court did not appear to have difficulty in allowing the use of such admissions in a subsequent administrative disciplinary action based on the same alleged acts of misconduct.

Indeed, a guilty verdict in a criminal court automatically serves to establish guilt in an administrative disciplinary hearing involving the same events.  In Kelly v Levin, 440 NYS2d 424, the court ruled that is a reversible error for an administrative disciplinary tribunal to acquit an employee if the individual has been found guilty of a criminal act involving the same allegations.

Reasonable accommodation under the Americans With Disabilities Act

Reasonable accommodation under the Americans With Disabilities Act

Lovejoy-Wilson v NOCO Motor Fuel, CA2, 263 F.3d 208

The Lovejoy-Wilson case points out that offering a disabled individual one reasonable accommodation will not necessarily excuse the employer from considering subsequent requests for an alternative accommodation submitted by the individual.

Diane Lovejoy-Wilson suffers from epilepsy and experiences seizures of varying seriousness on practically a daily basis. Because of her epilepsy and New York State's requirement that an epileptic be seizure-free for two years in order to obtain a driver's license, Lovejoy-Wilson is unable to drive a motor vehicle.

Lovejoy-Wilson was told that she could not be considered for promotion to an assistant manager position because she did not drive and driving to a bank to make deposits was an essential duty of an assistant manager. However, she was later offered a promotion to the position of assistant manager at a store at which an armored car service picked up the store's receipts and transported them to the bank for deposit.

Rejecting this assignment because of its undesirable location, Lovejoy-Wilson told NOCO that she felt that she was being discriminated against because of her disability in violation of the ADA and suggested six possible accommodations of her disability that would, in her view, be reasonable. In her words, any one of the following would provide a reasonable accommodation of her disability:

1. Another manager can pick her up on the way to the bank.

2. She could hire a service to drive her when necessary for her job.

3. NOCO could hire a service to drive disabled employees in management and supervisory positions when necessary.

4. She could hire an individual to drive her when necessary for the job.

5. NOCO could hire an individual to drive disabled management and supervisory employees when necessary.

6. Where practical and possible, she could use public transportation when travel is necessary for her job.

NOCO's president, Robert Newman, rejected all of these suggestions. He wrote Lovejoy-Wilson: The ADA is not for intimidating employers to change non-discriminatory operational policies. Given our past record of accommodating employees with disabilities, I find your position weak at best.

When a promotion failed to materialize Lovejoy-Wilson submitted her resignation effective September 15, 1994 and commenced working for another employer the next day. She also filed a complaint with EEOC alleging that NOCO had discriminated against her because of her disability.

Eventually Lovejoy-Wilson obtained a “right-to-sue letter” and brought an action in federal district court against NOCO for unlawful discrimination. The district court granted NOCO's motion for summary judgment, concluding that while Lovejoy-Wilson was a qualified individual with a disability, she had not been constructively discharged.

Both Lovejoy-Wilson and NOCO appealed the district court's judgment. Lovejoy-Wilson challenged the district court's dismissal of her accommodation, promotion, and retaliation claims while NOCO contested the district court's determination that Lovejoy-Wilson is a qualified individual with a disability under the ADA.

The Second Circuit said that the ADA provides that “[n]o covered entity shall discriminate against a qualified individual with a disability because of the disability of such individual in regard to job application procedures, the hiring, advancement, or discharge of employees, employee compensation, job training, and other terms, conditions, and privileges of employment.”

Further, said the court, under ADA, the term “discriminate” includes “not making reasonable accommodations to the known physical or mental limitations of an otherwise qualified individual with a disability who is an applicant or employee....”

The district court's dismissal of Lovejoy-Wilson's complaint, said the Circuit Court of Appeals, was based on its conclusion that Lovejoy-Wilson's desire to become an assistant manager at a particular location was based on personal convenience, not her disability, and that NOCO accommodated her disability by promoting her to assistant manager at a store with armored car service in May 1994.

The court held that in so doing, the district court misinterpreted and misapplied the requirements underlying providing a reasonable accommodation under the ADA and failed to consider the facts in the light most favorable to Lovejoy-Wilson.

Rejecting NOCO's argument that by offering Lovejoy-Wilson a promotion at an armored car store was, as a matter of law, a reasonable accommodation, the Second Circuit cited its ruling in Wernick v Federal Reserve Bank, 91 F.3d 379. In Wernick the court said that in requiring reasonable accommodation, “Congress intended simply that disabled persons have the same opportunities available to them as are available to nondisabled persons.”

As to a disabled individual requesting placement at a particular location, the court commented that: If an employer offers its workforce an opportunity for promotion to a higher level of employment without honoring any requests for a particular location (or shift), then an ADA plaintiff cannot complain of assignment to a less favorable location. However, if the employer permits its workers to apply for promotion at a preferred location (or shift), then a disabled person must have the same opportunity.

The decision states that “the evidence thus far developed in this case indicates that NOCO's employees could apply for promotion at a particular store.” Accordingly, if its employees could apply for promotion to assistant manager at stores of their choice, then Lovejoy-Wilson had the right to seek the assistant manager job at the store she desired free from discrimination.

The Circuit Court concluded that in making the determination whether or not NOCO failed to accommodate Lovejoy-Wilson's disability, the reason for her desire for that particular job -- personal convenience or otherwise -- does not matter. Lovejoy-Wilson was entitled to a reasonable accommodation, if one was available, to permit her to compete with nondisabled applicants on an equal basis to become assistant manager at the store of her choice.

A rational jury could find on the basis of the evidence adduced that such a reasonable accommodation was available but not offered to her.

Finally, said the court, there is more than enough evidence to support a jury finding that “NOCO flatly refused to afford the plaintiff the reasonable accommodation to which she was entitled.” After sustaining portions of the lower court's decision, the matter was remanded for further action in the district court.

Union activity not a shield for an employee the appointing authority decides not to retain for bona fide reasons

Union activity not a shield for an employee the appointing authority decides not to retain for bona fide reasons

Kunjbehari v. Wyandanch Union Free School District, Supreme Court, Justice Costello, Appeal to 2nd Department withdrawn (Index No. 26164/00)

Kunjbehari challenged the District's decision to deny him tenure and sought a court order directing his reinstatement as District Administrator, retroactive to July 1, 2000, together with all back pay and other benefits.

Kunjbehari held tenure with the Wyandanch as an Attendance Teacher. In July 1996, he was appointed to the position of Assistant Director of Student Services, a new position in which he was required to serve a three-year probationary period. In July 1997, Kunjbehari was appointed Director of Testing, Evaluation and Attendance. In April 1999, the then Superintendent of School, Dr. James Lotheridge, recommended that Kunjbehari be granted tenure. The Board of Education rejected that recommendation, but approved Kunjbehari's request that he be permitted to serve another year of probation. The extended probationary period was for the period of July 1, 1999 to June 30, 2000.

In March 2000, Kunjbehari was told by Dr. Brian DeSorbe, the Acting Superintendent, that he was recommending that the Board of Education not grant him tenure. Dr. DeSorbe provided Kunjbehari a written statement setting out the fifteen reasons which formed the basis for Dr. DeSorbe's recommendation he be denied tenure. Kunjbehari submitted a written response to Dr. DeSorbe's statement that was forwarded to the Board of Education. The Board denied Kunjbehari tenure.

Kunjbehari sued, contending that the Superintendent's decision not to recommend him for tenure “was arbitrary and capricious and in bad faith motivated by Dr. DeSorbe's desire to retaliate against petitioner for his union activity.” He alleged that “underlying Dr. DeSorbe's decision to deny [him] tenure was the fact that [he] served as the President of the Wyandanch Administrators' Association and, in that capacity, that he filed and pursued grievances on behalf of himself and three other district administrators against the School District during the 1998-1999 school year arising out the School District's denial of merit pay increases to these administrators.

The court said that while “a board of education has an unfettered right to terminate the employment of a teacher or administrator during his or her probationary period, without a hearing,” it may not do so for “a constitutionally impermissible purpose or in violation of a statutory proscription.” Further, Justice Costello said that “[a]s broad as the board's discretion may be, however, it is also the rule that a school board may not deny tenure to retaliate for a teacher's or administrator's exercise of his or her constitutional rights of free speech and association.”*

In addition, Justice Costello commented that “it is the clear public policy of this State, as set forth in the Taylor Law (Article 14 of the Civil Service Law), that a school board may not discriminate against teachers or administrators for exercising their right to belong to or participate in an employees' union.” However, an individuals' union activity will not provide a shelter for a teacher or administrator whom the school district decides not to retain for bona fide reasons.

* Justice Costello also commented that “[i]t is uncontroverted that the Board of Education lacks the authority to reject the Superintendent's recommendation that tenure be denied, citing Anderson v. Board of Education, 46 AD2d 360, affirmed 38 NY2d 897.”