Sixth Circuit Adopts ‘Joint Employer' Theory In EEOC Race Case Against Prime Contractor

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By Patrick Dorrian  

Dec. 11 --The Equal Employment Opportunity Commission can pursue claims that the general contractor on a hospital construction site in Memphis, Tenn., is liable for racial harassment and retaliation against a group of black workers hired by a subcontractor, the U.S. Court of Appeals for the Sixth Circuit held Dec. 10 (EEOC v. Skanska USA Bldg., Inc., 2013 BL 341867, 6th Cir., No. 12-5967, unpublished opinion 12/10/13).

Reversing a lower court's ruling against the EEOC, the appeals court found evidence that Skanska USA Building Inc. may have been the “joint employer” of Maurice Knox and several other black men who were hired by C-1 Inc. to operate a temporary elevator at the construction site.

The appeals court also revived the separate Title VII of the 1964 Civil Rights Act and Civil Rights Act of 1866 (42 U.S.C. § 1981) claims of Knox, who intervened in the EEOC's case.

Judge Raymond M. Kethledge said the harassment allegedly experienced by the black workers, who were employed as buck hoist operators, included Knox and others being called egregious racial slurs as well as racist graffiti in portable toilets at the jobsite. Someone also threw liquid from a porta-potty onto Knox's arms and into his eyes, causing them to swell. Despite the workers' complaints to C-1's owner, Skanska managers and others, nothing was ever done to stop the harassment, according to the EEOC.

The EEOC ultimately sued Skanska on behalf of Knox and other buck hoist operators who were black, alleging that the company subjected them to a hostile work environment based on race and retaliation in violation of Title VII. Knox intervened in the case asserting claims of his own under Title VII and Section 1981.

The U.S. District Court for the Western District of Tennessee ruled for the general contractor. However, based on the evidence of Skanska's possible joint employer status, the Sixth Circuit reversed and remanded for further proceedings.

The appeals court said it hadn't previously applied the joint employer theory in a Title VII case, although it had assumed “in dicta” that an employer can be liable under Title VII pursuant to the theory. It said the Third, Ninth and Eleventh circuits have all “applied the test to determine whether an entity is liable under Title VII.”

According to the theory, entities are considered to be joint employers when they “share or co-determine” the essential terms and conditions of a worker's employment, Kethledge said. “To determine whether an entity is the plaintiff's joint employer, we look to an entity's ability to hire, fire or discipline employees, affect their compensation and benefits, and direct and supervise their performance,” he wrote.

Deciding to adopt the joint employer test, the Sixth Circuit said there was sufficient evidence to support a finding that Skanska jointly employed Knox and the other black operators. It found that “Skanska supervised and controlled the operators' day-to-day activities without any oversight from [C-1 owner Gerald] Neely.”

 

To contact the reporter on this story: Patrick Dorrian in Washington at pdorrian@bna.com

To contact the editor responsible for this story: Susan J. McGolrick at smcgolrick@bna.com


Text of the opinion is available at http://www.bloomberglaw.com/public/document/EEOC_v_Skanska_USA_Building_Inc_Docket_No_1205967_6th_Cir_Aug_17_.