9th Circuit Announces Test for Joint Employment under Title VII

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By now, most everyone knows that under many employment laws, there can be more than one “employer,” and more than one party liable as an “employer” for violation of those laws. Until recently, however, there was no definitive test in Ninth Circuit for when parties would be considered “joint employers” for purposes of Title VII.

On February 6, 2019, the Court concluded that the common-law agency test should be applied in the Title VII context and explained that, “Under the common-law test, ‘the principal guidepost’ is the element of control—that is, ‘the extent of control that one may exercise over the details of the work of the other.’”  The Court provided a non-exhaustive list of factors to consider when analyzing whether the requisite control exists, which includes:

  • the skill required
  • the source of the instrumentalities and tools
  • the location of the work
  • the duration of the relationship between the parties
  • whether the hiring party has the right to assign additional projects to the hired party
  • the extent of the hired party’s discretion over when and how long to work
  • the method of payment
  • the hired party’s role in hiring and paying assistants
  • whether the work is part of the regular business of the hiring party
  • whether the hiring party is in business
  • the provision of employee benefits
  • the tax treatment of the hired party

The Court expressly rejected the chief alternative for analyzing employment relationships in the Title VII context: the economic-reality test, which focuses on whether workers are economically dependent on the alleged joint employer.

While this clarification is helpful because it defines the test to be applied (and argued) under Title VII in the Ninth Circuit, the Court also acknowledged that “there may be little functional difference between the common-law agency test and the economic-reality test” (and a third test sometimes used called the “hybrid” test) and that all three tests are fact intensive and will usually produce the same outcome in a joint-employment analysis.

The opinion is here: Global Horizon Opinion

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