EEOC-Initiated Litigation - 2022 Edition

36 | EEOC-Initiated Litigation: 2022 Edition © 2022 Seyfarth Shaw LLP 4. Complex Employment Relationships The EEOC’s most recent SEP added a new issue under the Emerging and Developing Issues priority: focusing on complex employment relationships and structures in the 21st century workplace, specifically with respect to temporary workers, staffing agencies, independent contractor relationships, and the on- demand economy . 266 Often these issues depend on whether one or more entities can be considered the “employer” of an employee . 267 According to the EEOC’s Compliance Manual, employers that are unrelated (or not sufficiently related to qualify as an “integrated enterprise”) are “joint employers” of a single employee if each employer exercises sufficient control of an individual to qualify as his/her employer. Notably, the EEOC’s definition is different than the statutory definitions that apply to some of the anti- discrimination laws that the EEOC enforces. Although the EEOC added the complex employment relationship priority to its SEP in 2017, there had been few significant case law developments in this area until recently. FY 2020 saw a significant increase in decisions regarding this issue, and that trend has continued into FY 2021. The sheer number of these cases compared to prior years, along with the fact that they were decided at the early motion to dismiss stage, may indicate a developing trend toward increased enforcement in this area. For example, in EEOC v. CACI Secured Transformations, LLC , 268 the U.S. District Court for the District of Maryland held that a client company of a staffing company could be held liable to the staffing company’s employee. In that case, the charging party was directly employed by a staffing agency and was assigned to work for the prime contractors of an NSA engineering-services contract. The charging party was interviewed by the contractor and hired by the staffing agency under a contract that was conditioned on her selection by the contractor to work with the contractor on the NSA contract. She was then involved in a car accident that impacted her ability to work and commute to work. The contractor eventually informed the staffing agency that they wanted the charging party removed from the contract because she did not meet performance requirements. Although the staffing company attempted to find different work for her, she was not able to meet the experience or performance requirements for those positions. The EEOC sued the contractor, alleging disability discrimination. 269 The contractor moved for summary judgment, arguing that it was not the charging party’s employer. The court acknowledged at the outset of its analysis that “[t]his dispute brings to the fore ‘the reality of changes in modern employment, in which increasing number of workers are employed by temporary staffing companies.’” 270 Under the ADA, decisions about who counts as an employer are decided under the “joint employer doctrine,” under which an employment relationship will be found if an entity exercised sufficient control over the terms and conditions of a worker’s employment. 271 The court analyzed this issue using the nine-factor test used by the Fourth Circuit. Under that test, the court found that the contractor had significant control over charging party’s hiring by the staffing agency since it was conditioned upon her selection by the contractor. It also found that it had effective control over firing her since she was effectively fired when she was removed from the contract by the contractor . 272 Although the staffing agency attempted to find her other positions, she was technically formally fired at the time that she was let go by the contractor: “[Charging Party] was fired from [staffing company] immediately upon her removal from the MWIII project, with the possibility that she would be rehired if she was later placed on a different contract. ” 273 266 See U.S. Equal Employment Opportunity Commission Strategic Enforcement Plan FY 2017 - 2021, available at https://www.eeoc.gov/eeoc/plan/sep-2017.cfm. 267 Id .; See EEOC Compliance Manual, Section 2: Threshold Issues § 2-III(B)(1)(A)(iii)(b), available at https://www.eeoc.gov/policy/docs/threshold.html. 268 EEOC v. CACI Secured Transformations, LLC , No. 19-CV-2693, 2021 WL 1840807 (D. Md. May 7, 2021). 269 Id. at *5. 270 Id. at * 6 (quoting Butler v. Drive Auto. Indus. of Am., Inc. , 793 F.3d 404, 410 (4th Cir. 2015)). 271 Id. 272 Id. at *7. 273 Id.