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Title VII - Joint Employer Liability for Subcontractor's Employees

December 26, 2013

A general contractor may be considered the joint employer of a subcontractor’s employees, under Title VII, where the contractor exercised sufficient control over those individuals, according to the U.S. Court of Appeals for the 6th Circuit. In EEOC v. Skanska USA Building, Inc., a subcontractor’s employee at the contractor’s worksite was subjected to racial harassment.  The EEOC sued both the subcontractor and contractor on behalf of the employee, and the contractor argued that it was not the employee’s employer.  The Court disagreed, stating that companies can be joint employers if they “share or co-determine those matters governing essential terms and conditions of employment.”  In this case, although the subcontractor was the supposed supervisor of the employee, the contractor actually set the hours and daily assignments for the subcontractor’s employees, assigned its own employees to supervise them, handled their complaints, resolved their disputes with its supervisors, and removed some of them from the worksite without challenge from the subcontractor.  The lesson for management is that a company can be liable for discrimination as an employer to individuals who are assigned to work at its facility, whether through a subcontractor, a temporary staffing agency, or some other third-party, if the company exercises some control over the terms and conditions of those individuals’ employment.