Volunteer or employee? In the context of a federal anti-discrimination or retaliation claim, the answer can mean the difference between legal compliance and risky litigation. A recent decision by the U.S. Court of Appeals for the Sixth Circuit (the federal appellate court over Kentucky, Michigan, Ohio, and Tennessee) provides helpful guidance for employers wrestling with this issue.
In Marie v. American Red Cross, 771 F.3d 344 (Sixth Cir. 2014), two traditional Catholic nuns served as long-time volunteers for two non-profit disaster relief organizations. One of the organizations severed ties with the nuns after they complained about not being promoted to a position with more responsibility, and the other after the nuns complained about their skills not being used well. The nuns sued for religious discrimination, harassment, and retaliation in violation of Title VII of the Civil Rights Act (“Title VII”) and the Ohio Civil Rights Act, which mirrors the federal law.
Under Title VII, employers are prohibited from discriminating against employees—not true volunteers—on the basis of religion, national origin, race, color, and sex. The Sixth Circuit found the definition of “employee” set out in Title VII, however, to be less-than-clear. Therefore, the Court analyzed whether an employment relationship exists using factors adopted by the U.S. Supreme Court in Nationwide Mutual Insurance v. Darden, 503 U.S. 318 (1992).
Applying these “Darden factors”, the SIxth Circuit found that the nuns were volunteers, and thus precluded from suing for a violation of Title VII, because:
- the non-profit organizations remitted no payment to the nuns;
- the organizations did not provide the nuns with traditional benefits such as medical, vision, or dental insurance;
- the benefits the nuns did receive (such as workers’ compensation insurance eligibility) were incidental to their work as volunteers;
- the organizations did not treat the nuns as employees for tax purposes;
- the organizations did not exercise control over the nuns (primarily because they could set their own schedule);
- the nuns were not economically tied to the organizations; and
- the nuns’ work was unlike the consistent duties assigned to full-time employees.
The Court noted that while other circuits have altered the Darden factor test to make remuneration more important than the other factors, the Sixth Circuit has not given that prong special weight in the past. Depending on the context of the work or service, however, some of those factors may be less or more helpful in determining an individual’s employment status.
In light of this new decision, employers who use volunteers in carrying out their day-to-day missions should carefully distinguish between employees and true volunteers. Providing separate handbooks for volunteers and employees, ensuring payroll understands how benefits and compensation are different for these individuals, and training management about the limited requirements and responsibilities of volunteers may insulate your organization from a Title VII claim (or other types of employment claims).
If you have questions about the classification of individuals at your organization, members of SKO’s Labor and Employment Group are available to help you determine their status and minimize the risk of liability.