OK, so we engaged in a little Page 6 headline hyperbole – the Nuns were not literally “tossed out” of the court, but just had their discrimination claims dismissed. But the case is important, and we wanted to catch your eye.
A major issue for employers these days is whether individuals are employees or independent contractors. There are serious employment and tax consequences inherent in this distinction. In that regard, we commend for your edification a new federal appeals court decision which dissected this issue and discussed it at length in the course of an interesting case involving two altruistic Catholic Nuns.
In that case, the two Catholic Nuns were disaster relief volunteers for the American Red Cross and the [Ohio] Ross County Emergency Management Agency for extended periods of time. As the Court noted, they “dedicated their lives to assisting the poor and serving the good of the community.”
After some issues with management at both places, they filed a Title VII case (and also claims under Ohio law), claiming religious discrimination, retaliation, and harassment, as well as Section 1983 violations of their constitutional rights to free speech, free exercise of religion, and equal protection under the law.
The issue framed by the Court was: “Under what circumstances are volunteers protected from employment discrimination by Title VII? … The parties agree that the critical issue is whether the Sisters were ‘employees’ of the Red Cross or RCEMA.”
In summarizing the relevant facts (followed by a long discussion), the Court held that the Nuns “have not shown that they received compensation, obtained substantial benefits, completed employment-related tax documentation, were restricted in their schedule or activities, or were generally under the control of either organization through any of the other incidents of an agency relationship. … Therefore, their volunteer relationship does not fairly approximate employment and is not covered by Title VII. Nor, as will be explained, were the Sisters’ constitutional rights violated.”
The Court goes through all of the relevant factors which distinguish employees from independent contractors, as well as discussing the status of “volunteer.”
Worth a read.