Opinion
Case No. 01-2373-JWL
July 23, 2002
MEMORANDUM ORDER
Plaintiff, appearing pro se, filed suit against defendant alleging that defendant terminated her employment on the basis of her race in violation of Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e et seq. Defendant moves for summary judgment (doc. #78) on the grounds that plaintiff was an independent contractor and not an "employee" for purposes of Title VII coverage. For the reasons set forth more fully below, the court grants defendant's motion and dismisses plaintiff's complaint in its entirety.
Also pending before the court is defendant's motion to strike (doc. #87) plaintiff's "supplement" to her response to defendant's motion for summary judgment, a supplement that was filed after defendant filed its reply brief and, thus, is in the nature of a surreply. The motion to strike is denied because the court, even considering the substance of plaintiff's surreply (in which plaintiff primarily attempts to distinguish the cases cited by defendant in its papers from the facts of this case and attempts to authenticate the documents submitted by plaintiff with her response to defendant's motion for summary judgment), the court nonetheless concludes that summary judgment in favor of defendant is appropriate.
I. Facts
The following facts are either uncontroverted or related in the light most favorable to plaintiff, the nonmoving party. Defendant is engaged in the business of government, health, business, and insurance information services. Plaintiff's working relationship with defendant began on June 12, 1997 when the parties entered into two contracts. Pursuant to those contracts, plaintiff agreed to perform research services for defendant such as collecting information from court and governmental agency records and databases and performing property and title searches. The parties agreed that plaintiff would not be paid a salary (and, in fact, plaintiff never was paid a salary) but that plaintiff would be paid by the job or "unit," which refers to a search of a particular database. The contracts also expressly provided that plaintiff would not be considered an agent or employee of defendant; rather, she would be considered an independent contractor. The contracts further provided that defendant was only interested in the results of plaintiff's work and that defendant would not control the manner in which plaintiff performed the services for which defendant contracted. Finally, plaintiff was permitted under the contracts to contract for similar services with other companies. It is uncontroverted that plaintiff understood at the time of contracting that she was an independent contractor and not an employee of defendant.
Over the course of the next two and one-half years, plaintiff performed research services for defendant. During that same time period, plaintiff performed similar services for a number of other companies. In fact, plaintiff testified that during this time she considered herself "self-employed" and that she was running her own business. Consistent with her understanding of the nature of her relationship with defendant, plaintiff identified herself as an independent contractor when she sent letters, reports or other correspondence to defendant. Similarly, plaintiff submitted invoices to defendant for "independent contractor services."
On plaintiff's federal income tax returns for 1997, 1998 and 1999, plaintiff indicated that she was an independent contractor with respect to the services she performed for defendant and she listed the income she earned from defendant under "business income" as opposed to wages. She further indicated that she was self-employed and she reflected her income from defendant on Schedule C relating to profit or loss from a business. In addition, plaintiff claimed as deductions her business expenses incurred in connection with the services she performed for defendant.
During the time plaintiff performed services for defendant, defendant did not require plaintiff to work from defendant's offices and plaintiff, in fact, did not work from any of defendant's offices. Rather, plaintiff performed most of her services for defendant from her private residence. Defendant did not require plaintiff to attend any training meetings and plaintiff did not receive any formal training from defendant. Defendant did not require plaintiff to work at any particular time during the day and did not dictate when plaintiff was to begin and/or end her work day. Defendant did not establish any set number of hours that plaintiff was required to work during the day, week or month and, in fact, plaintiff was free to decline any and all assignments offered by defendant. In other words, plaintiff set her own work schedule regarding when and whether she desired to work on particular jobs or projects. Moreover, defendant did not supply plaintiff with any computers, equipment or tools for the performance of her work; she furnished, at her own expense, all necessary supplies, material and equipment to carry out the services she performed for defendant. Plaintiff also had the right to hire employees or assistants to help her with the research services she performed for defendant. Finally, plaintiff was not eligible for and did not receive retirement benefits, health benefits or annual leave from defendant and defendant did not pay social security taxes for plaintiff.
Plaintiff performed services for defendant until November 4, 1999 when defendant terminated its contracts with plaintiff upon fifteen days notice as required therein.
II. Summary Judgment Standard
Summary judgment is appropriate if the moving party demonstrates that there is "no genuine issue as to any material fact" and that it is "entitled to a judgment as a matter of law." Fed.R.Civ.P. 56(c). In applying this standard, the court views the evidence and all reasonable inferences therefrom in the light most favorable to the nonmoving party. Spaulding v. United Transp. Union, 279 F.3d 901, 904 (10th Cir. 2002). A fact is "material" if, under the applicable substantive law, it is "essential to the proper disposition of the claim." Wright ex rel. Trust Co. of Kansas v. Abbott Laboratories, Inc., 259 F.3d 1226, 1231-32 (10th Cir. 2001) (citing Adler v. Wal-Mart Stores, Inc., 144 F.3d 664, 670 (10th Cir. 1998)). An issue of fact is "genuine" if "there is sufficient evidence on each side so that a rational trier of fact could resolve the issue either way." Adler, 144 F.3d at 670 (citing Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986)).
The moving party bears the initial burden of demonstrating an absence of a genuine issue of material fact and entitlement to judgment as a matter of law. Spaulding, 279 F.3d at 904 (citing Celotex Corp. v. Catrett, 477 U.S. 317, 322-23 (1986)). In attempting to meet that standard, a movant that does not bear the ultimate burden of persuasion at trial need not negate the other party's claim; rather, the movant need simply point out to the court a lack of evidence for the other party on an essential element of that party's claim. Adams v. American Guarantee Liability Ins. Co., 233 F.3d 1242, 1246 (10th Cir. 2000) (citing Adler, 144 F.3d at 671).
Once the movant has met this initial burden, the burden shifts to the nonmoving party to "set forth specific facts showing that there is a genuine issue for trial." Spaulding, 279 F.3d at 904 (citing Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986)); Anderson, 477 U.S. at 256; Celotex, 477 U.S. at 324. The nonmoving party may not simply rest upon its pleadings to satisfy its burden. Anderson, 477 U.S. at 256; accord Eck v. Parke, Davis Co., 256 F.3d 1013, 1017 (10th Cir. 2001). Rather, the nonmoving party must "set forth specific facts that would be admissible in evidence in the event of trial from which a rational trier of fact could find for the nonmovant." Mitchell v. City of Moore, Oklahoma, 218 F.3d 1190, 1197-98 (10th Cir. 2000) (quoting Adler, 144 F.3d at 671). To accomplish this, the facts "must be identified by reference to an affidavit, a deposition transcript, or a specific exhibits incorporated therein." Adams, 233 F.3d at 1246.
Finally, the court notes that summary judgment is not a "disfavored procedural shortcut;" rather, it is an important procedure "designed to secure the just, speedy and inexpensive determination of every action." Celotex, 477 U.S. at 327 (quoting Fed.R.Civ.P. 1).
III. Discussion
Plaintiff claims that defendant discriminated against her on the basis of her race in violation of Title VII. In support of its motion for summary judgment, defendant contends that plaintiff was an independent contractor and, thus, not an "employee" as that term is defined in Title VII. As set forth below, the court agrees that the uncontroverted facts demonstrate that plaintiff was an independent contractor. Thus, she is not entitled to the protections of Title VII and summary judgment in favor of defendant is appropriate.
Title VII provides that it is "an unlawful employment practice for an employer . . . to discharge any individual . . . because of such individual's race. . . ." 42 U.S.C. § 2000e-2(a)(1). An employer is defined as "a person engaged in an industry affecting commerce who has fifteen or more employees." Id. § 2000e(b). An employee, in turn, is defined as "an individual employed by an employer." Id. § 2000e(f). In order to establish a prima facie case under Title VII, then, plaintiff is required to prove, among other things, that defendant was her employer. Lockard v. Pizza Hut, Inc., 162 F.3d 1062, 1069 (10th Cir. 1998).
A "person" is further defined to include partnerships, associations and corporations. Id. § 2000e(a).
Courts attempting to distinguish between employees and independent contractors for the purposes of federal anti-discrimination statutes have applied a variety of tests-the common law agency inquiry; the "hybrid" common law-economic realities method; and the single employer or true economic realities test. Lockard v. Pizza Hut, Inc., 162 F.3d 1062, 1069 (10th Cir. 1998). The Tenth Circuit has endorsed the use of the hybrid approach for purposes of determining whether a plaintiff is an employee of a particular entity for Title VII purposes. See Lambertsen v. Utah Dep't of Corrections, 79 F.3d 1024, 1028 (10th Cir. 1996). Although this approach considers the economic realities of the working relationship, "the focus of the inquiry is the employer's right to control the 'means and manner' of the worker's performance." Oestman v. National Farmers Union Ins. Co., 958 F.2d 303, 305 (10th Cir. 1992) (applying hybrid test to determine whether insurance agent was an "employee" for purposes of ADEA) (quoting Spirides v. Reinhardt, 613 F.2d 826, 831 (D.C. Cir. 1979)). Other factors to consider when applying the hybrid test include the following:
(1) the kind of occupation, with reference to whether the work usually is done under the direction of a supervisor or is done by a specialist without supervision; (2) the skill required in the particular occupation; (3) whether the "employer" or the individual in question furnishes the equipment used and the place of work; (4) the length of time during which the individual has worked; (5) the method of payment, whether by time or by the job; (6) the manner in which the work relationship is terminated; i.e., by one or both parties, with or without notice and explanation; (7) whether annual leave is afforded; (8) whether the work is an integral part of the business of the "employer"; (9) whether the worker accumulates retirement benefits; (10) whether the "employer" pays social security taxes; and (11) the intention of the parties.Id. (quoting Spirides, 613 F.2d at 832); accord Lambertsen, 79 F.3d at 1028. No single factor is conclusive. Lambertsen, 79 F.3d at 1028 (citing Oestman, 958 F.2d at 305). Rather, the court must consider the totality of the circumstances surrounding the working relationship between the parties. Id. (citing Oestman, 958 F.2d at 305).
The uncontroverted facts here, taken as a whole, demonstrate that plaintiff was an independent contractor and not an employee. As set forth above, the focus of the hybrid test is the employer's right to control the "means and manner" of the worker's performance. Here, plaintiff's work day was completely unsupervised. Defendant did not require plaintiff to work particular hours or, for that matter, to work at all. Defendant did not require plaintiff to work in its offices and plaintiff, in fact, worked from her home. In addition, plaintiff furnished all necessary equipment for her work and had the right to hire employees or assistants to help her with the research services she performed for defendant. These undisputed facts severely undermine plaintiff's claim. See Lambertsen, 79 F.3d at 1028 (affirming district court's determination on summary judgment that plaintiff was not an employee where there was no evidence that the defendant controlled the means or manner in which plaintiff performed her day-to-day work); Oestman, 958 F.2d at 306 (fact that appellant's performance was "subject to virtually no restrictions" supported finding on summary judgment that he was an independent contractor and not an employee under ADEA; appellant set his own working hours, maintained his own offices, could hire his own staff and was generally free to work as he chose).
Other aspects of the working relationship between the parties also lead to the conclusion that plaintiff was an independent contractor rather than an employee. Plaintiff was paid by the job; she was not afforded annual leave; she did not accumulate retirement benefits; and defendant did not pay social security taxes for her. These facts are all relevant and significant considerations when applying the hybrid test. See Oestman, 958 F.2d at 306 (fact that appellees did not withhold taxes from appellant's pay and did not pay social security taxes for him supported finding that appellant was an independent contractor). It is also significant that plaintiff filed her taxes as a self-employed individual. See id. (fact that appellant filed his taxes as a self-employed individual supported finding that appellant was an independent contractor). Moreover, the parties expressly agreed that plaintiff would be an independent contractor. See id. (fact that agency agreement expressly stated that appellant was an independent contractor supporting finding that appellant was an independent contractor).
In fact, plaintiff concedes that she believed herself to be an independent contractor and that she fully intended to be an independent contractor rather than an employee of defendant. Nonetheless, plaintiff contends that defendant, through its conduct, "unilaterally converted" plaintiff's status from independent contractor to employee. In support of her argument, plaintiff contends that defendant provided plaintiff with assignments that were beyond the scope of the assignments described in her contract. For example, plaintiff alleges that her very first assignment was to do research in the federal court system, at $4.00 per unit, despite the fact that her contract expressly stated that she would be assigned to do public record searches only at the state and county level, at $3.00 per unit. Such evidence, however, does not tend to indicate that plaintiff was an employee rather than an independent contractor. In fact, because it shows that plaintiff was paid "per unit," it further supports the conclusion that she was an independent contractor. Thus, no reasonable jury could conclude, based on this evidence, that plaintiff was an employee of defendant.
Plaintiff also contends that defendant "converted" her to employee status by providing "training materials" with her initial contract. These materials, however, are simply instructions that describe the type of information that defendant wanted plaintiff (and all other independent contractors) to find in her various searches. Specifically, the instructions state as follows:
Attached are forms that correspond to the different kinds of searches done by [defendant]. When you do a search, take the corresponding form to the courthouse with you and research the information. This will guarantee the correct material requested by our customer.
In the absence of any evidence that plaintiff received any individual instruction or on-the-job training with respect to the services she contracted to perform, no reasonable jury could conclude that the minimal written instructions provided to plaintiff constituted "training" sufficient to confer employee status on plaintiff. See Hanson v. Friends of Minnesota Sinfonia, 181 F. Supp.2d 1003, 1008 (D.Minn. 2002) (concluding on summary judgment that plaintiff was an independent contractor where, among other things, plaintiff did not receive on-the-job training and did not receive any individual instruction); Staudinger v. Hoelscher, Inc., 166 F. Supp.2d 1335, 1341-42 (D.Kan. 2001) (finding on summary judgment that sales representatives were independent contractors rather than employees despite fact that representatives were given a sales brochure and rudimentary training for product knowledge; defendant did not provide materials instructing representatives on the manner or method of selling or promoting product); Clifton v. Mars Telecom, Inc., No. 95-2364-JWL, 1996 WL 157288, at *4 (D.Kan. Mar. 5, 1996) (sales representatives were independent contractors rather than employees where, among other things, defendant did not provide any special training, but only showed representatives how to properly fill out forms relevant to service performed).
Finally, plaintiff suggests that defendant changed plaintiff's status from independent contractor to employee by preparing invoices concerning plaintiff's work when the contract expressly provided that plaintiff would provide her own invoices and by reimbursing plaintiff for her travel and out-of-pocket expenses when the contract expressly provided that plaintiff was responsible for travel and expenses. This evidence, however, simply does not bear on defendant's right to control the manner and means of plaintiff's work performance, nor does it bear on any of the other factors relevant to the application of the hybrid test. In short, then, the mere fact that defendant prepared invoices for plaintiff's work and paid for plaintiff's travel and out-of-pocket expenses is insufficient to permit a reasonable jury to conclude that plaintiff was an employee of defendant.
In sum, based on the totality of the circumstances surrounding the working relationship between plaintiff and defendant, the court concludes that plaintiff, as a matter of law, was an independent contractor. Accordingly, the court grants defendant's motion for summary judgment.
IT IS THEREFORE ORDERED BY THE COURT THAT defendant's motion for summary judgment (doc. #78) is granted and defendant's motion to strike plaintiff's supplement to her response to defendant's motion for summary judgment (doc. #87) is denied. Plaintiff's complaint is dismissed in its entirety.