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FEDERAL COURT ISSUES NEW RULING REGARDING APPLICABILITY OF TITLE VII TO EMPLOYERS WITH VOLUNTEER WORK FORCES

September 21st, 2011

Recently, the Sixth Circuit Court of Appeals addressed the issue of whether an person must receive compensation in order to be considered an “employee” for purposes of meeting the 15-employee threshold for covered employers under Title VII. In Bryson v. Middlefield Volunteer Fire Dep’t, Inc., the plaintiff filed Title VII sexual harassment and retaliation claims against the defendant fire department, claiming that the fire chief subjected her to unwanted sexual advances, requests for sexual favors, and other verbal and physical contact of a sexual nature, including demands for sexual favors in return for pay raises. However, the district court dismissed the plaintiff’s claims, holding that the fire department’s firefighters were not employees during the relevant time period – and therefore could not be counted towards Title VII’s requirement that an employer have 15 employees in order to be subject to Title VII – because the fire department’s firefighters were volunteers.

The plaintiff appealed the district court’s ruling and the Sixth Circuit Court of Appeals reversed, finding that the district court erred in adding a significant-remuneration requirement as an independent antecedent to the common-law agency test. The court held that a putative employment relationship existed between the firefighters and the department because the department exercised sufficient control over the actions of the firefighters and the firefighters were compensated for their services – even if they were not on the department’s payroll – because there was a contractual relationship between the firefighters and department pursuant to which the firefighters provided firefighting services to the department in exchange for benefits from the department, including worker’s compensation coverage, insurance coverage, gift cards, personal use of the department’s facilities and assets, training, and access to an emergency fund. The Sixth Circuit held that the district court erred in limiting its analysis to remuneration without considering any other aspects of the department’s relationship with its firefighters because, although remuneration is a factor to be considered, it must be weighed with all other incidents of the relationship.

Employers who have a volunteer workforce should be aware of this decision and their potential liability under Title VII.

For more information, please contact Fraser Trebilcock or Lansing attorney Nicki Proulx at 517-377-0882 or nproulx@fraserlawfirm.com.

Choices in Collective Bargaining

September 1st, 2011

On June 8, 2011 Governor Snyder signed Public Act 54 of 2011, which amends the Public Employment Relations Act (“PERA”) in four key ways. First, it provides that upon expiration of a collective bargaining agreement (“CBA”), public employers shall pay wages not greater than the rate effective on the date of expiration, until a successor agreement is reached. Second, it provides that upon expiration of a CBA, any increase in the premiums or illustrated rate for insurance benefits shall be borne by the employee, until a successor agreement is reached. Third, it prohibits wage and benefit increases from becoming effective retroactive to the date of expiration of the prior CBA, by either an agreement of the parties or an award of an arbitrator. Fourth, it prevents the parties from agreeing to extend or honor the expired CBA during negotiations for a successor agreement.

More specifically, the amendment prevents an employee from receiving a step increase if his anniversary date occurs in between contracts, even if doing so could otherwise be deemed a past practice of the parties. Any step increase would not be effective until a new agreement is reached. Additionally, it requires the employees to bear the cost of any increase in benefit premiums or illustrative rates, on a straight dollar calculation. This requirement only applies to the increases based on category of coverage and does not apply to increases that result from changes in marital or dependant status. The amendment also authorizes the public employer to make the necessary payroll deductions to pay for the increased costs. Finally, PA 54 was given immediate effect upon signing by the Governor. Therefore, if a CBA was expired on June 8, 2011, the pay and benefit costs of the employer are frozen as of that date.

PA 54 represents a significant change to the landscape of public sector collective bargaining in Michiganby shifting the costs associated with expired CBAs to union members. It is also only one of many recent legislative changes affecting public sector bargaining rights.

For more information on how PA 54 and other legislative changes affect your collective bargaining relationship, please contact Fraser Trebilcock attorney Matthew A. Carmona at 313-965-9023 or mcarmona@fraserlawfirm.com.