Can Temporary Employees Make an Employer Subject to the ADEA? You Might Be Surprised

Rodriguez v. Dynamesh, Inc. - U.S. District Court for the Northern District of Illinois Eastern Division

Facts:  Martha Rodriguez ("Rodriguez") was hired by a screen printing supply business, Dynamesh, in 2006.  During 2013 and 2014, Dynamesh had 15 - 16 regular employees and had a staffing agency supply 8 temporary workers as well.  She alleged that in 2014, Dynamesh treated her differently than non-Hispanic, younger co-workers in regard to promotions, terms and conditions of employment, and discipline.  Shortly thereafter, Dynamesh terminated Rodriguez.  

Rodriguez subsequently brought suit against Dynamesh and alleged age discrimination in violation of the Age Discrimination in Employment Act of 1967 ("ADEA").  Dynamesh moved for summary judgment on Rodriguez's claim on the grounds that it was not an "employer" under the ADEA as it had less than 20 employees during 2013 and 2014; therefore Rodriguez could not bring a valid ADEA claim.

Holding:  The District Court denied Dynamesh's motion for summary judgment on the grounds that Dynamesh could be considered an "employer" under the ADEA and therefore Rodriguez's ADEA claim could proceed.  The Court noted that while the ADEA only applies to "employers" who employ 20 or more employees for each working day in 20 or more calendar weeks, including the temporary workers at Dynamesh could satisfy the minimum threshold under the ADEA. 

In this instance, the Court looked at the employment relationship between Dynamesh and the temporary employees and held that the traditional principles of agency law apply.  Of note, the Court utilized a five factor test to determine whether the temporary workers qualified as employees:

1. The extent of the employer's control and supervision over the worker, including directions on scheduling and performance of work;
2. The kind of occupation and nature of skill required, including whether skills are obtained in the workplace;
3. Responsibility for the costs of operation, such as equipment, supplies, fees, licenses, workplace, and maintenance of operations;
4. Method and form of payment and benefits; and
5. Length of job commitment and/or expectations.

The Court subsequently established that these temporary workers could be considered employees because Dynamesh controlled the temporary workers' schedules, work tasks, supervision, and work location.  As for Dynamesh's argument that labeling the temporary workers as employees would improperly create joint employer liability, the Court pointed to other courts that had previously held that a joint employer liability theory is cognizable under the ADEA.

Judgment:  The District Court denied Dynamesh's motion for summary judgment on the grounds that the temporary employees that worked at Dynamesh could be counted towards the 20 employee threshold required to designate Dynamesh as an "employer" under the ADEA. 

The Takeaway:  Employers take note:  Just because you have temporary workers does not necessarily mean you can wash your hands of being liable under laws such as the ADEA.  As the Court pointed out, having 15 actual employees then staffing the rest of the company with temporary workers from a staffing agency does not allow an employer to avoid liability under the ADEA.  It is important to remember that courts will often look at whether a temporary worker is actually an employee (by way of a five factor test, as the Court did in this case).  Tread carefully the next time you think you can avoid liability under laws such as the ADEA because you staff some of your work force with temporary workers.

Majority Opinion Judge:  Judge Gettleman

Date:  February 24, 2015

Opinion:  hr.cch.com/ELD/RodriguezDynamesh.pdf