United States District Court, N.D. Illinois, Eastern Division
July 8, 2004.
LEONARD LOWE, Plaintiff,
WOLIN-LEVIN, INC. and EAST POINT CONDOMINIUM ASSOCIATION, Defendants.
The opinion of the court was delivered by: JAMES ZAGEL, District Judge
MEMORANDUM OPINION AND ORDER
The East Point Condominium Association ("Association"), a
dismissed Co-Defendant in this case,*fn1 employed
Co-Defendant Wolin-Levin, Inc., a property management company, to
manage its building at 6101 N. Sheridan Road. Plaintiff Leonard
Lowe was employed as a janitor for the building from January to
October 2000, when he was fired by on-site manager Henry Small
for insubordination related to his repeated spitting on East
Point property and "gossiping" loudly in and around the building.
Lowe later filed suit against Wolin-Levin and the Association
under the theory that they were his "joint" employers. He claimed
two causes of action based on Title VII of the Civil Rights Act
of 1964, as amended, 42 U.S.C.S. § 2000e, and its remedial
provision, 42 U.S.C.S § 1981a. Count I claims religious
harassment and discrimination; Count II claims retaliation. Under the contract between Wolin-Levin and the Association,
Wolin-Levin was authorized and required to perform a variety of
functions, including collection of assessments, payment of
utilities and expenses, and preparation of paychecks and IRS W-2
forms for East Point employees. The contract conferred
responsibility on Wolin-Levin to hire, supervise, and fire
personnel required to maintain and operate the condominium
building, although the contract determined these personnel would
be treated as Association employees. The Association agreed in
the contract to indemnify Wolin-Levin for any liability or
expense related to claims brought against Wolin-Levin under fair
employment, equal employment, or similar laws. Pursuant to the
contract, Wolin-Levin employee Paula Diamond was appointed as
the Supervisory Property Manager to handle, on behalf of the
Association, financial and budgetary matters, large construction
and renovations contracts, and other issues as they arose. Henry
Small, the building's on-site manager who reported to both
Diamond and the Association Board, supervised and fired Lowe.
Under its contractual responsibility, Wolin-Levin had screened
candidates for Henry Small's position and recommended him to the
Wolin-Levin now moves for summary judgment pursuant to Federal
Rule of Civil Procedure 56. Summary judgment is proper if the
"pleadings, depositions, answers to interrogatories, and
admissions on file, together with the affidavits, if any, show
that there is no genuine issue as to any material fact and that
the moving party is entitled to a judgment as a matter of law."
Fed.R.Civ.P. 56(c); Cox v. Acme Health Servs., 55 F.3d 1304,
1308 (7th Cir. 1995). A genuine issue of material fact exists
when, after allowing for all reasonable inferences drawn in a
light most favorable to Plaintiff Lowe, there is evidence on the
basis of which a reasonable jury could return a verdict in his favor. Anderson v.
Liberty Lobby, Inc., 477 U.S. 242, 248 (1986); Eiland v.
Trinity Hosp., 150 F.3d 747, 749 (7th Cir. 1998). The burden is
on Wolin-Levin to establish that no genuine issue of material
fact exists, see Haefling v. UPS, 169 F.3d 494, 497 (7th Cir.
1999), and if it meets that burden, Lowe must set forth specific
facts demonstrating the existence of a genuine issue, See
Celotex Corp. v. Catrett, 477 U.S. 317, 324 (1986). Motions for
summary judgment in employment discrimination cases should be
approached with added rigor because credibility and intent are
often central issues. Collier v. Budd Co., 66 F.3d 886, 892
(7th Cir. 1995).
Wolin-Levin argues that it is cannot be held liable under Title
VII because it did not have an employment relationship with Lowe.
Lowe, however, argues Wolin-Levin may be liable because it had
sufficient control over the Association's employees as to be
their "joint" employer. See Virgo v. Riviera Beach Assocs.,
30 F.3d 1350, 1360-61 (11th Cir. 1994) (finding that retained
contractual authority and actual exercise of control are both
independently relevant factors in determining joint employer
status). Factors to consider when determining whether a company
is a joint employer are: (1) supervision of employees' day-to-day
activities; (2) authority to hire or fire employees; (3)
promulgation of work rules and conditions of employment; (4)
issuance of work assignments; and (5) issuance of operating
instructions. Teamsters Local Unions Nos. 75 & 200 v. Barry
Trucking, Inc., 176 F.3d 1004, 1008 (7th Cir. 1999) (quoting
DiMucci Constr. Co. v. NLRB, 24 F.3d 949, 952 (7th Cir. 1994)).
Both the "Hybrid Economic Realities" and "Defacto Employer"
tests that Wolin-Levin puts forward in its brief focus primarily
on the structural relationship between the employer and employee.
EEOC v. Ill., 69 F.3d 167, 171 (7th Cir. 1995); Ikpoh v. Cent.
DuPage Hosp., No. 90 C 7146, 1992 U.S. Dist. LEXIS 12610, at *18 (N.D. Ill. Aug. 21,
1992). The element of control is an important part of both tests,
although the hybrid test contains 11 additional factors, which I
do not believe are dispositive here. Where an entity like
Wolin-Levin "essentially controls employment decisions" (even
absent a formal employment relationship) and is extensively
involved with plaintiff's day-to-day employment, then the entity
may be considered the de facto employer for purposes of Title VII
liability. EEOC, 69 F.3d at 171-72; Kerr v. WGN Cont'l Broad.
Co., 229 F. Supp.2d 880, 886 (N.D. Ill. 2002).
In order for me to grant summary judgment to Wolin-Levin under
any of these tests, it must show that there is no genuine issue
of material fact as to whether it controlled, or was extensively
involved with, employment decisions at East Point. See id. As
far as discrimination in hiring or firing is concerned, the "key
powers are, naturally, those of hiring and firing." EEOC, 69
F.3d at 171. It may be true, as Wolin-Levin argues, that its
contract with the Association was "more print than practice" and
did not dictate the relationship between the parties. However,
Lowe points to provisions of the contract and other facts
submitted to the court in depositions that contradict this claim
and suggest that Wolin-Levin's practices might have conformed to
its contractual obligations to "maintain and operate the
Condominium property." Both parties agree that the contract
designated the building's employees as East Point employees and
provided for the Association to indemnify Wolin-Levin for any
liability or expense related to any employment claims brought
against it. However, they also agree it placed on Wolin-Levin the
responsibility for hiring, supervising, and firing these
employees, including janitors such as Leonard Lowe. A reasonable jury could find on the basis of this evidence that
Wolin-Levin was a joint employer wielding sufficient control over
Lowe's employment with the Association to have controlled his
hiring and/or firing. Wolin-Levin did not have to be Lowe's
direct employer to wield such control and bring itself under
potential Title VII liability. See Kerr, 229 F. Supp.2d at 886
(citing Papa v. Katy Indus., 166 F.3d 937, 941 (7th Cir. 1999);
EEOC, 69 F.3d at 171-72). It only had to retain control, if
not exercise it, over Lowe's hiring and firing. See EEOC, 69
F.3d at 171 (suggesting that if defendant were "pulling the
strings in the background" it may reach the point at which it was
the de facto employer); Virgo, 30 F.3d at 1361. Whether
Wolin-Levin retained or exercised such control is under factual
dispute because the agreement expressly grants that control to
Wolin-Levin. There are also genuine issues of material fact
regarding the extent to which Paula Diamond was involved in
directly managing Small and the day to day operations at East
Point, the extent Diamond had control over Small's employment,
and the role Diamond and Wolin-Levin played or could have played
in hiring and firing Lowe. Therefore, I find that summary
judgment is inappropriate .
For the reasons stated above, Wolin-Levin's Motion for Summary
Judgment is DENIED.