Legal Memorandum: Employer's Liability to a Non-employee

Issue: Can a defendant be liable to a non-employee for sex discrimination based on a hostile work environment in Iowa?

42 U.S.C. § 2000-e(f) (“The term ’employee’ means an individual employed by an employer . . . .”  Note that the statutory definition itself requires an employer-employee relationship.).

Moland v. Bil-Mar Foods, 994 F. Supp. 1061 (N.D. Iowa 1998) (“[I]n order to prevail on her Title VII claim, Moland must demonstrate that defendants were her ’employer.'”  In this case, plaintiff who was employed by IBP but worked at a location owned by Bil-Mar Foods was found not to have a direct employment relationship with Bil-Mar Foods.  However, the court found a question of fact as to whether Bil-Mar was plaintiff’s “indirect” employer because of its control over plaintiff’s employment opportunities.).

Graves v. Women’s Prof’l Rodeo Ass’n, Inc., 907 F.2d 71 (8th Cir. 1990) (“Central to the meaning of these words is the idea of compensation in exchange for services: an employer is someone who pays, directly or indirectly, wages or a salary or other compensation to the person who provides services — that person being the employee.  Compensation by the putative employer to the putative employee in exchange for his services is not a sufficient condition, but it is an essential condition to the existence of an employer-employee relationship.”)

York v. Association of the Bar of the City of N.Y., 286 F.3d 122 (2d Cir. 2002) (individual who receives no “financial benefit” from the defendant, such as salary, wages, vacation pay, and benefits, is not an employee of the defendant for Title VII purposes).