Opinion ID: 761510
Heading Depth: 1
Heading Rank: 3

Heading: whether the community redevelopment agency and the city

Text: 33 SHOULD BE COUNTED TOGETHER AS AN EMPLOYER UNDER TITLE VII
34 We turn now to the question whether the Community Redevelopment Agency (the CRA) and the City should be aggregated and considered as a single employer under Title VII's definition of that term. Title VII defines employer as a person engaged in an industry affecting commerce who has fifteen or more employees for each working day in each of twenty or more calendar weeks in the current or preceding calendar year, and any agent of such a person.... See 42 U.S.C. § 2000e(b). Person is defined as including one or more individuals, governments, governmental agencies, political subdivisions, labor unions, partnerships, associations, corporations, legal representatives, mutual companies, joint-stock companies, trusts, unincorporated organizations, trustees, trustees in cases under Title 11, or receivers. See 42 U.S.C. § 2000e(a). Because we have treated the question of whether a defendant meets the statutory definition of employer as a threshold jurisdictional matter under Title VII, see Virgo v. Riviera Beach Associates, Ltd., 30 F.3d 1350, 1359 (11th Cir.1994), 3 a plaintiff must show that her employer had fifteen or more employees for the requisite period provided under the statute before her Title VII claims can be reached. 35 It is undisputed that the CRA itself, during the relevant time, did not employ a sufficient number of individuals to fall within the statutory definition of employer. It is also undisputed that if the CRA and the City are counted as one, collectively they employ enough people to meet that definition. Lyes argues that the two entities should be aggregated and treated as a single employer under Title VII, because the CRA and the City are interrelated in their operations and both entities exercised substantial control over her conditions of employment. By contrast, the CRA and the City contend that they are separate and distinct legal entities and should be treated as such, which would remove the CRA from Title VII's definition of employer and effectively deprive us of jurisdiction over that claim in this case. We must therefore decide what test applies in determining whether separate state or local governmental entities should be counted as a single employer for purposes of meeting the statutory definition under Title VII.
36 We accord a liberal construction to the term employer under Title VII. See Virgo, 30 F.3d at 1359; McKenzie v. Davenport-Harris Funeral Home, 834 F.2d 930, 933 (11th Cir.1987); Williams v. City of Montgomery, 742 F.2d 586, 588 (11th Cir.1984). In keeping with this liberal construction, we sometimes look beyond the nominal independence of an entity and ask whether two or more ostensibly separate entities should be treated as a single, integrated enterprise when determining whether a plaintiff's employer comes within the coverage of Title VII. 37 We have identified three circumstances in which it is appropriate to aggregate multiple entities for the purposes of counting employees. First, where two ostensibly separate entities are  'highly integrated with respect to ownership and operations,'  we may count them together under Title VII. McKenzie, 834 F.2d at 933 (quoting Fike v. Gold Kist, Inc., 514 F.Supp. 722, 726 (N.D.Ala.), aff'd, 664 F.2d 295 (11th Cir.1981)). This is the single employer or integrated enterprise test. Second, where two entities contract with each other for the performance of some task, and one company retains sufficient control over the terms and conditions of employment of the other company's employees, we may treat the entities as joint employers and aggregate them. See Virgo, 30 F.3d at 1359-60. This is the joint employer test. Third, where an employer delegates sufficient control of some traditional rights over employees to a third party, we may treat the third party as an agent of the employer and aggregate the two when counting employees. See Williams, 742 F.2d at 589. This is the agency test. See generally 2 Barbara Lindemann & Paul Grossman, Employment Discrimination Law 1309-17 (3rd ed.1996). 38 The issue before us involves the single employer test. 4 In determining whether two non-governmental entities should be consolidated and counted as a single employer, we have applied the standard promulgated in NLRA cases by the National Labor Relations Board. See, e.g., McKenzie, 834 F.2d at 933. This standard sets out four criteria for determining whether nominally separate entities should be treated as an integrated enterprise. Under the so-called NLRB test, we look for (1) interrelation of operations, (2) centralized control of labor relations, (3) common management, and (4) common ownership or financial control. Id.See also Radio and Television Broad. Technicians Local Union 1264 v. Broadcast Serv. of Mobile, Inc., 380 U.S. 255, 256, 85 S.Ct. 876, 877, 13 L.Ed.2d 789 (1965). 5 39 The four-factor NLRB single employer test was first applied in the Title VII context in Baker v. Stuart Broad. Co., 560 F.2d 389 (8th Cir.1977). Since that time, most of the circuits considering whether to integrate multiple entities under Title VII have seized upon that test. See, e.g., Schweitzer v. Advanced Telemarketing Corp., 104 F.3d 761, 764 (5th Cir.1997); Cook v. Arrowsmith Shelburne, Inc., 69 F.3d 1235, 1241 (2d Cir.1995); Childs v. Local 18, Int'l Bhd. of Elec. Workers, 719 F.2d 1379, 1382 (9th Cir.1983); Armbruster, 711 F.2d at 1337-38 (6th Cir.). We, too, have applied the NLRB test. See McKenzie, 834 F.2d at 933. As one court employing the test noted, the similarity in language between the NLRA and Title VII, and the fact that statute served as a model for Title VII, makes decisions under the NLRA a useful resource for interpreting the language of Title VII. See 29 U.S.C. § 152(2); Armbruster, 711 F.2d at 1336 (Since it is clear that the framers of Title VII used the NLRA as its model, ... we find the similarity in language of the Acts indicative of a willingness to allow the broad construction of the NLRA to provide guidance in the determination of whether, under Title VII, two companies should be deemed to have substantial identity and treated as a single employer.).
40 However useful the four-factor NLRB single employer test may be in Title VII cases where private entities are concerned, the question we face is the different one of whether that test should be applied where state and local governmental entities are concerned. In answering that question, we are aware of Congress's unmistakable intent that Title VII principles be applied to governmental and private employers alike. Dothard v. Rawlinson, 433 U.S. 321, 331 n. 14, 97 S.Ct. 2720, 2728 n. 14, 53 L.Ed.2d 786 (1977). See also Owens v. Rush, 636 F.2d 283, 287 (10th Cir.1980) (Governmental subdivisions were brought within the reach of Title VII in the 1972 amendments to Title VII so that '[a]ll state and local government employees would ... have access to the remedies available under the Act.' ) (quoting 1972 U.S.C.C.A.N. 2137, 2152). 41 But we are also aware of the unmistakable reality that in certain key respects, governmental entities are different from private ones. We will discuss some of those differences later. For now, it is worth noting that equal treatment consists not only of treating like things alike, but also of treating unlike things differently according to their differences. This is a proposition whose provenance stretches back to antiquity, see, e.g., Aristotle, The Nicomachean Ethics, E.6.1131a-1131b (M. Ostwald trans.1962), and it has as much logical force now as it had in Aristotle's day. If we are to apply Title VII's principles equally to governmental and private employers in a fair and intelligible manner, we must apply those principles in a way that respects the differences between private and public entities. See also Riley v. County of Pike, 761 F.Supp. 74, 76 (C.D.Ill.1991) (applying the NLRB factors but noting that [i]n addition to these factors, when the employers in question are government entities, additional criteria come into play.). 42 The four NLRB factors are useful for counting employees of private entities under Title VII, precisely because the test was developed by the National Labor Relations Board to determine whether consolidation of separate private corporations is proper in determining the relevant employer under the NLRA. Owens, 636 F.2d at 286 n. 2 (emphasis added). Of course, the NLRA does not cover public employers, see 29 U.S.C. § 152(2), and it is hardly surprising that a test designed to operate in the context of private entities does not fit well cases involving governmental entities. States are not the equivalent of corporations or companies, and local government bodies are not the same as subsidiaries. With this in mind, we join those courts that have concluded that the [four-part NLRB] standard is not readily applicable to governmental subdivisions[.] Trevino v. Celanese Corp., 701 F.2d 397, 404 n. 10 (5th Cir.1983); Piper v. Junction City Hous. Auth., 1995 WL 88232, at  3 (D.Kan. Feb.1, 1995). See also Massey v. Emergency Assistance, Inc., 724 F.2d 690, 692 (8th Cir.1984) (Lay, C.J., dissenting) (I think it clear such test is not applicable to a factual situation concerning governmental entities.). 6 But see Artis v. Francis Howell North Band Booster Ass'n, Inc., 1998 WL 846889, at  6, 161 F.3d 1178 (8th Cir.1998) (applying, without discussion, the NLRB test to a private entity and a government entity and deciding that they should not be combined); Massey, 724 F.2d at 690-91 (affirming, without discussion, the district court's application of the NLRB test to a government entity and the decision that it should not be aggregated with a private entity); Vandermeer v. Douglas Cty., 15 F.Supp.2d 970, 974-75 (D.Nev.1998) (applying NLRB test to county and local fire and paramedic districts, but noting that [t]he fact that Nevada may consider Douglas County and the Districts to be separate political subdivisions, while relevant, does not control.); Rivera, 922 F.Supp. at 949; County of Pike, 761 F.Supp. at 76-77 (applying NLRB test to Pike County and Pike County State's Attorney's office in ADEA case, but concluding that they should not be treated as an integrated enterprise). 43 The most obvious way in which the NLRB single employer test is incompatible with cases involving governmental entities involves the test's fourth factor--common ownership or financial control. McKenzie, 834 F.2d at 933. Governmental subdivisions such as counties or towns, or smaller subdivisions such as local agencies, may share sources of ultimate political control or funding, yet be wholly distinct with respect to their day-to-day operations or their control over relationships with employees. Thus, the common ownership or financial control factor of the NLRB test has no application to the usual case involving governmental subdivisions. 44 Nor is the NLRB test's third factor, common management, McKenzie, 834 F.2d at 933, readily applicable in the case of governmental entities. While it may be an appropriate yardstick in some instances, in others two public entities may share managers or other employees while remaining politically separate and distinct. In the present case, for example, each member of the City Council also serves as a member of the CRA Board of Commissioners, but those city councillors in their different capacity as commissioners comprise, by law, a distinct and independent body. The Florida legislation that permits the members of a local governing body to declare themselves a community redevelopment agency, explicitly provides that such members constitute the head of a legal entity, separate, distinct, and independent from the governing body of the county or municipality. Fla. Stat. Ann. § 163.357(b) (West 1990). So the common management factor, too, is not applicable in the context of governmental entities, at least not in a case like this one. 7 45 In addition to the fact that these two prongs do not make sense in the context of state and local governmental entities, there is another, perhaps more fundamental reason for not applying the NLRB test. That reason involves federalism and comity concerns, which should play a significant role in determining whether to treat as one body two governmental entities that are separate and distinct under state law. When it comes to creating subordinate public bodies and defining their relationship to one another and to itself,  'the state is supreme and its legislative body, conforming its action to the state Constitution, may do as it will.'  City of Trenton v. State of New Jersey, 262 U.S. 182, 186-87, 43 S.Ct. 534, 536, 67 L.Ed. 937 (1923) (quoting Hunter v. Pittsburgh, 207 U.S. 161, 178, 28 S.Ct. 40, 46, 52 L.Ed. 151 (1907)). Defining the nature and relationship of such bodies, no less than determining their level of funding, is uniquely an exercise of state sovereignty. DeKalb Cty. Sch. Dist. v. Schrenko, 109 F.3d 680, 689 (11th Cir.) (quoting Stanley v. Darlington Cty. Sch. Dist., 84 F.3d 707, 716 (4th Cir.1996)), cert. denied, 118 S.Ct. 601 (1997). We owe such determinations by the state legislature not only deference, but great deference. 46 In rejecting the four-factor NLRB test as a means of determining whether two or more governmental entities should be aggregated for the purposes of determining if they are an employer under Title VII, we do not mean to suggest that the two remaining prongs of the test, interrelation of operations and centralized control of labor relations, are not relevant to our inquiry in any way. But where state or local governmental entities are involved, any indicia of integration must be considered in a framework that is sensitive to the differences between governmental subdivisions and private entities. See Trevino, 701 F.2d at 404 n. 10.
47 Given our conclusion that the traditional NLRB four-factor test is not readily applicable to the question of whether to aggregate state and local governmental entities for Title VII purposes, we must decide what standard or test should apply in its place. 8 Our inquiry must be guided by a combination of respect [for] the way a state chooses to structure its government [,] McMillian v. Johnson, 88 F.3d 1573, 1580-81 (11th Cir.1996), aff'd, 520 U.S. 781, 117 S.Ct. 1734, 138 L.Ed.2d 1 (1997) (citing City of St. Louis v. Praprotnik, 485 U.S. 112, 126, 108 S.Ct. 915, 925, 99 L.Ed.2d 107 (1988)), as well as recognition of our obligation to accord a liberal construction to the terms of Title VII. See, e.g., Virgo, 30 F.3d at 1359. 48 The strong comity and federalism concerns we have mentioned require that we accord substantial deference to a state lawmaking body's determination of whether two or more governmental entities are separate and distinct. We should not brush aside a state's own distinctions between its governmental subdivisions, because even ostensibly formal distinctions are part of a government's ability to shape its own institutions within constitutional bounds, and we are obligated to respect a state's right to do so. See McMillian, 88 F.3d at 1581 ([W]e heed the Supreme Court's admonition that federal courts respect the way a state chooses to structure its government.). There are few things closer to the core of a state's political being and its sovereignty than the authority and right to define itself and its institutions in relation to each other. Of course, states cannot abuse that power to evade federal law, but it is unlikely that a state would structure its state and local entities with that purpose in mind. Such an evasive purpose is especially unlikely in a state like Florida, which has enacted its own anti-discrimination legislation and made it applicable to local governmental agencies. See Fla. Stat. Ann. § 760.02(6) (West 1997) (defining person under the Florida Civil Rights Act of 1992 to include any governmental entity or agency.). 49 We think that where a state legislative body creates a public entity and declares it to be separate and distinct, that declaration should be entitled to a significant degree of deference, amounting to a presumption that the public entity is indeed separate and distinct for purposes of Title VII. The presumption may be rebutted in some instances. In particular, if it is established that a state's purpose in creating or maintaining nominally separate entities was to evade the reach of the federal employment discrimination laws, that alone is enough for those entities to be aggregated when counting employees. 50 Even absent an intent to evade the application of federal law, we will aggregate two or more governmental entities and treat them as a single Title VII employer where other factors so plainly indicate integration that they clearly outweigh the presumption that the entities are distinct. In order to determine which factors should be considered in deciding whether the plaintiff has carried her burden of showing that the presumption has been clearly outweighed, we look to the factors courts have considered in Title VII cases involving private employers. 51 Despite the primacy of the NLRB test as applied to private employers under Title VII, [c]ourts have used numerous formulations in assessing whether a defendant is an 'employer' within the meaning of Title VII and other employment discrimination statutes. Rivera, 922 F.Supp. at 949. Our review of the different factors that have been considered convinces us that they all share a common focus: all of them seek to determine who (or which entity) is in control of the fundamental aspects of the employment relationship that gave rise to the claim. See, e.g., id. at 949 ([The different tests] all have in common a focus on one factor at issue here: the amount of control or supervision a defendant exerts.); Armbruster, 711 F.2d at 1337 ([C]ontrol over the elements of labor relations is a central concern of the NLRB test); Trevino, 701 F.2d at 404 (centralized control of labor relations test has been further refined to the point that [t]he critical question to be answered then is: What entity made the final decisions regarding employment matters related to the person claiming discrimination?) (internal quotation and citation omitted); Chester v. Northwest Iowa Youth Emergency Servs. Ctr., 869 F.Supp. 700, 717-18 & n. 10 (N.D.Iowa 1994) (collecting cases and noting that control of employment decisions and environment is one of the central features of the tests). 52 Thus, two or more state or local governmental entities will be treated as a single employer under Title VII where one entity exerts or shares control over the fundamental aspects of the employment relationships of another entity, to such a substantial extent that it clearly outweighs the presumption that the entities are distinct. Several factors will guide our determination of whether the presumption in favor of the distinctness of the public entities is clearly outweighed--or, at the summary judgment stage, whether a finder of fact could reasonably conclude that it is clearly outweighed. As we have already noted, the NLRB factors of interrelation of operations and centralized control of labor operations, McKenzie, 834 F.2d at 933, may continue to be helpful in the inquiry. Useful indicia of control may be drawn from the agency context, including:  'the authority to hire, transfer, promote, discipline or discharge; the authority to establish work schedules or direct work assignments; [and] the obligation to pay or the duty to train the charging party.'  Oaks v. City of Fairhope, Ala., 515 F.Supp. 1004, 1035 (S.D.Ala.1981) (quoting Barbara Schlei and Paul Grossmann, Employment Discrimination Law 846 (1st ed.1976)). Our list of factors is not intended to be all inclusive, and consideration must be given to the totality of the circumstances. 53 To summarize, we hold that when assessing whether multiple governmental entities are a single employer under Title VII, we begin with the presumption that governmental subdivisions denominated as separate and distinct under state law should not be aggregated for purposes of Title VII. That presumption may be rebutted by evidence establishing that a governmental entity was structured with the purpose of evading the reach of federal employment discrimination law. Absent an evasive purpose, the presumption against aggregating separate public entities will control the inquiry, unless it is clearly outweighed by factors manifestly indicating that the public entities are so closely interrelated with respect to control of the fundamental aspects of the employment relationship that they should be counted together under Title VII. 54 The standard we adopt is not whether a fact finder reasonably could conclude the plaintiff has overcome the presumption. Instead, the standard is whether the fact finder reasonably could conclude the plaintiff has clearly overcome the presumption. The adverb clearly, which derives from the federalism concerns we have discussed, is meant to be limiting. It is a thumb on the scale, and sometimes it will be decisive because federalism concerns should sometimes be decisive. Absent evidence of evasive purpose, in order to survive a motion for summary judgment, a plaintiff will have to show that a reasonable fact finder could conclude that the presumption of distinctness is clearly outweighed.
55 Applying this test to the present case, we conclude that Lyes has not adduced sufficient evidence to allow a reasonable fact finder to conclude that the City and the CRA should be treated as a single employer, bringing them within the coverage of Title VII. 9 See, e.g., Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 252, 106 S.Ct. 2505, 2512, 91 L.Ed.2d 202 (1986) (the court must ask whether reasonable jurors could find by a preponderance of the evidence that the plaintiff is entitled to a verdict....); Raney v. Vinson Guard Serv., Inc., 120 F.3d 1192, 1198 (11th Cir.1997) ([T]he plaintiff is effectively required to put forth her entire case at summary judgment [to] persuade the court that a reasonable fact finder could rule in the plaintiff's favor.) (internal quotation and citation omitted). 56 Florida law establishes a presumption that the CRA and the City are separate and distinct bodies. As the district court noted, the State legislature created community redevelopment agencies as independent legal bodies. See Fla. Stat. Ann. § 163.356 et seq. (West 1990 & Supp.1999). With the exception of certain enumerated powers, they are granted all the powers necessary or convenient to carry out and effectuate the purposes and provisions of [the community redevelopment agency legislation].... Fla. Stat. Ann. § 163.358 (West 1990 & Supp.1999). The five City Council members also serve as the Board of Commissioners of the CRA. But Fla. Stat. § 163.357, which permits this arrangement, also states that [t]he members of the governing body shall be the members of the agency, but such members constitute the head of a legal entity, separate, distinct, and independent from the governing body of the county or municipality. Fla. Stat. Ann. § 162.357(1)(b) (West 1990). See also 1991 Fla. Op. Att'y. Gen. 148 (No. 91-49, 1991). The clear distinction Florida law draws between the CRA and the City raises the presumption that they are separate and distinct entities. 10 57 Looking at the nature of Lyes's employment relationship itself, we conclude that she has not produced evidence of interrelatedness with regard to control over employment sufficient to permit a reasonable fact finder to conclude that the presumption that the governmental entities are distinct is clearly outweighed. The CRA Board of Commissioners and its Executive Director control the fundamental aspects of employment of the CRA's staff. The Executive Director hires and supervises the staff, and the Board may hire, fire, and establish work schedules and assignments. The Executive Director is employed by the CRA, and he serves at the pleasure of the CRA Board, not at the pleasure of the City. Employees of the CRA receive their medical benefits, life insurance and pension plans from the CRA, not from the City. Lyes was disciplined, suspended and eventually terminated by the Executive Director of the CRA, and that decision was upheld by the CRA Board, not by the City. All of these circumstances establish that the CRA retained and exercised control over the fundamental aspects of its employee relations. 58 The panel below cited some evidence in support of its conclusion that the CRA and City should be treated as a single employer. See 126 F.3d at 1386-87. Of that evidence, two matters deserve discussion. First, the panel pointed to a performance review of Lyes which was completed by the Executive Director on a City form, listing the CRA as a department of the City. The performance review was performed by Tony Smith, who was serving at the time as both City Manager and interim Executive Director of the CRA. Given his dual duties, we do not think the fact that he used City stationery has much, if any, significance. State law cannot be amended by inferences drawn from printed forms. 59 Second, the panel noted that Neil Crilly, the CRA Executive Director, sought review from the City's personnel director of his decision to discipline Lyes. We agree with the district court's conclusion that there was no indication that this review had any binding effect. Instead, it appears to have been an effort to seek the opinion of a third party as to whether Crilly had acted fairly in disciplining Lyes. In this sense, Crilly's action is not unlike seeking advice from an expert in employee relations. 11 60 Viewing the totality of the circumstances, we readily conclude that Lyes has not produced evidence sufficient to allow a reasonable fact finder to conclude that the presumption that the CRA and the City are separate entities is clearly outweighed and that they should therefore be treated as a single employer under Title VII.
61 Having decided the issues upon which we granted en banc review, we REMAND this case to the panel for further proceedings not inconsistent with this decision. 62