InsideCounsel » May 2008
Independent Contractor Sues Under Title VII
Dr. Barbara Salamon was a physician with hospital staff privileges at Our Lady of Victory Hospital when she claims her supervisor began sexually harassing her.
Generally, physicians with hospital staff privileges are deemed independent contractors and are not offered the same civil protections as employees. But regardless, Salamon filed a sexual harassment lawsuit in 1999, claiming the Lackawanna, N.Y., hospital violated her Title VII and New York City Human Rights Law (NYHRL) rights.
The 2nd Circuit recently gave Salamon’s action the green light, even though both laws only protect “employees.”
The panel ruled it was at least arguable, on the facts pleaded by Salamon, that she was a hospital employee, despite setting her own hours, directly billing her own patients and collecting neither salary nor benefits from the hospital.
Experts believe the court has opened the door to new Title VII claims from thousands of people who are usually pegged as independent contractors, including lawyers and others who exercise independent professional judgment.
“This decision has implications for every employer that hires independent contractors,” says Shaffin Datoo, a lawyer with Venable. “Employers will have to make sure to treat independent contractors differently than employees. Failure to do so may impose liability upon the employer under the anti-discrimination laws, and unemployment and workers’ compensation laws,” he says.
The hospital defendants have since petitioned the 2nd Circuit for en banc review, arguing that the panel’s judgment upends conventional legal wisdom within the circuit and conflicts directly with decisions from the 4th, 5th, 6th and 7th circuits. Salamon’s lawsuit was thrown out in 2006 by the New York district court, which granted summary judgment to the defendants after ruling the doctor was an independent contractor.
But the 2nd Circuit revived the action in January, saying while “summary judgment may be appropriate in some cases concerning staff physicians suing hospitals, it is not appropriate in all.”
Control Key
The panel also emphasized “there is nothing intrinsic to the exercise of discretion and professional judgment that prevents a person from being an employee. ... The issue is the balance between the employee’s judgment and the employer’s control.”
Salamon, a gastroenterologist and internist, earned satisfactory performance reviews for two years before things turned ugly. She says the catalyst was her 1996 complaint that Dr. Michael C. Moore, the chief of gastroenterology at that time, was sexually harassing her. She says he made inappropriate remarks about her appearance and harassed her with unwanted sexual advances. When she protested to upper management, she claims the hospital retaliated by criticizing and monitoring her work.
