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When it comes to discrimination lawsuits, are you an employer or an employee?

On Behalf of | Feb 3, 2021 | Workplace Discrimination |

If you’re a high-level executive or partner in a company, are you entitled to discrimination protection under Title VII of the 1964 Civil Rights Act?

The answer isn’t clear — yet. Here’s why it matters: If you’re an employee who suffers discrimination, wrongful termination, workplace bullying or sexual harassment, you can bring a lawsuit under Title VII. If you’re an employer, however, you can’t.

The issue often gets tested in court when the victim of discrimination or harassment files a lawsuit and the company responds by asking the court to dismiss the case because the plaintiff was never an “employee” but an “employer” who isn’t entitled to protection under federal anti-discrimination laws of any kind, including the Americans With Disabilities Act (ADA).

How can you tell what standing you have?

Quite often, the line gets drawn very thin. In 2003, the Supreme Court of  the United States (SCOTUS) outlined a series of tests that indicate which side of that line plaintiffs fall on, and that test was further clarified in another lawsuit in 2021. The key factors include:

  • What size is the company? If they’re part of a relatively large firm, they may have far less control over their own work or compensation than the partner in a small firm.
  • Are they an equity partner or an income/non-equity partner? An equity partner is unlikely to be considered an employee for the purposes of a lawsuit.
  • How much authority do they have to hire and fire other shareholders, managers and executives? If it is equal to their other partners, they probably aren’t an employee.
  • Do they have a partnership agreement and receive a K1 tax form instead of a W2, like an employee? This could be pivotal in court.
  • Do they have wide latitude in how they manage their work, or is their work overseen and controlled by someone higher in authority? If it is, they may be an employee.

These are not the only factors the court may consider but they do give you a fair idea of what may come into play.

When you’ve suffered discrimination or harassment at work

Don’t guess about your rights. Speak to an advocate who can help you better understand your position and the steps you need to take to protect your future.

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