Daggitt v. United Food & Commercial Workers International Union, Local 304A ( 2001 )

United States Court of Appeals
FOR THE EIGHTH CIRCUIT
___________
No. 00-1319
___________
Patricia A. Daggitt, *
*
Appellee, *
*
v. *
*
United Food and Commercial * Appeal from the United States
Workers International Union, * District Court for the
Local 304A, * District of South Dakota.
*
Appellant, *
*
United Food and Commercial Workers *
International Union, AFL-CIO, *
*
Defendant. *
___________
Submitted: October 19, 2000
Filed: April 4, 2001
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Before McMILLIAN, BOWMAN, and LOKEN, Circuit Judges.
___________
BOWMAN, Circuit Judge.
United Food and Commercial Workers International Union, Local 304A (UFCW
or union), appeals from an adverse jury verdict in a Title VII sex discrimination and
sexual harassment suit brought by Patricia Daggitt. UFCW argues that the District
Court1 should have dismissed Daggitt's sexual harassment claim for lack of subject
matter jurisdiction, and that the court improperly enhanced the attorney fees awarded
to Daggitt's counsel. We affirm.
I.
UFCW represented Daggitt during her employment with John Morrell & Co. as
a traffic clerk and dispatcher in Sioux Falls, South Dakota. Daggitt actively
participated in the union, serving on its executive board and working for the union as
treasurer and part-time assistant business agent. In 1998, Daggitt sued UFCW,
asserting claims for sex discrimination and sexual harassment under Title VII, 42
U.S.C. §§ 2000e to 2000e-17 (1994 & Supp. IV 1998), assault and battery, and
intentional infliction of emotional distress. Before trial, UFCW moved for summary
judgment, asserting that the District Court lacked subject matter jurisdiction over the
union because it was not an "employer" as defined by Title VII. To be subject to suit
under Title VII, an employer must have "fifteen or more employees for each working
day in each of twenty or more calendar weeks in the current or preceding calendar
year." 42 U.S.C. § 2000e(b). UFCW claimed it did not meet this fifteen-employee
threshold. The District Court denied summary judgment, finding that UFCW in fact
met the employee threshold because the union's shop stewards counted as employees
for purposes of jurisdiction under Title VII. Daggitt v. United Food & Commercial
Workers Int'l Union Local 304A, 59 F. Supp. 2d 980, 984 (D.S.D. 1999).
The jury returned a verdict in favor of Daggitt on her sex discrimination, sexual
harassment, and intentional infliction of emotional distress claims. The jury found that
UFCW discriminated against Daggitt on the basis of sex, but only in its capacity as a
labor organization and not as her employer, and awarded Daggitt $5000 in punitive
1
The Honorable Lawrence L. Piersol, Chief Judge, Unites States District Court
for the Southern District of South Dakota.
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damages. On the sexual harassment claim, the jury rendered a general verdict in
Daggitt's favor, awarding her $50,000 in punitive damages. The jury form did not
specify whether the jury found that the union had sexually harassed Daggitt in its
capacity as a labor organization or as an employer. Following additional post-trial
motions, the District Court entered an amended judgment awarding Daggitt $33,847.13
in attorney fees and $893.57 in expenses pursuant to 42 U.S.C. § 2000e-5(k), and
specifying that a $50,000 cap on total punitive damages applied to Daggitt's award,
see 42 U.S.C. § 1981a(b)(3)(A) (1994). UFCW appeals only the verdict on Daggitt's
sexual harassment claim and the attorney fees award.
II.
Title VII authorizes suit against certain employers, 42 U.S.C. § 2000e-2(a), and
against labor organizations, 42 U.S.C. § 2000e-2(c), as long as the statutory definitions
are met. 42 U.S.C. § 2000e(b), (d) (definitions). The parties agree that UFCW is a
labor organization within the meaning of Title VII.
Daggitt contends that her sexual harassment claim proceeded against the union
both as a labor organization of which she was a member and as her employer. The
union disputes this contention, claiming in its brief that Daggitt's sexual harassment
claim was pleaded and submitted to the jury against the union solely in its capacity as
her employer. We disagree.2
2
Count one (sex discrimination) of Daggitt's complaint against UFCW alleges
violations of both 42 U.S.C. § 2000e-2(c)(1) and § 2000e-2(c)(2). It sets out a factual
basis for these allegations that includes actions taken in relation to Daggitt's
employment by the union and in relation to her participation in the union as a member.
Count two (sexual harassment) incorporates by reference all the allegations in count
one and alleges that the actions cited also created a hostile working environment for
Daggitt in violation of Title VII. We need not address UFCW's assertion that Daggitt
failed to sufficiently plead a sexual-harassment-in-union-participation claim because we
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The plain language of the unchallenged jury instructions belies UFCW's
assertion. Instruction eight states that Daggitt claimed the union's sexual harassment
created "a hostile or abusive environment which prevented the plaintiff from performing
her duties as Assistant Business Agent and treasurer and in fully participating in union
activities." Jury instruction fourteen further describes Daggitt's sexual harassment
claim: "The plaintiff claims that Local 304A created a hostile or abusive environment,
which impacted her both as a union employee and as a participating member of the
labor union." It directs the jury to "determine whether the harassment was sufficiently
severe or extensive to alter the conditions of the plaintiff's employment or to alter the
extent to which the plaintiff could participate in union activities." Further, the
instruction charges the jury to "also consider the physical environment at the Labor
Temple and at John Morrell & Company where the plaintiff participated in union
activities as a union employee and union member." Finally, instruction fifteen directs
the jury that, "[t]o establish a claim for sexual harassment based on a hostile or abusive
environment, the plaintiff must prove that the conduct of Local 304A officers and
members toward her while she worked as a Local 304A employee and participated in
union activities would not have occurred but for her gender." We find that the above-
emphasized language of instructions eight, fourteen, and fifteen clearly and
unambiguously directed the jury to consider Daggitt's sexual harassment claim both in
the context of her employment by UFCW and in the context of her participation as a
member of the union.
UFCW submitted objections to the jury instructions and verdict form, but made
no objection to instructions eight, fourteen, or fifteen. The union thus has waived any
assignment of error to those instructions. See Fed. R. Civ. P. 51 ("No party may assign
find that the claim was before the court and submitted to the jury without objection
from the union. We note, furthermore, that even if we accepted UFCW's argument and
found that Daggitt's sexual harassment claim had not been submitted to the jury at all
on a labor organization theory of liability, our determination of the status of the union's
stewards would control and lead us to affirm the jury's verdict. See infra Part III.
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as error the giving [of] an instruction unless that party objects thereto before the jury
retires to consider its verdict, stating distinctly the matter objected to and the grounds
of the objection."); Phillips v. Parke, Davis & Co., 869 F.2d 407, 409 (8th Cir. 1989)
("Rule 51 makes it incumbent upon the attorneys in a civil case to ascertain how the
jury is to be instructed and to state any objections before the jury retires."). Where a
party has waived an objection to a jury instruction, we review the instruction for plain
error. Reversal will be warranted only in "'the exceptional case where the error has
seriously affected the fairness, integrity, or public reputation of judicial proceedings.'"
Figge Auto Co. v. Taylor, 325 F.2d 899, 907 (8th Cir. 1964) (citation to quoted
authority omitted). This suit does not present such an exceptional case. Thus, we find
that Daggitt's sexual harassment claim was properly before the jury on a union-
participation theory.3
III.
Daggitt asserted her sexual harassment claim against UFCW on a second theory
of liability that also was submitted to the jury—that she was sexually harassed as an
employee of the union. Where a jury renders a general verdict on claims presented
under two or more theories, and where the reviewing court is unable to determine the
theory upon which the jury based its award, each theory standing alone must provide
a legally sound basis for granting relief. Robertson Oil Co. v. Phillips Petroleum Co.,
871 F.2d 1368, 1375 (8th Cir. 1989). If one of the theories is found to be an unsound
basis for relief, the reviewing court must reverse and remand for a new trial on only the
legally sound theories. Id. Because we cannot ascertain whether the jury awarded
Daggitt punitive damages on her sexual harassment claim because of the union's actions
as her labor organization or as her employer, we must address the question of whether
3
Because UFCW does not challenge the sufficiency of the evidence supporting
the jury's verdict on this claim, we make no determination on that issue.
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the District Court had jurisdiction to entertain Daggitt's employer-liability theory under
Title VII.
UFCW argues that the District Court should have dismissed Daggitt's sexual
harassment claim for lack of subject matter jurisdiction under Title VII because the
court erred in holding that the local union's stewards are "employees" of the union. The
District Court found that for the relevant time periods UFCW had approximately fifty
union stewards.4 Daggitt, 59 F. Supp. 2d at 982. In addition, the District Court found
that without counting the union stewards the union had only ten or eleven employees
during those years. Id. Thus, the status of the union stewards controls jurisdiction in
this case. Whether union stewards can be counted as employees for jurisdictional
purposes in a Title VII case is a question of first impression in this Circuit.5
In reviewing the District Court's determination that the UFCW's shop stewards
are employees of the union for purposes of federal-court subject-matter jurisdiction
over Title VII claims against the union in its capacity as an employer, we apply the
4
Title VII requires that the employer have fifteen employees for twenty or more
calendar weeks in the current or preceding calendar year. 42 U.S.C. § 2000e(b).
Daggitt's claims arose from acts committed in 1996 and 1997; hence the years relevant
to counting the union's employees are 1995, 1996, and 1997.
5
Although our search uncovered no on-point cases in this Circuit, or in other
circuits, courts have held, in other contexts, that union stewards were or should have
been treated as employees or agents of their union. See, e.g., Reinforcing Iron Workers
Local Union 426 v. Bechtel Power Corp., 634 F.2d 258 (6th Cir. 1981) (concluding
employer payments to industry steward fund violated § 302(a) of Labor Management
Relations Act because steward was not employee of the employer); NLRB v. Int'l
Longshoremen's & Warehousemen's Union, Local 10, 283 F.2d 558 (9th Cir. 1960)
(holding labor union culpable under Taft-Hartley Act for acts performed by its agents,
i.e., by union stewards); Caldwell v. Farley, 285 P.2d 294 (Cal. Dist. Ct. App. 1955)
(sustaining determination that assault committed by union steward during discussion
about possible strike was committed within scope of steward's agency with union).
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ordinary standards of appellate review. Thus, we review factual findings for clear error
and we review legal conclusions de novo. Appley Bros. v. United States, 164 F.3d
1164, 1170 (8th Cir. 1999).
The union argues that its stewards should not be counted as employees because
they are in "volunteer position[s] reserved for Union members in good standing who
receive their co-workers' vote of confidence through election." Appellant's Brief at 21.
Furthermore, the union argues, stewards do not receive "net income" from performing
their duties; in other words, for performing their duties as stewards they do not make
money over and above their usual salaries received as employees of John Morrell.
The District Court found that the union awarded three types of monetary
benefits to its stewards. First, UFCW reimbursed stewards for the full amount of the
union dues withheld by John Morrell from the stewards' paychecks during the
preceding quarter. The reimbursement payments could be as high as ninety-one dollars
per quarter. Second, UFCW paid the stewards for "lost time." When a steward was
required to perform union duties during the steward's regular work time at John
Morrell, the company would dock the steward's regular pay for the time missed. This
docked time, called "lost time," would be compensated by the union at the employee's
regular pay rate through a voucher and separate payment system. The union required
stewards to fill out W-4 tax forms to receive "lost time" pay, and the union issued
stewards W-2 tax forms each year reflecting these payments. Finally, each year UFCW
paid an employer contribution into the 401(k) plan at John Morrell in an amount equal
to the contribution lost by each steward by reason of attending to union affairs during
work hours. These findings of fact are not clearly erroneous. Indeed, they are
undisputed. We therefore turn to the law applicable to determining employee status for
purposes of Title VII.
Title VII defines "employee" as "an individual employed by an employer." 42
U.S.C. § 2000e(f). Such a circular definition adds little to our inquiry. Thus, we must
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consider traditional definitions of employer and employee to identify the relationship
required by § 2000e(b). Graves v. Women's Prof'l Rodeo Ass'n, 907 F.2d 71, 73 (8th
Cir. 1990) (finding legislative history of Title VII explicitly provides that dictionary
definition of employee should govern). "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." Id. Compensation is an "essential
condition to the existence of an employer-employee relationship." Id. Without
compensation, no combination of other factors will suffice to establish the relationship.
UFCW argues that its members who are stewards do not receive "material
compensation" or "net income" from UFCW for the stewards' services, and thus they
are not employees for purposes of Title VII. The union defines material compensation
as payment that gives the steward income over and above the income the steward
would earn at John Morrell if the steward did not have to clock out to perform union
duties. Reimbursement of union dues paid by the stewards should not be counted as
material compensation, according to UFCW, because such reimbursement is a matter
of union membership policy. These payments, the union argues, merely reflect
reimbursement of costs incurred in holding a volunteer position in the union.
We disagree and conclude that the District Court correctly determined that
monetary benefits flowing from UFCW to its stewards amounted to compensation for
their services. The lost-time pay received by the stewards is part of the stewards'
earned income, as evidenced by the use of W-4 and W-2 forms to account for these
payments. See Eisenberg v. Advance Relocation & Storage, Inc., 237 F.3d 111 (2d
Cir. 2000) (holding that defendant's use of 1090 form rather than W-2 form favored
identifying plaintiff in Title VII suit as independent contractor rather than employee).
UFCW's contributions to the John Morrell 401(k) plan also indicate that for some
portion of the time that the stewards are at work, UFCW is directly responsible for the
stewards' wages and for employee benefits that are tied to the amount of those wages.
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Union reimbursement of stewards' dues also compensates the stewards for their
service as union representatives. The union's characterization of these payments as
mere matters of union membership is not controlling here. UFCW reimburses the
stewards' union dues because the stewards are performing a vital service in furtherance
of the union's purpose—representing the interests of employees in enforcing the
collective bargaining agreement within the workplace. Reimbursement is but a form
of compensation for performing a service for the union. Thus, the union's assertion that
such reimbursement is merely a policy choice regarding their treatment of certain union
members fails to convince us that the monies stewards receive should not be construed
as compensation indicative of an employer-employee relationship. Because we are
satisfied that compensation flowed from the union to the stewards, our analysis turns
to examining other aspects of the parties' relationship.
Previous challenges to Title VII jurisdiction based on a labor union's status as
an employer have focused on whether members of a union's executive board may be
counted toward Title VII's fifteen-employee requirement. See, e.g., Kern v. City of
Rochester, 93 F.3d 38, 47 (2d Cir. 1996) (holding non-officer executive board members
did not perform traditional employee duties and therefore were not employees for
purposes of Title VII jurisdiction), cert. denied, 520 U.S. 1155 (1997); Chavero v.
Local 241, Div. of Amalgamated Transit Union, 787 F.2d 1154, 1157 (7th Cir. 1986)
(holding that union executive board members are not "employees" for purposes of Title
VII jurisdiction because directors are employers rather than employees unless they
perform traditional employee duties). Title VII cases also frequently address whether
the worker at issue is an employee of the defendant or an independent contractor. See,
e.g., Schwieger v. Farm Bureau Ins. Co., 207 F.3d 480, 484-87 (8th Cir. 2000)
(determining whether insurance sales agent was employee or independent contractor
for purposes of Title VII jurisdiction); Birchem v. Knights of Columbus, 116 F.3d 310,
312-13 (8th Cir. 1997) (performing independent contractor analysis in ADA context,
analogous to Title VII inquiry). While these cases do not directly address the type of
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relationship at issue here, we look to the factors examined in these cases to further
identify indicia of an employment relationship between UFCW and its stewards.
We first consider the nature of the working relationship between the parties,
particularly the union's right to control the manner and means by which the stewards
accomplish their tasks. See Schwieger, 207 F.3d at 483. "The actual duties and role
of the individual govern the resolution of the [employment] issue." Devine v. Stone,
Leyton & Gershman, P.C., 100 F.3d 78, 81 (8th Cir. 1996), cert. denied, 520 U.S. 1211(1997). Although there is little evidence in the record detailing the day-to-day
relationship between the stewards and UFCW, the District Court credited evidence that
the union had, "for many years, treated the union stewards as employees." Daggitt, 59
F. Supp. 2d at 984. The court also noted that the union president possessed authority
to replace stewards and to fill steward vacancies between elections. Through the union
president's power to replace stewards and to fill steward vacancies, the union can exert
control over the manner in which the stewards represent the union in dealings with
fellow union members and the employer. Such control over the termination and hiring
of stewards is enough, in these circumstances, to find that the union had a measure of
control over the manner and means by which the stewards performed their duties.
Next, we consider the application of the multiple factors frequently used to
analyze whether an individual is an employee or an independent contractor.
Nationwide Mut. Ins. Co. v. Darden, 503 U.S. 318, 323-24 (1992) (examining twelve
indicators of traditional agency relationship). These factors include the skill required,
source of the tools used, location of the work accomplished, duration of the parties'
relationship, right to assign additional projects, the putative employee's discretion over
where and how long to work, the method of payment, the putative employee's role in
hiring and paying assistants, whether the hired party's work is performed in the regular
business of the hiring party, the business the hiring party is in, provision of employee
benefits, and the tax treatment of the hired party. Not every factor discussed in Darden
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applies to the steward-union relationship. We consider only those for which the record
contains relevant evidence.
Applying the relevant factors, we find that several characteristics of the
relationship between UFCW and its stewards point to a conclusion that the shop
stewards are employees of the union for Title VII purposes. The length of the UFCW-
steward relationship is neither brief nor insubstantial. UFCW stewards generally serve
three-year terms. Also, stewards perform acts within the regular business of the union
by representing the interests of other union members in those members' employment.
This representation seeks to protect the rights won by the union through the collective
bargaining process on a day-to-day, on-the-job basis, which undoubtedly furthers the
union's mission. Evidence in the record suggests that the stewards are directed in their
duties by UFCW's business agents, who in turn report to the union's executive board.
Such supervision lends further weight to the view that the stewards are properly
characterized as employees of the union for purposes of subject-matter jurisdiction over
Title VII claims against the union qua employer.
Relying upon the District Court's findings, we agree that ordinary definitions of
employer and employee, as well as ordinary principles of agency, establish the
existence of an employer-employee relationship between the union and its stewards
sufficient to require that the stewards be counted toward Title VII's fifteen-employee
jurisdictional requirement. Furthermore, by employing the "payroll test," as the District
Court correctly did, we find that the District Court properly determined that UFCW
"had" fifteen employees for the requisite time period to establish jurisdiction over
Daggitt's sexual harassment claim. See Walters v. Metro. Educ. Enters., Inc., 519 U.S.
202, 211 (1997) (holding that payroll test should be used when calculating whether an
employer "has" an employee under Title VII; test requires that an employee be counted
"for each working day", not just for each day actually worked). Therefore, we affirm
the District Court's determination that it had subject-matter jurisdiction over Daggitt's
Title VII claims against the union as Daggitt's employer. Because Daggitt's sexual
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harassment claim was properly submitted to the jury under theories charging the union
with liability both as a labor organization and as an employer, we affirm the jury's
general verdict in favor of Daggitt on this claim.
IV.
UFCW next argues that the District Court abused its discretion by enhancing the
plaintiff's attorney fees award by twenty-five percent above the lodestar figure. The
prevailing party in an action for unlawful employment practices may recover "a
reasonable attorney's fee (including expert fees) as part of the costs" awarded to that
party. 42 U.S.C. § 2000e-5(k). The District Court awarded Daggitt the lodestar
amount plus a twenty-five percent enhancement, bringing the total amount of the fee
to $33,547.13. Given the complexity of the case and the modest nature of the lodestar
figure, we believe this fee award was entirely reasonable. Upon careful review of the
record and the arguments submitted, we hold that the District Court did not abuse its
discretion when it awarded the enhancement. See Forshee v. Waterloo Indus., Inc.,
178 F.3d 527, 532 (8th Cir. 1999) (standard of review). We therefore affirm the fee
award to Daggitt.
V.
In sum, we hold that the union stewards of UFCW are "employees" of the union
for purposes of establishing jurisdiction over the union under 42 U.S.C. § 2000e(b).
Because Daggitt's sexual harassment claim was properly submitted to the jury on her
employee-of-the-union theory as well as her union-membership theory, and because
UFCW raises no challenge to the sufficiency of the evidence on either theory, we affirm
the judgment of the District Court. The award of attorney fees is also affirmed.
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A true copy.
Attest:
CLERK, U.S. COURT OF APPEALS, EIGHTH CIRCUIT.
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