In Moraetis v. Evans, 2017 NY Slip Op 03451 (App. Div. 1st Dept. May 2, 2017), the court discussed the application of the “single employer” doctrine to plaintiff’s discrimination claims under the New York State and City Human Rights Laws, and the use of independent contractors to meet the four-person threshold under the City Law.
From the decision:
The [lower] court erred in determining that issues of fact exist regarding whether, under the single employer doctrine, the employees of Spring Hill Farm should be counted toward the four-person threshold necessary to state a claim under the New York State and New York City Human Rights Laws. Under that doctrine, liability for certain violations of employment law may be imposed on entities that are a part of a “single enterprise”. The doctrine has been limited to situations where the plaintiff’s employer is a wholly-owned subsidiary, or where the plaintiff’s employment is subcontracted by one employer to another … entity[.]
Here, neither situation exists, as plaintiff’s employer, Edward P. Evans Foundation (the Foundation) was a parent corporation that temporarily owned and controlled its subsidiary, Spring Hill Farm. Further, plaintiff does not allege that Spring Hill Farm made any discriminatory employment decisions, or any decisions at all in connection with her employment. Accordingly, there is no issue of fact as to whether Spring Hill Farm, which employs six full-time employees, and the Foundation, which employs only two full-time employees, can be considered part of a single “employer” for the purposes of satisfying the minimum four-person-in-the-employ requirement set forth in the New York State and New York City Human Rights Law (Executive Law §§ 292; 296; Administrative Code of City of NY §§ 8-102; 8-107).
Nevertheless, issues of fact remain whether plaintiff has stated a claim under the New York City Human Rights Law on the basis that three members of the Foundation’s Scientific Advisory Board were paid by the Foundation and worked for the Foundation, and thus can be considered independent contractors and/or employees of the Foundation for the purposes of satisfying the four-person threshold. This theory does not apply to the claim under the State Human Rights Law, which, unlike the City law, does not provide that independent contractors count towards the four-person threshold.