Regional Air Carriers are “Joint Employers” Under FMLA

Darrell VanDeusen
Darrell VanDeusen

The Seventh Circuit has held that two air carriers that supplied regional air service for United Airlines are joint employers for purposes of the Family and Medical Leave Act (FMLA). Cuff v. Trans States Holdings, Inc., 2014 U.S.App. LEXIS 18901 (7th Cir. September 19, 2014). In so doing, the court held that an employee who was on the Trans States payroll was covered by the FMLA.

United contracts with firms for regional air service as “United Express.” Trans States Holdings (Holdings) is is one of those suppliers, and it owns two air carriers: Trans States Air-lines (Trans States) and GoJet Airlines (GoJet). Cuff worked at O’Hare Airport as a Trans States employee and was fired in January 2010 when he took leave even after his FMLA request was denied. At the time, Trans States had 33 employees at or within 75 miles of O’Hare; GoJet had 343 employees; Holdings had no employees.

The FMLA applies only if an employer has at least 50 employees within 75 miles of a given location. 29 U.S.C. § 2611(2)(B)(ii). Thus, if Cuff worked only for Trans States, he could not avail himself to the FMLA’s protections. On the other hand, if Trans States and GoJet were coupled together under the Holdings label, there were more than enough employees to warrant FMLA coverage.

The district court granted summary judgment for Cuff, holding that he worked for the two airlines jointly. The Seventh Circuit agreed, relying on DOL regulations: 29 C.F.R. § 825.106(a), which says that workers are covered by the FMLA when they are jointly employed by multiple firms that collectively have 50 or more workers, and 29 C.F.R. § 825.104(c), which provides that two or more firms may be treated as a single employer when they operate a joint business.

The court noted that the joint-employment inquiry under Section 825.106(a) is person-specific: it is possible for one person to be employed jointly by two firms that otherwise have distinct labor forces. And the regulation supplies a list of factors to consider, “all relevant, none dispositive.”

Relying on its decision in Moldenhauer v. Tazewell-Pekin Consol. Commun. Ctr., 536 F.3d 640, 644 (7th Cir. 2008), the court noted “that open-ended lists do not decide concrete cases. Often a set of factors to be considered and balanced implies the need for a trial, but summary judgment is possible when the facts allow. Cf. Secretary of Labor v. Lauritzen, 835 F.2d 1529 (7th Cir. 1987).” The two main factors identified by the regulation are (1) whether “there is an arrangement between employers to share an employee’s services” and (2) whether “one employer acts directly or indirectly in the interest of the other employer in relation to the employee.”

Cuff’s title was “regional manager” of Trans States, but he represented the three entities in their dealings with United and O’Hare. Cuff’s business card had all three firms’ logos on it. In deposition, the Vice President for Customer Services at Holdings testified that Cuff was hired to provide services to both Trans States and GoJet. And, noted the court, the internal directories of Holdings and United Express identified Cuff as the person to contact with any question about how Trans States or GoJet operated at O’Hare.

The court stressed that Cuff’s supervisor told United and other airlines that Cuff “will be your go to person if there are any operational issues or concerns with Trans States or GoJet Airlines flights operating in and out of your cities.” Cuff testified that he worked with Trans States and GoJet every day. His replacement was put on the payroll of Holdings because, the company explained, “We made the decision to put the support positions that support both [Trans States and GoJet] where we can into a Holdings position.”

Based on this record, the court held that the answer to both questions in Cuff’s case was “yes,” and that none of the remaining factors helped the defendants. Cuff was a joint employee of at least Trans States and GoJet, if not of Holdings too. He should have been permitted to use leave because he was protected under the FMLA.




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