No. 10-1621 _________________________________ IN THE UNITED STATES COURT OF APPEALS FOR THE NINTH CIRCUIT __________________________________ EQUAL EMPLOYMENT OPPORTUNITY COMMISSION, Plaintiff-Appellant, v. CLARK COUNTY, NEVADA, Defendant-Appellee. ____________________________________ On Appeal from the United States District Court for the District of Nevada Hon. James C. Mahan, Judge ____________________________________ BRIEF OF THE EQUAL EMPLOYMENT OPPORTUNITY COMMISSION AS APPELLANT P. DAVID LOPEZ GAIL S. COLEMAN General Counsel Attorney EQUAL EMPLOYMENT LORRAINE C. DAVIS OPPORTUNITY COMMISSION Acting Associate General Counsel Office of General Counsel 131 M Street, NE, Room 5SW24L CAROLYN L. WHEELER Washington, DC 20507 Assistant General Counsel (202) 663-4055 gail.coleman@eeoc.gov STATEMENT REGARDING ORAL ARGUMENT The EEOC requests oral argument to address any questions the Court may have about when and why volunteers may sometimes be considered employees protected by the Age Discrimination in Employment Act ("ADEA"), 29 U.S.C. § 621 et seq. TABLE OF CONTENTS Statement Regarding Oral Argument . . . . . . . . . . . . . . . . . . i Table of Authorities . . . . . . . . . . . . . . . . . . . . . . . . .iii Statement of Jurisdiction . . . . . . . . . . . . . . . . . . . . . . . 1 Statement of the Issue . . . . . . . . . . . . . . . . . . . . . . . . 1 Statement of the Case . . . . . . . . . . . . . . . . . . . . . . . . . 1 A. Course of Proceedings . . . . . . . . . . . . . . . . . . . . 1 B. Statement of Facts . . . . . . . . . . . . . . . . . . . . . . 2 C. District Court's Decision . . . . . . . . . . . . . . . . . . 5 Summary of Argument . . . . . . . . . . . . . . . . . . . . . . . . . . 5 Argument . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .6 A reasonable jury could find that Clark County's volunteer firefighters are "employees" protected by the Age Discrimination in Employment Act because they receive significant economic benefits in exchange for their service . . . . . . . . . . . . . . . . . . . . . 6 A. Standard of Review . . . . . . . . . . . . . . . . . . . . . . 6 B. Discussion . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Conclusion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .11 Statement of Related Cases Certificate of Service TABLE OF AUTHORITIES Cases Clackamas Gastroenterology Assocs., P.C. v. Wells, 538 U.S. 440 (2003) . . . . . . . . . . . . . . . . . . . . . . . . . . .7 EEOC v. UPS Supply Chain Solutions, 620 F.3d 1103 (9th Cir. 2010) . . . . . . . . . . . . . . . . . . . . . . 6 Daggitt v. United Food & Comm. Workers Int'l Union, Local 304A, 245 F.3d 981 (8th Cir. 2001) . . . . . . . . . . . . . . . . . . . . . .6-8 Fichman v. Media Ctr., 512 F.3d 1157 (9th Cir. 2008) . . . . . . . . .7, 10 Haavistola v. Cmty. Fire Co. of Rising Sun, 6 F.3d 211 (4th Cir. 1993) . . . . . . . . . . . . . . . . . . . . . . . .8 Mark H. v. Hamamoto, 620 F.3d 1090 (9th Cir. 2010) . . . . . . . . . . . .6 Nationwide Mut. Ins. Co. v. Darden, 503 U.S. 318 (1992) . . . . . . . . . 7 O'Connor v. Davis, 126 F.3d 112 (2d Cir. 1997) 9 Pietras v. Bd. of Fire Comm'rs, 180 F.3d 468 (2d Cir. 1999) . . . . . 8, 10 Smith v. Castaways Family Diner, 453 F.3d 971 (7th Cir. 2006) . . . . . . 7 U.S. v. City of New York, 359 F.3d 83 (2d Cir. 2004) 10 Statutes and Rules Age Discrimination in Employment Act, 29 U.S.C. § 623 . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 29 U.S.C. § 626(b) . . . . . . . . . . . . . . . . . . . . . . . . . . 1 Fair Labor Standards Act of 1938, 29 U.S.C. § 216(c) . . . . . . . . . . . . . . . . . . . . . . . . . . .1 29 U.S.C. § 217 . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 Fed. R. App. P. 4(a)(1)(B) . . . . . . . . . . . . . . . . . . . . . . .1 Nev. Rev. Stat. § 616A.145 (2010) . . . . . . . . . . . . . . . . . 4, 11 Nev. Rev. Stat. § 617.457(2) (2007) . . . . . . . . . . . . . . . 2, 4, 9 Nev. Rev. Stat. § 617.457(2) (as amended July 1, 2009) . . . . . . . .2-3 28 U.S.C. § 1291 . . . . . . . . . . . . . . . . . . . . . . .1 28 U.S.C. § 1331 . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 28 U.S.C. § 1345 . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 Other Authorities Section 2, Threshold Issues, EEOC Compl. Man. 2-III(A)(1)(c) (2009), http://www.eeoc.gov/policy/docs/threshold.html#2-III-A-1-c, reprinted at 2009 WL 2966744 (Aug. 6, 2009) . . . . . . . . . . .8-9 Restatement (Second) of Conflict of Laws § 184 comment b (1971) . . . . 11 STATEMENT OF JURISDICTION The district court had jurisdiction over this Age Discrimination in Employment Act ("ADEA") case under 28 U.S.C. §§ 1331, 1345 and 29 U.S.C. § 626(b), which incorporates by reference sections 16(c) and 17 of the Fair Labor Standards Act of 1938 as amended, 29 U.S.C. §§ 216(c), 217. On March 15, 2010, the district court granted summary judgment to Clark County. (R.97, Hearing Tr. at 35 (R.E. at 28)) The district court entered final judgment on March 30, 2010. (R.100, Judgment (R.E. at 3)) Pursuant to Rule (4)(a)(1)(B) of the Federal Rules of Appellate Procedure, the EEOC filed a timely notice of appeal on May 27, 2010. (R.111, Notice of Appeal (R.E. at 1)) This Court has jurisdiction under 28 U.S.C. § 1291. STATEMENT OF THE ISSUE Can Clark County's volunteer firefighters qualify as "employees" under the Age Discrimination in Employment Act because they receive valuable economic benefits in exchange for their service? STATEMENT OF THE CASE A. Course of Proceedings The EEOC filed this ADEA action against Clark County and two codefendants on September 27, 2007. (R.1, Complaint (R.E. at 56)) The district court dismissed one codefendant on February 21, 2008. (R.34, Minute Entry (R.E. at 71)) Clark County and the remaining codefendant moved for summary judgment on December 18, 2009. (R.72 & R.78, Motions for Sum. J. (R.E. at 69, 70)) On March 15, 2010, the district court granted their motions. (R.97, Hearing Tr. at 35 (R.E. at 28)) The district court entered final judgment on March 30, 2010. (R.100, Judgment (R.E. at 3)) The EEOC filed a timely notice of appeal on May 27, 2010 (R.111, Notice of Appeal (R.E. at 1)) and voluntarily moved to dismiss the codefendants on April 13, 2011, and April 22, 2011. (9C R.21 & R.22, Motions (R.E. at 64)) This Court granted the motions to dismiss on June 7, 2011. (9C R.25, Order (R.E. at 65)) This brief addresses the EEOC's continuing appeal against Clark County. B. Statement of Facts This litigation stems from a now-repealed provision of Nevada law authorizing the payment of workers' compensation to volunteer firefighters who experience heart disease in connection with the performance of their firefighting duties if and only if the would-be recipient of benefits has not reached age 55 before the onset of disease. Nev. Rev. Stat. § 617.457(2) (2007). After the EEOC commenced this age discrimination litigation, Nevada amended its law to permit the award of workers' compensation to volunteer firefighters regardless of age. Nev. Rev. Stat. § 617.457(2) (as amended July 1, 2009). The amendment was not retroactive. This lawsuit seeks to compensate three volunteer firefighters who became ill and were denied workers' compensation before July 2009. (R.1, Complaint at 2 (R.E. at 57); R.97, Hearing Tr. at 18 (R.E. at 22)) Because the ADEA protects "employees" and not volunteers, 29 U.S.C. § 623, a threshold issue in this case is whether Clark County's volunteer firefighters can be considered employees even though they are unpaid. The evidence shows that Clark County has 765 paid firefighters and 250 volunteer firefighters. (R.81-9, Smith Dep. at 19 (R.E. at 32)) Thirteen rural stations are staffed exclusively with volunteers. (R.81-9, Smith Dep. at 17 (R.E. at 31)) Some of these volunteers are local residents who work as paid firefighters elsewhere. (R.78-3, Vannozzi Dep. Vol. 2 at 148 (R.E. at 48)) Paid and volunteer firefighters perform the same duties and often work side-by-side at the same fires. (R.78-2, Vannozzi Dep. Vol. 1 at 70 (R.E. at 50); R.81-8, McClintock Dep. at 18-20 (R.E. at 38-40); R.81-9, Smith Dep. at 32 (R.E. at 33)) Depending on who arrives at the scene first, volunteers may supervise professionals or the other way around. (R.81-8, McClintock Dep. at 19 (R.E. at 39)) Although they are not paid, volunteer firefighters do receive some benefits. Clark County provides them with free biannual physical exams to guarantee that they are fit for duty. (R.87-3, Vannozzi Dep. Vol. 2 at 165 (R.E. at 49); R.76-9, Dunt Dep. at 17 (R.E. at 51); R.78-6, Ayers Dep. at 14 (R.E. at 44)) In certain circumstances, they are eligible for workers' compensation, Nev. Rev. Stat. § 617.457(2), which Nevada calculates based on a "deemed wage" of $2,000 per month. Nev. Rev. Stat. § 616A.145. Additionally, if volunteers are killed in the line of duty, the Nevada State Firefighters Association provides scholarships so that their children may attend any state university for free. (R.81-12, Heidemann Dep. at 27 (R.E. at 30); R.81-9, Smith Dep. at 34 (R.E. at 34)) Volunteers who are killed in the line of duty are eligible for federal benefits. (R.81-9, Smith Dep. at 35 (R.E. at 35)) Finally, Clark County publicly recognizes volunteers for their service during employee recognition ceremonies. (Id. at 35-36 (R.E. at 35- 36)) However, volunteer firefighters receive fewer benefits than paid firefighters. Volunteers must use their own funds to purchase departmental badges, name tags, and clothing with the fire department's insignia. (R.78- 4, Schneiderman Dep. at 26, 28-29 (R.E. at 45-46)) They pay for EMT (emergency medical treatment) training on their own. (R.78-3, Vannozzi Dep. Vol. 2 at 118 (R.E. at 47)) They also pay for membership in the Nevada State Firefighters Association. (R.81-8, McClintock Dep. at 10 (R.E. at 37)) They receive training that parallels the training which paid firefighters receive, but the trainings are separate from the professional trainings and, except for EMT training, are non-mandatory (albeit strongly encouraged). (Id. at 20, 39-41 (R.E. at 40-43)) C. District Court's Decision The district court granted summary judgment to Clark County on the ground that volunteer firefighters are not covered "employees" under the ADEA. The court stated, "I think it comes down to the fact that the . . . volunteer firefighters are not employees. . . . [U]npaid volunteers are not employees within the protection of [the ADEA]." (R.97, Hearing Transcript at 3, 4 (R.E. at 8, 9)) SUMMARY OF ARGUMENT While it is true that Clark County's volunteer firefighters do not receive a salary, they do receive significant economic benefits in exchange for their service. Some of these benefits become available only upon their injury or death, but the promise of benefits distinguishes the firefighters from ordinary volunteers. Because the firefighters receive benefits of real economic value, a jury could conclude that they qualify as "employees" entitled to the protection of the Age Discrimination in Employment Act ("ADEA"). This conclusion would be consistent with the ADEA's purpose of eliminating age discrimination in the workplace as a barrier to economic opportunities. ARGUMENT A reasonable jury could find that Clark County's volunteer firefighters are "employees" protected by the Age Discrimination in Employment Act because they receive significant economic benefits in exchange for their service. A. Standard of Review This Court reviews an award of summary judgment de novo, viewing the evidence in the light most favorable to the non-moving party. EEOC v. UPS Supply Chain Solutions, 620 F.3d 1103, 1110 (9th Cir. 2010). Summary judgment is appropriate only if there are no genuine issues of material fact and if the moving party is "clearly entitled to judgment as a matter of law." Mark H. v. Hamamoto, 620 F.3d 1090, 1096-97 (9th Cir. 2010). B. Discussion The ADEA prohibits employers from discriminating against their employees on the basis of age. In deciding whether workers qualify as "employees" within the meaning of this statute, courts first must consider whether they are compensated for their services. Daggitt v. United Food & Comm. Workers Int'l Union, Local 304A, 245 F.3d 981, 987 (8th Cir. 2001) ("Compensation is an 'essential condition to the existence of an employer- employee relationship.' Without compensation, no combination of other factors will suffice to establish the relationship.") (citation omitted). If workers receive some form of compensation, no matter how small, courts may also consider a series of additional factors concerning the employment relationship. See id. at 988 (union reimbursement to stewards for lost-time pay and union dues "is . . . a form of compensation for performing a service for the union," permitting court to examine other aspects of the union/steward relationship); cf. Clackamas Gastroenterology Assocs., P.C. v. Wells, 538 U.S. 440, 448 (2003) (in deciding whether shareholder is employee or owner - a situation where compensation is not questioned -- courts must consider various factors but "the common-law element of control is the principal guidepost that should be followed"); Nationwide Mut. Ins. Co. v. Darden, 503 U.S. 318, 324 (1992) (in deciding whether worker is employee or independent contractor - a situation where compensation is not questioned -- court must weigh "'all of the incidents of the relationship'") (citation omitted).<1> Courts have recognized that compensation does not always take the form of wages. Daggitt, 245 F.3d at 987 (lost-time pay, contributions to 401(k) plan, reimbursement of dues constitute compensation); Pietras v. Bd. of Fire Comm'rs, 180 F.3d 468, 471, 473 (2d Cir. 1999) (retirement pension, life insurance, death benefits, disability insurance, and some medical benefits constitute compensation); Haavistola v. Cmty. Fire Co. of Rising Sun, 6 F.3d 211, 221-22 (4th Cir. 1993) (whether disability pension, survivors' benefits, group life insurance, and workers' compensation constitute compensation is a question of fact). When benefits are valuable enough, their loss implicates the same policy concern that animates the federal antidiscrimination laws: Discrimination should not limit economic opportunities. This rationale only applies, of course, when benefits are substantial. As the EEOC has explained, volunteers qualify as employees for purposes of the federal antidiscrimination statutes when their benefits "constitute 'significant remuneration' rather than merely the 'inconsequential incidents of an otherwise gratuitous relationship.'" Section 2, Threshold Issues, EEOC Compl. Man. 2-III(A)(1)(c) (2009), http://www.eeoc.gov/policy/docs/threshold.html#2-III-A-1-c, reprinted at 2009 WL 2966744 (Aug. 6, 2009) (quoting Haavistola, 6 F.3d at 222). The types of benefits that Clark County's volunteer firefighters receive are precisely the same type that the EEOC has said are sufficient to confer employee status. "An individual may be considered an employee of a particular entity," the EEOC has explained, "if, as a result of volunteer service, s/he receives benefits such as a pension, group life insurance, workers' compensation, and access to professional certification, even if the benefits are provided by a third party." Id. Clark County's volunteer firefighters receive free medical exams, workers' compensation, the promise of a free college education for their children if they are killed in the line of duty, and federal benefits if they are killed in the line of duty. (Nev Rev. Stat. § 617.457(2); R.78-3, Vannozzi Dep. Vol. 2 at 165 (R.E. at 49); R.76-9, Dunt Dep. at 17 (R.E. at 51); R.78- 6, Ayers Dep. at 14 (R.E. at 44); R.81-12, Heidemann Dep. at 27 (R.E. at 30); R.81-9, Smith Dep. at 34-35 (R.E. at 34-35)) These benefits have real economic value, even though most of them become available only upon a volunteer's injury or death. See O'Connor v. Davis, 126 F.3d 112, 116 (2d Cir. 1997) (in determining whether volunteer may qualify as an "employee," court should consider existence of "direct or indirect economic remuneration or the promise thereof") (emphasis added); see also U.S. v. City of New York, 359 F.3d 83, 92 n.3 (2d Cir. 2004) ("workers['] compensation is a significant benefit to the worker and particularly to the worker who may not be able to establish negligence"). In light of these important benefits, the employment status of Clark County's volunteer firefighters can be resolved only by considering all aspects of the County/firefighter relationship. See Fichman, 512 F.3d at 1160 (enumerating some factors relevant to employment status); see also Pietras, 180 F.3d at 473 ("non-salaried volunteer firefighter's employment status . . . is a fact question when that firefighter is entitled to significant benefits"). A reasonable jury would consider that Clark County's volunteer firefighters perform the same duties as paid firefighters and often work side- by-side with them. (R.78-2, Vannozzi Dep.Vol. 1 at 70 (R.E. at 50); R.81-8, McClintock Dep. at 18-20 (R.E. at 38-40); R.81-9, Smith Dep. at 32 (R.E. at 33)) A jury would also consider that, depending on who arrives at the scene first, volunteers may supervise professionals or the other way around. (R.81-8, McClintock Dep. at 19 (R.E. at 39)) Finally, a jury would note that to the extent volunteer firefighters are eligible for workers' compensation, this employee benefit is just as valuable to employers as it is to injured workers. See Restatement (Second) of Conflict of Laws § 184 comment b (1971) (one purpose of workers' compensation is "to place some restrictions upon the cost of industrial accidents"). A jury would consider that Nevada "deems" the firefighters to be receiving a salary of $2,000 per month for purposes of workers' compensation precisely because that benefit is only available to employees and not to volunteers. Nev. Rev. Stat. § 616A.145. Taken together, these factors could lead a reasonable jury to conclude that Clark County's volunteer firefighters qualify as employees under the ADEA. The district court erred by not even considering these indicia of employment. CONCLUSION The record evidence shows that Clark County's volunteer firefighters receive significant economic benefits in exchange for their service. Under these circumstances, a reasonable jury could find that they qualify as employees entitled to the protection of the ADEA. The district court erred by resolving this question on summary judgment. For the foregoing reasons, the EEOC respectfully asks this Court to reverse the award of summary judgment and remand for the factfinder to determine whether Clark County's volunteer firefighters are covered by the ADEA. Respectfully submitted, P. DAVID LOPEZ General Counsel LORRAINE C. DAVIS Acting Associate General Counsel CAROLYN L. WHEELER Assistant General Counsel /s/ Gail S. Coleman _____________________________________ GAIL S. COLEMAN Attorney EQUAL EMPLOYMENT OPPORTUNITY COMMISSION Office of General Counsel 131 M Street, NE, Room 5SW24L Washington, DC 20507 (202) 663-4055 gail.coleman@eeoc.gov STATEMENT OF RELATED CASES Pursuant to Rule 28-2.6 of the Ninth Circuit Rules, I hereby state that the EEOC is unaware of any related cases pending in this Court. /s/ Gail S. Coleman _____________________________________ GAIL S. COLEMAN Attorney EQUAL EMPLOYMENT OPPORTUNITY COMMISSION Office of General Counsel 131 M Street, NE, Room 5SW24L Washington, DC 20507 (202) 663-4055 gail.coleman@eeoc.gov CERTIFICATE OF SERVICE I, Gail S. Coleman, hereby certify that I filed the foregoing brief electronically in PDF format with the Court via the ECF system on this 20th day of July, 2011. I further certify that I served the foregoing brief electronically in PDF format through the ECF system this 20th day of July, 2011, to all counsel of record. /s/ Gail S. Coleman _____________________________________ GAIL S. COLEMAN Attorney EQUAL EMPLOYMENT OPPORTUNITY COMMISSION Office of General Counsel 131 M Street, NE, Room 5SW24L Washington, DC 20507 (202) 663-4055 gail.coleman@eeoc.gov ********************************************************************************** <> <1> In Fichman v. Media Center, 512 F.3d 1157 (9th Cir. 2008), this Court used the Clackamas multi-factor test to determine whether members of a Board of Directors were volunteers or employees. Id. at 1160. The Court does not appear to have considered that the lack of compensation in Fichman might have distinguished the case from Clackamas sufficiently to render the multi- factor analysis unnecessary. Cf. Smith v. Castaways Family Diner, 453 F.3d 971, 978 (7th Cir. 2006) ("the purpose of the Clackamas test is to distinguish 'employers' from 'employees'"; the test is not relevant when the individual in question has no ownership interest in the business).