Palmer v. International Ass'n of MacHinists & Aerospace Workers

882 S.W.2d 117, 1994 Ky. LEXIS 54, 1994 WL 221812
CourtKentucky Supreme Court
DecidedMay 26, 1994
Docket93-SC-359-DG
StatusPublished
Cited by42 cases

This text of 882 S.W.2d 117 (Palmer v. International Ass'n of MacHinists & Aerospace Workers) is published on Counsel Stack Legal Research, covering Kentucky Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Palmer v. International Ass'n of MacHinists & Aerospace Workers, 882 S.W.2d 117, 1994 Ky. LEXIS 54, 1994 WL 221812 (Ky. 1994).

Opinions

WINTERSHEIMER, Justice.

This appeal is from a decision of the Court of Appeals which affirmed a summary judgment of the circuit court holding that none of the appellees met the jurisdictional requirement of eight or more employees in twenty calendar weeks so as to be defined as an “employer” pursuant to KRS 344.030(2).

The principal issue is whether the summary judgment on the charge of unlawful discrimination was proper because none of the defendants qualify as an employer as defined by statute. The other issue is whether summary judgment was proper on the charge of unlawful retaliation because Palmer has not stated a cause of action so as to be able to recover damages for unlawful retaliation.

Palmer brought a discrimination suit pursuant to KRS Chapter 344, the Kentucky Civil Rights Act, and claimed that she was fired from her job as a secretary at the IAM District Lodge because she was female and because she filed a discrimination suit against the union. She claimed her existing position of secretary was abolished and she was laid off. The question is whether the IAM District Lodge was her employer, or whether she was an employee of a conglomerate made up of six local unions which comprised the district and international union of which the district and local unions are a part.

Palmer was employed as a secretary in District Lodge 27 of the IAM from 1964 until her termination in 1990. She was turned down for a position as a full time organizer in 1989, and filed a complaint alleging discrimination on the basis of sex in violation of KRS 344.040. Subsequently, she was dismissed from her secretarial position. In 1991, she filed suit against IAM District Lodge 27, and six local unions in District 27. She also named as defendants the directing business representative and the president of the district lodge alleging that they had conspired in violation of KRS 344.280(1) to retaliate against • her for filing the discrimination charge by intentionally negotiating a collec-[119]*119five bargaining agreement which provided no minimum work hours for her position and then terminating her.

The circuit court entered summary judgment dismissing her complaint and the Court of Appeals affirmed. This Court granted discretionary review because statutory construction issues of first impression are involved.

The Court of Appeals properly sustained the decision of the circuit court to grant summary judgment against Palmer on the charge of unlawful discrimination because none of the defendants qualify as an employer pursuant to the definition provided in KRS 344.030(2). At the time of her complaint, the statute was numbered KRS 344-030(1). The statute limits the term “employer” to those persons who have at least eight employees within the State of Kentucky during each of the twenty or more calendar weeks during either the same year as the alleged unlawful discrimination or during the preceding year. Palmer sought to have all the defendants considered together as a single employer for the purpose of satisfying the statutory definition.

There are no Kentucky cases that directly define the term “employer” provided in the statute. KRS Chapter 344 was modeled after the Federal statute in Title VII of the Civil Rights Act of 1964, codified in 42 U.S.C. § 2000(e)(b). Several Federal jurisdictions have been faced with the same issue, that is, whether a parent company or union may be joined together with other entities or subsidiaries to meet the minimum number of employees required to constitute an employer under the statute. The Federal cases apply four factors which are: 1) interrelation of operations, 2) common management, 3) centralized control of labor relations, and 4) common ownership or financial control. Baker v. Stuart Broadcasting Co., 560 F.2d 389 (8th Cir.1977); Evans v. McDonald’s Corp., 936 F.2d 1087 (10th Cir.1991).

A review of the cases indicates that the determination of what constitutes an employer is on a case-by-case basis and that the four factors noted above are applied to reach a solution. The appellees here do not necessarily fit into either category, but after applying the four-pronged test, we agree with the Court of Appeals that the IAM, its district lodges and its local lodges are not one employer as contemplated by KRS 344.040(1) and 344.030(1). The single employer principle applies only where separate entities are organized or operate in such a way that they are not actually separate.

In this case, the operations of the IAM, the district lodges and the local lodges are distinct. Each unit separately conducts its daily operations and finances. There is a separate treasury for each local union and each unit is required to file separate employee and tax forms with the appropriate federal revenue department. Each entity also has its own facilities and operations. The management of each union is fundamentally different. Although the IAM has some control over its district and local lodges, can exercise authority in emergency situations, and in some instances has final approval over certain matters, the employees and officers are different and control the day-to-day operations of the local management.

Evans v. McDonald’s Corp., supra, indicates that although McDonald’s could control many aspects of the operation, it is not unusual for a franchise to be subject to those types of control. ■ That alone was not sufficient to consider McDonald’s, together with the franchisee as the plaintiffs employer.

The district and local lodges also have distinct powers over labor relations even though the IAM has final authority over strikes and some other related matters. The district and local lodges can hire and fire their own employees and the IAM constitution allows the district lodges to set up the minimum wage scale in their localities. The IAM constitution specifically states that each district or local lodge shall establish a sufficient number of business representatives so that servicing can be accomplished with a minimum of IAM assistance. The local and district lodges issue the paychecks to their own employees and Palmer testified that she worked for District Lodge 27 and not the IAM. She stated that she did not receive a paycheck from IAM.

[120]*120Financial control of each union is also separate, although the district and local lodges did receive part of their annual funding from the IAM, the bulk of their funds came from other sources. Their bank accounts were maintained separately. Their own official kept their own books, conducted separate audits and made sure that the district or local lodge was complying with all federal and state regulations.

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Bluebook (online)
882 S.W.2d 117, 1994 Ky. LEXIS 54, 1994 WL 221812, Counsel Stack Legal Research, https://law.counselstack.com/opinion/palmer-v-international-assn-of-machinists-aerospace-workers-ky-1994.