Employment Discrimination and Mediation

By Michael J. Gelfand, Esq. / Published November 2023

EMPLOYMENT DISCRIMINATION: IS YOUR ASSOCIATION THE EMPLOYER?

     Sometimes it is not clear which company is the employer when one company leases an employee to another company or when a company hires a temporary worker. Does this sound familiar, especially when an association contracts for services, and the company hired has workers who are not “traditional” full-time hires?

     The relationship between the worker and the others in the employment chain becomes crucial if the employee files an employment discrimination lawsuit. Which company controls the conditions of employment?

     In a recent employment discrimination case that may impact Florida community associations, a Florida appellate court overturned a trial court ruling that a defendant company was not an employer of a leased employee. The facts in Libardi v. Pavimento, Inc., 48 Fla. L. Weekly D 1156 (Fla. 2nd DCA, June 9, 2023), show that Encore, a professional employer organization, assigned Libardi to work at Pavimento. Libardi sustained a disabling injury from a car accident resulting in the loss of her leg.

     When Libardi returned to work at Pavimento, she was temporarily using a wheelchair. A day or two after her return, Pavimento terminated Libardi’s employment. Libardi sued Pavimento and the employee leasing company, Encore, for discrimination, retaliation, and harassment under the Americans with Disabilities Act and the Florida Civil Rights Act.

     The trial court granted final summary judgment to Encore, dispensing with a trial and instead finding that Encore could not be liable for employment discrimination because Encore was not an employer of Libardi. The court based its decision on the grounds that Encore’s only involvement with Libardi’s employment was as the signer of payroll checks.

     The Florida appellate court in reversing the decision of the trial court pointed out that in order to determine which company is the employer of the employee in employment discrimination cases, the trial court must examine whether an employer “retains sufficient control over the terms and conditions of employment of the other company’s employees.”

     The appellate court noted that the evidence showed that when Libardi began working at Pavimento, she signed a document in which she acknowledged that she was an employee of Encore, and that Encore could terminate her employment at any time. Additionally, the document provided that Encore could drug test Libardi after any job-related injury. Furthermore, the owner of Pavimento testified that all his company’s employees were leased from Encore.

     “As can be seen, the circuit court’s express basis for granting summary judgment to Encore was directly contrary to substantial evidence in the record,” the court stated. “That evidence created an issue of fact regarding the extent to which Encore controlled the conditions of Libardi’s employment such that it was her employer for purposes of her discrimination claims.”

     This issue can come up for Florida associations who may hire temporary employees, as well as for associations that contract with companies that lease employees. To help protect yourself from employment discrimination cases, it is important to consider what control the association would have over the conditions of employment. For this reason, many associations stay clear of direct hiring, firing, and discipline of contractors’ employees. For any questions, contact your association’s counsel.

CONTRACTS: IF IT SAYS YOU HAVE TO MEDIATE, YOU HAVE TO MEDIATE

     What happens when your contract states the parties “shall attempt” to settle a dispute through mediation? Is that just a suggestion to go to mediation? No, if it says you shall mediate, then you must mediate before filing a lawsuit.

     In Meeks v. Strickland, 48 Fla. L. Weekly D 1163 (Fla. 6th DCA, June 9, 2023), Meeks sued the Stricklands over nonpayment of a promissory note arising from a real estate transaction. The contract provided the following:

Buyer and Seller shall attempt to settle Disputes in an amicable manner through mediation…. injunctive relief may be sought without first complying with this Paragraph 16(b). Disputes not settled pursuant to this Paragraph 16 may be resolved by instituting action in the appropriate court having jurisdiction of the matter.

     The trial court granted summary judgment for the defendants and awarded the defendants attorney’s fees under Section 57.105, Fla. Stat. (2021) but deferred setting the amount until later.

     The Florida appellate court disagreed with the trial court, finding that the plaintiff’s motion for summary judgment was premature because mediation had not occurred. The court explained that the contract, which was “clear and unambiguous in its terms,” required mediation to take place before litigation. Additionally, the court found that the appeal from the portion of the judgment granting attorney’s fees was also premature.

     This case shows how important it is to know what your contracts say, both before signing and then when you anticipate a dispute. If you have a contract that requires certain steps before a lawsuit can be filed, you need to know what the steps are and discuss them with counsel!

Michael J. Gelfand, Esq.

Senior Partner, Gelfand & Arpe, P.A.

Michael J. Gelfand, Esq., the senior partner of Gelfand & Arpe, P.A., emphasizes a community association law practice, counseling associations and owners how to set legitimate goals and effectively achieve those goals. Gelfand is a dual Florida Bar board-certified lawyer in condominium and planned development law and in real estate law, a certified circuit and county civil court mediator, a homeowners’ association mediator, an arbitrator, and parliamentarian. He is a past chair of the Real Property Division of the Florida Bar’s Real Property, Probate & Trust Law Section, and a Fellow of the American College of Real Estate Lawyers. Contact him at ga@gelfandarpe.com or 561-655-6224.