Cohen v. SUPA INC.

• Decision Date: 24 February 1993
• Docket Number: No. 90-CV-1284.,90-CV-1284.
• Parties: Stanley D. COHEN, Plaintiff, v. S.U.P.A. INC., d/b/a/ Mail Boxes Etc. U.S.A., Wine Merchants of Syracuse, Ltd., Marshall M. Reisman, and Daniel S. Reisman, Defendants.
• Court: U.S. District Court — Northern District of New York

814 F. Supp. 251

Stanley D. COHEN, Plaintiff, v. S.U.P.A. INC., d/b/a/ Mail Boxes Etc. U.S.A., Wine Merchants of Syracuse, Ltd., Marshall M. Reisman, and Daniel S. Reisman, Defendants.

No. 90-CV-1284.

United States District Court, N.D. New York.

February 24, 1993.

Hiscock & Barclay, Syracuse, NY (Richard K. Hughes and Rhonda B. Kublin, of counsel), for plaintiff.

Walter D. Kogut, P.C., Syracuse, NY, for defendants.

MEMORANDUM-DECISION and ORDER

HURD, United States Magistrate Judge.

Presently before this court is defendants' motion for summary judgment pursuant to Fed.R.Civ.P. 56, on the ground that there exists no genuine issues of fact necessitating trial. Plaintiff opposes such motion. Oral argument was heard on the motion on January 14, 1993. For the following reasons, defendants' motion is denied.

On June 30, 1992, plaintiff filed an amended complaint alleging that the defendants' decision to terminate him from their employment was because of his age in violation of the Age Discrimination in Employment Act of 1967, as amended ("ADEA"), 29 U.S.C. §§ 621, et seq., the Fair Labor Standards Act of 1938, as amended ("FLSA"), 29 U.S.C. §§ 201, et seq., and the Human Rights Law of the State of New York ("NYSHRL"), N.Y.Exec.Law §§ 290, et seq. In their answer, defendants allege that plaintiff was laid off from employment for good cause, including but not limited to, his unsatisfactory job performance. In addition, defendants allege that S.U.P.A., Inc., is not an employer subject to the ADEA, and that plaintiff has failed to satisfy all the jurisdictional prerequisites to bringing suit in federal court.

FACTS

The plaintiff, Stanley Cohen, was employed by Wine Merchants of Syracuse, Ltd., a wholesale liquor distributor, as a salesman for 22 years. He retired from Wine Merchants in 1987 at the age of 60.¹ Approximately one year after his retirement, Marshall Reisman ("M. Reisman"), owner of Wine Merchants, contacted plaintiff to inquire whether he would be interested in acquiring an interest in a new business that he was about to begin, called Mail Boxes, Etc. ("Mail Boxes"), a retail store that provides mail and shipping services to the public. Although he declined the offer, he did accept a part-time position at Mail Boxes. Plaintiff, however, wished only to work a maximum of 25 hours per week, so that his yearly income did not exceed the social security income restriction of $6,480.00. Plaintiff began working at the Fayetteville, New York, store in November 1988, at a wage of $5.00 per hour with no additional benefits. At the time, plaintiff was receiving extended health insurance benefits through his previous employment with Wine Merchants. However, in February 1989, plaintiff's health benefits expired.

After plaintiff was notified that he would no longer receive health benefits, he contacted M. Reisman to see if there was any way that Wine Merchants could continue his health coverage. Plaintiff claims that Reisman agreed to extend his eligibility for benefits until age 65.

Sometime in March 1989, plaintiff spoke with Daniel Reisman ("D. Reisman") about his concerns that he was working too many hours, and that he could exceed the social security income restriction by the end of the year. D. Reisman suggested that plaintiff take some time off during the months of August, September, or October when the store was not busy. On or about April 26, 1989, plaintiff claims that he was permanently terminated from his job beginning May 18, 1989, and that two college students were hired in his place.² Approximately three weeks after his layoff, on or about June 7, 1989, plaintiff filed charges with the New York State Division of Human Rights ("NYSDHR") and the Equal Employment Opportunity Commission ("EEOC"), alleging unlawful termination because of his age, in violation of the NYSHRL and the ADEA.³

Defendants claim that they did not terminate plaintiff from his employment, and that it was plaintiff who requested to take some time off in order that his income would not exceed the social security restriction.⁴ Defendants state that they decided the best time for plaintiff to take some time off was the summer months when help would be available from the son and daughter of two Vice Presidents at Wine Merchants. Plaintiff was then notified that he would be laid off from May 18, 1989, through the summer months, and that he would be called back in the fall.

Plaintiff also claims that three months after he filed his June 1989, complaint with the NYSDHR, the defendants unlawfully terminated his health benefits through Wine Merchants in retaliation for filing his complaint, despite representations from M. Reisman that Wine Merchants would continue to cover his health benefits until age 65. Therefore, on October 4, 1989, he filed a second complaint with NYSDHR alleging that defendants violated the NYSHRL, and Title VII of the Civil Rights Act of 1964.⁵

In September 1989, plaintiff was offered re-employment through the holiday season at Wine Merchants, but denied the offer since it was not substantially equivalent to his previous position and he was afraid of retaliation.⁶ Defendants claim that plaintiff denied the offer of employment because he had been advised not to take the job; yet he told New York State Division of Unemployment that he was unwilling to accept full-time employment. Further, after Wine Merchants told him the job was part-time, he again declined to take the job, claiming that his doctor informed him not to lift anything and he was advised not to work for M. Reisman.

I. IS MAIL BOXES, AN "EMPLOYER" WITHIN THE MEANING OF THE ADEA?

As a preliminary issue, this court must decide whether S.U.P.A. Inc., d/b/a Mail Boxes ("S.U.P.A./Mail Boxes") is an "employer" within the meaning of the ADEA.⁷ If the answer is no, then the court need not address any other issue and will dismiss plaintiff's complaint for lack of subject matter jurisdiction.

The ADEA defines an employer as "a person engaged in an industry affecting commerce who has twenty or more employees for each working day in each of twenty or more calendar weeks in the current or preceding calendar year." 29 U.S.C. § 630(b). Although S.U.P.A./Mail Boxes employs twenty or more persons over a twenty or more week period, most of those employees are part-time employees. The question then becomes whether part-time employees who do not work on each day of the week are defined as "employees" within the meaning of the ADEA. If part-time employees are counted for the purposes of the jurisdictional requirement, then S.U.P.A./Mail Boxes is subject to the provisions of the ADEA. Affidavit of Verne A. Lannier, Exhibit "S".

In support of his contention, plaintiff cites to EEOC Policy Statement No. 915-052 (April 20, 1990) ("Policy Statement"), agreeing with the First and Fifth Circuits, which states that the proper determination "is to count the number of employees maintained on the payroll in any given week rather than the number of employees who report to work on any given day." Defendants, however, cite Zimmerman v. North American Signal Company, 704 F.2d 347 (7th Cir.1983), in which the Seventh Circuit upheld the district court's conclusion that part-time hourly employees on the days they do not work, are not counted in determining the jurisdictional requirement of the ADEA.⁸ Yet, the EEOC disagrees with Zimmerman.⁹ The EEOC expressly agrees with the logic of Gorman v. North Pittsburgh Oral Surgery Assoc., Ltd., 664 F.Supp. 212, 213 (W.D.Pa.1987), which states that under the Zimmerman approach "a business that operates almost entirely with part-time labor could escape the prohibitions of the ADEA, despite the number of workers actually employed." Policy Statement, at 6.¹⁰

Surprisingly, the courts in the Second Circuit have left this question unanswered. Defendants cite Amato v. Western Union Int'l, Inc., 773 F.2d 1402 (2d Cir.1985), cert. dismissed, 474 U.S. 1113, 106 S.Ct. 1167, 89 L.Ed.2d 288, in support of their contention that the Second Circuit agrees with Zimmerman. However, a close reading of Amato, leaves the defendants without Circuit support. Amato involved a claim under the Employee Retirement Income Security Act, where there was not even any question that the plaintiffs were employees of the defendant. In fact, Zimmerman was cited by the Amato court for the proposition that "courts should not construe a statute in a way that makes words or phrases meaningless, redundant, or superfluous."

Defendants also cite Weber v. George Cook, Ltd., 563 F.Supp. 598 (S.D.N.Y.1983), in support of their proposition that courts in this Circuit have adopted the Zimmerman approach. The Weber court, however, cited Zimmerman's holding, that there was a distinction between part-time employees paid by the hour and those who were paid a salary, because the defendant sought to exclude plaintiff from the definition of "employee" on that basis. In the end, the Weber court did not decide whether Zimmerman accurately interpreted the ADEA because it found that the plaintiff received a partial salary, and therefore, was included as an employee within in the meaning of the ADEA.

Defendants also argue that "the statute requires that twenty employees be present for at least twenty weeks during one of the relevant years," Weber, 563 F.Supp. at 600 (emphasis added), in support of their contention that part-time employees are not present at the store on each day for twenty weeks. Although it is entirely true that employees must be present at the store, the Weber court was faced with employees who were independent contractors (i.e., sales representatives) stationed across the country. In fact, these sales representatives had their own offices; declared themselves as self-employed for tax purposes; kept their own business records; and operated with a great deal, if not complete, autonomy. Id. at 600-601. The Weber court was concerned with the fact that these "employees" did not...