Diggs v. Harris HospitalMethodist, Inc., HOSPITAL-METHODIS

• Decision Date: 21 June 1988
• Docket Number: HOSPITAL-METHODIS,No. 87-1631,INC,87-1631
• Parties: 47 Fair Empl.Prac.Cas. 138, 46 Empl. Prac. Dec. P 38,068, 57 USLW 2042 Dr. Jacqulyn DIGGS, Plaintiff-Appellant, v. HARRIS, Defendant-Appellee.
• Court: U.S. Court of Appeals — Fifth Circuit

Page 270

847 F.2d 270

47 Fair Empl.Prac.Cas. 138,

46 Empl. Prac. Dec. P 38,068, 57 USLW 2042

Dr. Jacqulyn DIGGS, Plaintiff-Appellant, v. HARRIS HOSPITAL-METHODIST, INC., Defendant-Appellee.

No. 87-1631.

United States Court of Appeals, Fifth Circuit.

June 21, 1988.

LaNelle L. McNamara, McNamara & McNamara, Waco, Tex., for plaintiff-appellant.

William M. Schur, Tom B. Renfro, Wynn, Brown, Mack, Renfro & Thompson, Fort Worth, Tex., for defendant-appellee.

Appeal from the United States District Court for the Northern District of Texas.

Before REAVLEY, GARWOOD and DAVIS, Circuit Judges.

REAVLEY, Circuit Judge:

Jacqulyn Diggs, a black, female physician, brought a Title VII action against the private, non-profit hospital that terminated her staff privileges. Following a bench trial, the district court denied Diggs all relief, ruling against her both on the ground that she lacked the capacity to bring suit under Title VII because she was not an employee of the defendant hospital, and on the merits. Because we find that Diggs failed to prove the existence of an employment relationship with which the hospital allegedly interfered, we affirm.

I. Facts and Proceeding Below

Diggs received her M.D. degree from the University of Texas at Galveston in 1977, and completed a residency in obstetrics and gynecology at John Peter Smith Hospital, Fort Worth, Texas in 1981. She is licensed to practice medicine in Texas.

In July 1981, Diggs applied for staff privileges at Harris Hospital-Methodist, Inc. ("Harris Hospital") in Fort Worth. Staff privileges permit a physician to admit her private patients to the hospital for medical treatment and to utilize the facilities and personnel of the hospital in caring for her patients. At Harris Hospital, physicians who have staff privileges are designated as appointed to the medical staff of the hospital. Diggs was initially appointed to the temporary medical staff at Harris Hospital, and in September 1981 she was appointed to the provisional medical staff.

Diggs retained her provisional status for the ensuing three years, during which time the hospital repeatedly considered termination of her privileges due to her failure to comply with the requirement of sponsor-observation imposed on provisional staff members, and concerns over several instances of perceived case mismanagement by Diggs. Following several warnings, hearings, and reviews, the hospital terminated Diggs's staff privileges on August 28, 1984.

One year later, in August 1985, Diggs brought this suit under Title VII of the Civil Rights Act of 1964, 42 U.S.C. Sec. 2000e et seq. The action alleged discriminatory acts by Harris Hospital on the basis of race, sex, and/or in retaliation for a prior charge of discrimination. The district court entered judgment in July 1987 against Diggs, who now appeals.

II. Discussion

Congress enacted Title VII of the Civil Rights Act of 1964 to ensure equality of employment opportunities by eliminating those practices and devices that discriminate on the basis of race, color, religion, sex, or national origin. Kremer v. Chemical Constr. Corp., 456 U.S. 461, 468, 102 S.Ct. 1883, 1890-91, 72 L.Ed.2d 262 (1982). Specifically, the Act provides in part that:

(a) It shall be an unlawful employment practice for an employer--

(1) to fail or refuse to hire or to discharge any individual, or otherwise to discriminate against any individual with respect to his compensation, terms, conditions, or privileges of employment, because of such individual's race, color, religion, sex, or national origin;

42 U.S.C. Sec. 2000e-2(a)(1) (emphasis added).

Our court has previously held that a Title VII claim must necessarily involve an employment relationship. Broussard v. L.H. Bossier, Inc., 789 F.2d 1158, 1159 (5th Cir.1986). Further, it is well-settled in this circuit that we determine whether a plaintiff was an "employee" for Title VII purposes by applying the hybrid economic realities/common law control test first advanced in Spirides v. Reinhardt, 613 F.2d 826, 831 (D.C.Cir.1979). See Broussard, 789 F.2d at 1160; ¹ Mares v. Marsh, 777 F.2d 1066, 1067 (5th Cir.1985). This circuit has not resolved the question of whether a person can bring a Title VII action against an employer ² who has interfered with that person's employment opportunities with a third party.

Diggs advances two alternate theories of Title VII coverage: (1) that she was an employee of Harris Hospital, and (2) that Title VII encompasses interference by an employer with a person's access to the employment market.

A. The Relationship Between Diggs and Harris Hospital

If an employee-employer relationship existed between plaintiff Diggs and defendant Harris Hospital, undoubtedly Diggs has standing to bring a claim under Title VII. Harris Hospital does not dispute that it is an employer as defined by Title VII. The question here, then, is whether Diggs's relationship with Harris Hospital was one of employee or independent contractor. While the parties agree that the economic realities/common law control test of Spirides is the appropriate standard, they disagree on the result of its application to the facts of this case. Harris Hospital argues that Diggs was an independent contractor, while Diggs contends that she was an employee.

We agree with the district court that Diggs was not an employee of Harris Hospital for purposes of Title VII. The economic realities/common law control test considers the economic realities of the work relationship, ³ and the extent to which the one for whom the work is being done has the right to control the details and means by which the work is to be performed, with emphasis on this latter control factor. Mares, 777 F.2d at 1067. Additionally, courts are to consider the following factors in determining whether an employee-employer relationship exists for Title VII purposes:

(1) the kind of occupation, with reference to whether the work usually is done under the direction of a supervisor or is done by a specialist without supervision; (2) the skill required in the particular occupation; (3) whether the "employer" or the individual in question furnishes the equipment used and the place of work; (4) the length of time during which the individual has worked; (5) the method of payment, whether by time or by the job; (6) the manner in which the work relationship is terminated; i.e., by one or both parties, with or without notice and explanation; (7) whether annual leave is afforded; (8) whether the work is an integral part of the business of the "employer;" (9) whether the worker accumulates retirement benefits; (10) whether the "employer" pays social security taxes; and (11) the intention of the parties.

Broussard, 789 F.2d at 1160 (quoting Spirides, 613 F.2d at 832).

As a matter of economic reality, Diggs, as an obstetrician-gynecologist, is dependent upon having hospital staff privileges in order to pursue her medical practice. There was no evidence submitted at trial, however, that privileges at Harris Hospital were necessary to her practice or that denial of staff privileges at Harris Hospital hampered her ability to obtain staff privileges at any other Fort Worth hospital. Furthermore, in determining her working relationship with the hospital, we are to focus more on the control factor. Mares, 777 F.2d at 1067. While the hospital supplies the tools, staff and equipment utilized by Diggs in delivering medical care at the hospital, and while it imposes standards upon those permitted to hold staff privileges, the hospital does not direct the manner or means by which Diggs renders medical care. Diggs is under no duty to admit any of her patients to Harris Hospital, and Harris Hospital does not pay her for her services.

Diggs treated her patients in Harris Hospital without direct supervision. As a provisional staff member she was required to have a sponsor present during surgical procedures, but the purpose of that requirement was to have someone to attest to her essential qualifications, not to direct the details of the exercise of her skill. The hospital does not provide salary or wages to physicians with staff privileges, nor does it pay their licensing fees, professional dues, insurances, taxes, or retirement benefits. Diggs had staff privileges at several other Fort Worth area hospitals during the time she was on Harris Hospital's provisional staff.

B. Interference with Diggs's Employment Opportunities

Diggs also contends that even if her relationship with Harris Hospital was not one of employment, the alleged discrimination falls within the scope of Title VII because Harris Hospital's actions interfered with her employment opportunities. We reject the argument for the reason that even if we were to hold that Harris Hospital could violate the provisions of Title VII by interfering with Diggs's relationship with a third party--a question we do not reach that relationship would have to be an employment relationship under the economic realities/common law contract control test discussed above. The employment opportunities to which Diggs points were her potential treatment arrangements with private patients. Diggs was not employed, nor...