Stephane Moreau v. Air France Joseph P. Bouloux Howard Weisser v. United States of America, Intervenor-Appellee
Docket: 02-15872
Court: Court of Appeals for the Ninth Circuit; September 15, 2003; Federal Appellate Court
The case involves Stephane Moreau appealing a summary judgment from the U.S. District Court for the Northern District of California, which concluded that Air France was not a "joint employer" of contracted service workers for the purposes of the Family Medical Leave Act (FMLA) and the California Family Rights Act (CFRA). Moreau, employed by Air France as an Assistant Station Manager at San Francisco International Airport, requested a twelve-week leave to assist his ill father, claiming entitlement under FMLA and CFRA. His request was denied by Joseph Bouloux, after which Howard Weisser sent a letter stating that Air France employed fewer than 50 employees at the relevant worksite, thus exempting it from FMLA requirements. The letter also noted that taking leave could result in termination. Following his unauthorized leave, Moreau was terminated and subsequently filed suit, alleging violations of FMLA and CFRA, along with various state law claims. The district court ruled in favor of Air France, finding it did not qualify as a joint employer and granting summary judgment on Moreau's claims, including wrongful discharge and breach of employment contract. Moreau's appeal is subject to de novo review for both the summary judgment and the joint employer determination.
Joint employment under the Family and Medical Leave Act (FMLA) is guided by statutory and regulatory frameworks aimed at balancing workplace demands with family needs. Eligible employees are entitled to up to twelve weeks of unpaid leave for specific family-related reasons, although the FMLA exempts employers with fewer than 50 employees from coverage. A "small operations" exception further excludes employees at worksites with fewer than 50 employees within a 75-mile radius, acknowledging the challenges of reassigning workers across distances.
While the FMLA does not explicitly define joint employment, administrative regulations outline criteria for its determination. Joint employment may exist when multiple businesses exert control over an employee’s work conditions or if the employee benefits multiple employers simultaneously. Key indicators include arrangements for shared services, one employer acting in the interest of another, and a lack of complete disassociation between employers regarding the employee’s employment.
Evaluations of joint employment consider the overall relationship rather than applying a single criterion. For instance, joint employment commonly arises when a temporary agency supplies workers to another employer. The regulations differentiate between "primary" and "secondary" employers, with the primary employer responsible for employee notifications, FMLA leave, and health benefits. Factors determining the primary employer include hiring authority, payroll responsibilities, and benefit provision. If joint employment is established, both employers must count the jointly employed employees for coverage and eligibility determinations, regardless of payroll status.
No cases have been reported in this circuit concerning joint employment under the Family and Medical Leave Act (FMLA). However, relevant cases exist under the Fair Labor Standards Act (FLSA) and the Migrant and Seasonal Agricultural Worker Protection Act (AWPA). The FMLA incorporates definitions from the FLSA, and its joint employer regulation parallels the FLSA's language.
In Bonnette v. California Health and Welfare Agency, the court identified four critical factors for determining joint employment under the FLSA: (1) the power to hire and fire employees, (2) supervision and control over employee work schedules or payment conditions, (3) determination of pay rates and methods, and (4) maintenance of employment records. California welfare agencies were found to be joint employers of chore workers due to their complete economic control over the employment relationship.
In Torres-Lopez v. May, the court applied a broader evaluation of joint employment under the AWPA, considering factors such as the nature and degree of control over workers, supervision levels, authority over pay rates, hiring and firing rights, and payroll preparation. The grower’s extensive oversight and financial investment in labor and equipment contributed to the determination of joint employment, emphasizing the need to assess all relevant factors in each specific context.
Key factors for determining joint employer status include: (1) whether the work was specialized; (2) if responsibility between labor contractors transfers without significant changes; (3) the use of the employer's premises and equipment; (4) the ability of employees to shift as a group between worksites; (5) whether the work was piecework lacking initiative; (6) the opportunity for profit or loss based on managerial skill; (7) the permanence of the employment relationship; and (8) whether the service is integral to the employer's business. In Torres-Lopez, the grower was deemed a joint employer due to significant control over farmworkers, who were economically dependent on the grower.
In Zhao v. Bebe Stores, the court applied the Bonnette and Torres-Lopez tests and concluded Bebe was not a joint employer, despite some favorable factors for plaintiffs. The court noted Apex owned its facility, controlled hiring and working conditions, and was not economically reliant on Bebe. It distinguished the case from Torres-Lopez, emphasizing Apex's independence and the nature of control over workers.
Moreau argues Air France should be considered a joint employer of employees from Dynair/Swissport, which provided ground handling services at SFO. Dynair, which serviced multiple carriers and did not exclusively service Air France, charged based on aircraft type and incurred additional costs if flights were delayed beyond a certain grace period. This arrangement was necessary for Dynair to manage scheduling effectively across various clients.
Dynair owned all its equipment except for luggage pallets and determined the staffing needs for flights. Most services were provided on the tarmac, with Dynair employees spending about 30 minutes daily on Air France aircraft. Air France had no authority over Dynair's employment decisions or benefits for its workers. Air France specified cleaning procedures and monitored the cleaning and loading processes, requiring at least one "C2" certified Dynair employee for baggage loading, with training sometimes provided by Air France.
Air France contracted Ogden (later SkyChefs) for catering services, providing menus and passenger information. Ogden owned its kitchen equipment, prepared most food, and loaded it onto Air France trays, while Air France supplied certain specialty items. Ogden employees spent about 45 minutes on Air France aircraft, with the rest of their time at Ogden facilities or in transit, and serviced multiple carriers simultaneously. Payment to Ogden was based on meal quantity and services rendered, independent of employee hours.
An Air France employee monitored catering quality from an office in the Ogden kitchen, conducting checks and addressing food quality issues at monthly meetings. Air France had no control over Ogden's workforce management beyond meal timing. The relationship with Ogden ended in 2000, with no change in employee numbers noted post-termination.
Air France also contracted Aeroground for cargo handling, with payments based on cargo volume rather than employee hours. Aeroground dedicated specific employees to Air France but retained the flexibility to reassign them to other clients, as long as minimum staffing levels were maintained. These dedicated employees represented a small portion of Aeroground’s workforce at the San Francisco location.
Air France required a minimum number of "cross-utilized" warehouse employees, who worked on multiple accounts, including its own. If Aeroground needed to provide more employees than those specified in the contract, it had to do so without additional compensation. Aeroground was responsible for supplying all necessary cargo handling equipment and its own facilities. They managed all aspects of employee relations, including hiring and discipline, while Air France provided some training related to its systems and safety regulations. Aeroground experienced significant employee turnover and had three supervisory changes during its contract with Air France.
Marc Richard, an Air France employee, acted as the Cargo Operations Manager at the Aeroground facility, focusing on service quality rather than direct employee supervision. He clarified that while he checked on service quality, he did not oversee employee schedules or attendance, which was the responsibility of Aeroground's supervisors.
The legal application section compares Air France to the Torres-Lopez farm owners and Aeroground to labor contractors, arguing that the district court misapplied the four-factor Bonnette test instead of the broader Torres-Lopez considerations. It was contended that the Bonnette test is too restrictive for determining joint employer status under the FMLA. However, even when applying the Torres-Lopez test, the overall circumstances indicated that Air France should not be classified as a joint employer. Key factors from the Bonnette analysis showed that Air France did not have hiring or firing authority, did not set employee pay or maintain employment records, and did not control employee schedules or working conditions.
Air France did not possess authority to control the workers directly but communicated performance complaints to the service company's supervisors. Moreau argued that Air France's specific instructions, such as detailed cleaning checklists and baggage load sheets, indicated control; however, he failed to establish a direct correlation between these instructions and control over the service provider's employees or their working conditions. It would be imprudent for a company to contract services without providing guidance on those services. Air France did ensure its standards were met through indirect supervision, primarily to comply with safety and security regulations, such as proper food storage and balanced loads. The court referenced Zhao, asserting that ensuring compliance does not equate to employee control.
Further analysis of non-regulatory factors from Torres-Lopez indicated that Air France was not a joint employer. Service contracts were specific and non-transferable, and service work occurred mainly on the ground handling companies' premises or airport tarmac, with minimal interaction with Air France aircraft. The ground companies invested heavily in equipment, contrasting with the farmworker scenario where the grower provided substantial resources. While Air France supplied some equipment, it was minimal compared to that owned by the ground handling companies. Additionally, ground handling employees had the flexibility to work for multiple carriers and were often unionized, distinguishing their situation from that of farmworkers.
The skill level of workers varied significantly by job, with master chefs requiring more expertise than baggage handlers, though both roles necessitated specialized training. Ground company employees had opportunities for promotion based on managerial skills, unlike farm laborers. The duration of employment relationships also varied; some chefs worked long-term with Air France, while warehouse staff frequently changed. The relevance of whether the work was integral to Air France's business is questioned, particularly for roles like food service or cargo transport, suggesting they may not be essential to the airline's operations. Even accepting that these services are vital, the overall assessment does not support a joint employer relationship due to the weight of opposing factors.
Further considerations, as per FMLA regulations, were analyzed but did not change the outcome. Shared premises with ground handling companies were noted, with specifics differing by company. Dynair subleased from Air France at a standard rate, indicating no special economic dependence. Ogden provided a small office to Air France at no cost, a customary practice for its clients, with costs covered by service charges. Aeroground also offered office space free of charge, part of a negotiated contract without separate fees. Lastly, Moreau highlighted Air France's reimbursement to Dynair for overtime, but the flat-rate payment structure and lack of control over employee pay by Air France suggest that Dynair's economic dependence on Air France is not substantiated.
The district court's analysis of the Bonnette factors was deemed somewhat limited; however, it was concluded that Air France is not a joint employer of the ground handling service company employees. Consequently, the court affirmed the summary judgment in favor of Air France on Moreau's claims under the Family and Medical Leave Act (FMLA) and the California Family Rights Act (CFRA).
Regarding Moreau's common law claims, he argued that his termination violated California public policy, which is primarily reflected in the CFRA and FMLA. The court noted that California law does not provide a common law remedy for those not covered under the pertinent statutes, thereby supporting the conclusion that Moreau, not being an eligible employee under the FMLA, has no state law public policy claim.
Moreau also claimed that Air France breached an implied-in-fact contract that stipulated termination could only occur for cause, rather than at-will. California courts consider multiple factors in determining the intention behind at-will employment. While Moreau's nearly eleven-year tenure, merit raises, and promotions were noted, these alone do not create a triable issue without explicit employer communication negating at-will status. The Air France employee handbook contained a clear at-will disclaimer, which is significant but not conclusive. It outlined disciplinary procedures and a probationary period allowing for immediate termination without following these procedures.
Contrary to the district court's findings, the case presents a potential triable issue regarding an implied-in-fact contract for termination based on good cause, as established in Guz v. Bechtel National, Inc. The presence of formal personnel policies may imply that the employer intended employees to rely on these terms as part of their employment conditions.
The court affirmed the summary judgment granted to Air France regarding Moreau's claims. Moreau needed to demonstrate an implied contract for "for cause" termination and that Air France breached this contract. The employee handbook stipulated that "insubordination" and "absences without justification" constituted sufficient grounds for immediate dismissal, and unexcused absences were excluded from the progressive discipline system. Air France successfully argued that Moreau's failure to return to work and acts of insubordination fell under these grounds, thus no breach occurred.
Moreau's claim for breach of the implied covenant of good faith and fair dealing was also rejected. The court noted that this covenant does not extend the rights of the parties beyond the terms of their agreement. Since Air France did not breach the implied agreement, summary judgment on this claim was warranted.
Additionally, the district court determined that Air France should not be classified as a joint employer under the Family and Medical Leave Act (FMLA) concerning the ground handling employees, which justified the summary judgment on Moreau's state law claims for violation of the California Family Rights Act (CFRA) and wrongful termination. Despite potential issues regarding the at-will nature of Moreau's employment raised by the handbook, his unexcused absence justified Air France's immediate termination. Thus, the court upheld the summary judgment on the breach of contract claim.
The ruling was affirmed, with additional notes regarding the similarities between CFRA and FMLA and references to relevant case law on joint employment.
A Dynair manager received a free flight to France, but Dynair employees did not regularly receive the flight benefits enjoyed by Air France employees. There were 50-70 Aeroground warehouse workers servicing Air France at SFO. While Air France scheduled flights, individual companies were responsible for designating employees for aircraft service. The relationship between Dynair and Air France was not unique, as a similar arrangement existed with Aeroground and Asiana Airlines. Moreau's claim of unresolved factual issues regarding employee numbers was rejected; Air France's payroll records, authenticated by a custodian, indicated a maximum of 42 employees at the time of Moreau's leave request. Eligibility for FMLA benefits is assessed based on the number of employees when leave is requested, not when it is taken. The district court granted summary judgment on FMLA, CFRA, and state law claims, leaving unresolved whether the Federal Sovereign Immunities Act prevents a jury trial against U.S. citizen defendants or if the court had personal jurisdiction over defendant Howard Weisser. The motions to strike unsupported statements and requests for judicial notice were denied as moot.
