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Third Circuit holds that Company Shareholder-Director is not an "Employee" under Title VII

Posted Thursday, May 2, 2013 4:37 pm

The United States Court of Appeals for the Third Circuit recently held that a plaintiff who worked at and was a shareholder-director of a closely held family business could not proceed on a Title VII claim of religious discrimination against the business.

 

As one of the lumberyard's founders, the plaintiff worked as Vice President and Secretary, served as a member of the Board of Directors, and was a shareholder. He alleged that he had a "spiritual awakening" in 1995 and suffered systematic antagonism about his religious affiliation that ultimately led to his ouster from the company in 2009. In concluding that he could not proceed on a Title VII claim, the Third Circuit reasoned that the plaintiff had significant authority and the right to control the enterprise because his roles as board member and corporate officer enabled him to participate in the management, development and governance of the organization and have a say in fundamental decisions of the company. As such, the protections provided by Title VII simply did not apply to the plaintiff. Read more.

 

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