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The Requirement of Employee Status

§ 10.02.01
Key point 10-02.01. Employers may be liable on the basis of respondeat superior only for the acts of employees.

Churches can be liable on the basis of respondeat superior for the negligent acts of employees committed within the course or scope of their employment. A number of courts have addressed the question of whether clergy are "employees" for purposes of imposing liability on an employing church. One of the first such cases was a decision by the Supreme Court of California.[28] Malloy v. Fong, 232 P.2d 241 (Cal. 1951). The case involved a 12-year-old boy who lost a leg and suffered serious injuries to his other leg because of an accident caused by the reckless driving of the pastor of a Presbyterian "missions" church. At the time of the accident, the boy was standing on the "running board" of a car driven by the church's pastor at an excessive rate of speed (he was "racing" a car driven by a seminary student). The boy's family sued the pastor individually, as well as the presbytery of San Francisco (the presbytery overseeing the local missions church). The court was asked to determine whether an ecclesiastical body could be sued on account of the negligence of one of its ministers acting in the course of his employment.

Noting that there was "no compelling reason" why a religious organization should not be liable for the negligence of its employees, the court proceeded to determine whether a minister could be characterized as an employee. In reaching its decision that a minister could be deemed an employee, the court relied on well-established criteria employed by the courts in determining the status of other workers:

Whether a person performing work for another is an employee or self-employed depends primarily upon whether the one for whom the work is done has the legal right to control the activities of the alleged employee. The power of the employer to terminate the services of the employee gives him the means of controlling the employee's activities. "The right to immediately discharge involves the right of control." It is not essential that the right of control be exercised or that there be active supervision of the work of the employee. The existence of the right of control and supervision establishes the existence of an employment relationship.[29] 232 P.2d at 249 (citations omitted). The terms employer and employee have been used instead of principal and agent.

The court also found that a minister could be deemed a church employee under the criteria set forth in the Restatement of Agency (an authoritative legal treatise):

  1. An employee is a person employed to perform service for another in his affairs and who, with respect to his physical conduct in the performance of the service, is subject to the other's control or right to control.
  2. In determining whether one acting for another is an employee or self-employed, the following matters of fact, among others, are considered:
the extent of control which, by the agreement, the employer may exercise over the details of the work; whether or not the one employed is engaged in a distinct occupation or business; the kind of occupation, with reference to whether, in the locality, the work is usually done under the direction of the employer or by a specialist without supervision; the skill required in the particular occupation; whether the employer or the workman supplies the instrumentalities, tools, and the place of work for the person doing the work; the length of time for which the person is employed; the method of payment, whether by the time or by the job; whether or not the work is a part of the regular business of the employer; and whether or not the parties believe they are creating the relationship of employer and employee.[30] Restatement of Agency § 220 (1933). The terms employer and employee have been used instead of the terms principal and agent. Compare the current Restatement (Second) of Agency § 220 (1958) which is identical to the quoted provision except that it adds a further factor: "(j) whether the [employer] is or is not in business."

In concluding that the negligent pastor was an agent of the presbytery (and not an independent contractor), the court noted the following two additional considerations. First, the presbytery exercised significant control over "missions" churches (it held title to all church property, assisted with the churches' finance, and paid a portion of clergy salaries). Second, the presbytery had the authority to approve or disapprove a missions church's selection of its pastor. Following the installation of such a pastor, "he was not responsible to the local church but only to the presbytery. The presbytery, not the church, had the power to remove him. Furthermore, he could not transfer to another pastorate without permission of the presbytery, and in fact he was a member of the presbytery rather than of the local church."

The court concluded: "The existence of the right of control and supervision establishes the existence of an agency relationship [making the employer legally responsible for the acts of an employee committed within the scope of his or her employment]. The evidence clearly supports the conclusion of the jury that such control existed in the present case. The right of the presbytery to install and remove its ministers, to approve or disapprove their transfer to other jurisdictions, and to supervise and control the activities of the local churches, particularly those in the mission stage, is inconsistent with a contrary conclusion." The court emphasized that "we are not here called upon to determine the liability of the presbytery for negligence in the activities of a fully established and independently incorporated Presbyterian church which has passed from the mission stage." Clearly, the Malloy case would not support liability of the presbytery for the activities of clergy serving such churches, since there would be none of the control by the presbytery over the activities of the local church that in Malloy was deemed sufficient to establish an agency relationship between the presbytery and a pastor of a missions church.

Key point. Cases addressing the correct reporting status (employee or self-employed) of ministers for income tax reporting purposes are relevant, though not controlling, in deciding whether or not a minister is an employee whose negligence is imputed to his or her employing church under the doctrine of respondeat superior. [31] For a complete discussion of the reporting status of ministers for income tax reporting purposes, see R. Hammar, CHURCH AND CLERGY TAX GUIDE, chapter 2 (published annually by the publisher of this text).

The principle of respondeat superior imposes liability upon churches for injuries caused by the negligence of employees. Some courts have extended this doctrine to cover injuries caused by the negligence of uncompensated volunteers. However, a church generally is not responsible for the misconduct of independent contractors. Independent contractors are persons who offer their services to the public and are generally engaged to do some particular project, usually for a specified sum, and who perform the task with little or no supervision or control. They are not considered to be employees.[32] See generally R. Hammar. CHURCH AND CLERGY TAX GUIDE, chapter 2 (published annually by the publisher of this text).

In summary, under the doctrine of respondeat superior a church can be liable for the negligent acts of employees committed within the scope or course of their employment. Are clergy "employees" of their church for purposes of this doctrine? If so, their negligent acts committed within the scope of their employment may be imputed to their employing church. What about nonminister church workers? Cases addressing the employee status of both clergy and nonminister workers are summarized in the following examples.

Case Studies

Clergy

  • A church was sued for injuries and damages caused by the reckless driving of its pastor. The injured victim alleged that the pastor was an employee of his church, and thus the employer-church was vicariously liable for the consequences of the pastor's negligence committed in the course of employment. The church denied liability on the ground that its pastor was self-employed and not an employee, and accordingly his negligence could not be imputed to the church. The California Supreme Court concluded that the pastor was an employee of his church and that his negligence was imputable to the church.[33] Vind v. Asamblea Apostolica De La Feen Christo Jesus, 307 P.2d 85 (Cal. 1957). In reaching this decision, the court employed the same criteria used by the California Supreme Court in the Malloy case. See note 28, supra, and accompanying text.
  • The Colorado Supreme Court concluded that a pastor was an "agent" of his denomination, and as a result the denomination could be liable on the basis of negligent hiring for his sexual relationship with a woman in the course of marital counseling. The court acknowledged that "a prerequisite to establishing negligent hiring is an employment or agency relationship." Did such a relationship exist between the diocese and the assistant pastor? The court said "yes." It defined an agency relationship as one in which one person (the "agent") acts on behalf of another (the "principal") subject to the other's control. The court continued, "At trial, sufficient evidence was presented to establish that the structure of the Episcopal Church was such that the diocese and [the bishop] had and exercised the right of control over the manner of work performed by a priest as well as the hiring, compensation, counseling performed by the priest and discipline of the priest. The evidence was sufficient, in this case, to support the finding of an agency relation between the diocese and [the pastor]." The court noted that in addition to controlling certain aspects of hiring, compensation, and discipline, the diocese also controls and supervises the duties of pastors in their role as counselors. It observed that the bishop had "given talks" about counseling issues to pastors in the diocese. In addition, the diocese "had specific printed regulations on pastoral counseling and that these regulations describe the form counseling should take. The regulations include such details as how appointments are to be kept, what attire is to be worn, where in the room the prayer book and desk should be, and even how the pastor should sit." The court concluded, "All of these facts indicate that a priest is not independent of the diocese but is controlled by the diocese and the bishop. The priest's education is monitored by the bishop, he is put through a screening for hire by the diocese which includes psychological evaluation. The priest's compensation is affected by the bishop, the priest's discipline is controlled by the bishop, and every part of the form of the priest's counseling is regulated by the diocese. The evidence at trial created a factual issue regarding whether an agency relationship existed. The trial court properly submitted this issue to the jury for determination and the jury found that there was an agency relationship between [the assistant pastor] and the diocese." [34] Moses v. Diocese of Colorado, 863 P.2d 310 (Colo. 1993).
  • The Kansas Supreme Court concluded that injuries caused by a Catholic priest's negligent driving were not imputable to his diocese since the priest was self-employed rather than an employee.[35] Brillhart v. Scheier, 758 P.2d 219 (Kan. 1988). A dissenting judge felt that the priest was an employee, and that his negligence should have been imputed to the diocese. The dissenter pointed to the following factors: (1) the diocese issued the priest W-2 forms each year; (2) the priest was on call 24 hours a day; (3) the priest's term of employment was indefinite; (4) the priest's work clearly furthered the regular business of the diocese; (5) the priest "was not engaged in an independent occupation in the sense that he contracts with different churches to perform pastoral services on a job-by-job basis; rather, he is engaged solely in his parish and can accept no other assignments without the consent of the bishop." In reaching this conclusion, the court applied the "right to control test" under which a worker is considered to be an employee if the employer either controls or has the right to control the person's work. In concluding that the priest was not an employee, the court relied on the following factors: (1) the priest's "day-to-day activities are within his own discretion and control"; (2) the priest is authorized under canon law to do whatever he feels necessary to carry out his duties; (3) he sets his own hours and vacation; (4) he makes out his own paycheck, and hires and fires non-clergy workers; (5) he has complete discretion in purchasing church supplies and paying bills out of parish funds; (6) his work requires a high level of skill and experience and is generally done without supervision; and (7) he was driving his own car at the time of the accident and had obtained his own insurance on the vehicle. Under these facts, the court concluded that the priest was not an employee of the church. Since self-employed persons are not subject to an employer's control with respect to the manner and methods of performing their duties, the diocese was not responsible for the priest's negligence. The court acknowledged that the priest was clearly subject to the "ecclesiastical control" of his bishop, the diocese, and the Catholic Church, but such control was not relevant in determining the issue of legal control for purposes of imputing liability to the diocese on the basis of respondeat superior. The court also noted that the diocese "followed the majority of dioceses in issuing a W-2 form to each priest," but was this practice inconsistent with its conclusion that the priest was self-employed for purposes of respondeat superior. This decision is significant because it recognizes that (1) a church or religious denomination will not necessarily be legally accountable for the negligence of a minister merely because the minister is subject to the "ecclesiastical control" of the church or denomination, and (2) ministers who are treated as employees for federal income tax purposes (and are issued W-2 forms) will not necessarily be considered employees for purposes of holding their church or denomination legally responsible for their actions under the principle of respondeat superior.
  • In a case of enormous importance to denominational agencies, a Minnesota appeals court applied the "bar association analogy" in concluding that a regional church and national church (the "church defendants") were not liable for the sexual misconduct of a pastor since the relationship between them and credentialed clergy (which resembled the relationship between state bar associations and licensed attorneys) was too attenuated to justify the imposition of liability for clergy misconduct. The court noted that under the respondeat superior doctrine, "an employer is vicariously liable for the acts of an employee committed within the course and scope of employment." The victim argued that an employment relationship existed between the pastor and church defendants because he was an ordained minister in good standing and his name was on the "clergy roster." Further, she claimed that the church defendants exercised enough control over a pastor's ministry to give rise to an employment relationship. In particular, she noted that the church defendants (1) determine who is qualified to be a minister; (2) demand that ministers agree and abide by their constitutions and bylaws; and (3) retain the authority to discipline ministers, including the authority to remove them from their pastoral ministry. The court concluded that these facts "did not automatically mean a true employment relationship exists" that would support the imposition of liability on the church defendants for the misconduct of ministers on the basis of respondeat superior. The court drew an analogy to the relationship between attorneys and the state supreme court. In Minnesota, the supreme court "through the Rules of Professional Conduct, sets forth the rules and standards by which lawyers must adhere. If these rules are violated, the court may discipline the responsible attorney. But this relationship between the supreme court and the disciplined attorney is not an employment relationship. There has to be something more." Similarly, the regional and national churches in this case had "limited control over the pastor." But, "the congregation, not the umbrella entity, has the responsibility for hiring and firing the pastor, setting forth the terms and conditions of employment, supplying the pastor with parsonage, vacation and supplies, and paying the pastor. [It] is the congregation, not the [regional or national churches], which employs the minister." The court concluded that the church defendants were not liable on the basis of respondeat superior for the pastor's acts of molestation because an employment relationship did not exist. In addition, his wrongful acts were not committed in the course of his employment, as required by the respondeat superior doctrine. [36] C.B. ex rel. L.B. v. Evangelical Lutheran Church in America, 726 N.W.2d 127 (Minn. App. 2007).

nonminister church workers

  • A Louisiana appeals court ruled that a church was responsible for injuries sustained in an automobile accident caused by the negligent driving of a deacon while on church business. [37] Whetstone v. Dixon, 616 So.2d 764 (La. App. 1993).
  • A Louisiana appeals court ruled that a church could not be liable on the basis of respondeat superior for sexual assaults committed by a volunteer worker[38] Doe v. Roman Catholic Church, 602 A.2d 129 (La. App.1992).. The court concluded: "Determination of whether a given volunteer is in fact a servant generally depends on the charitable organization's right to control the activities of the volunteer. Determination of the right to control is a question of fact, based on consideration of the following factors: (1) degree to which the charity orders the volunteer to perform specific actions; (2) degree of contact between the charity and the volunteer; and (3) structural hierarchy of the charity. …" This test was not met in this case, the court concluded.
  • An Ohio court ruled that a denominational agency was not responsible for a local church elder's actions even though it exercised ecclesiastical control over him. [39] Nye v. Kemp, 646 N.E.2d 262 (Ohio App. 1994).

In summary, the determination of a minister's status for purposes of imputing liability to an employing church on the basis of respondeat superior is a complex inquiry that requires an analysis of all of the facts of each case. More recent court decisions are less likely to jump to the conclusion that clergy are employees. Some courts have drawn the helpful distinction between ecclesiastical and temporal control. The fact that a church exercises ecclesiastical control over a minister should not be controlling in determining whether or not the minister is an employee for purposes of assigning legal liability to his or her employing church. Courts should focus on aspects of temporal control in determining whether or not a minister is an employee for such purposes.

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