Cynthia Morgan v. Safeway Stores, Inc., and Safeway Arizona Federal Credit Union

dissenting:

I dissent because I believe that an employer cannot escape the reach of Title VII by delegating its responsibility for the evenhanded provision of fringe benefits to a third party whom the employer knows will discriminate on the basis of pregnancy. I find this case particularly troubling in light of the substantial overlap in operations between Safeway and SAFCU.

Although I agree with the majority’s conclusion that the overlap between Safeway and SAFCU is insufficient to satisfy the “single employer” test set forth in Childs, that test does not govern Morgan’s action against Safeway. In Childs, the plaintiff attempted to hold the international union liable for an alleged discriminatory firing by the local union of the local’s own employee. Childs v. Local 18, International Brotherhood of Electrical Workers, 719 F.2d 1379 (9th Cir.1983). The court adopted the “single employer” test formulated by the NLRB to determine whether to hold the international responsible for the local’s labor policies on the ground that the local was the alter ego of the international. See id. at 1382 ; see also Baker v. Stuart Broadcasting Co., 560 F.2d 389 (8th Cir.1977) (adopting the single…

Cynthia Morgan appeals a summary judgment in favor of her employer, Safeway Stores, Inc. (“Safeway”) and her credit union, Safeway Arizona Federal Credit Union (“SAFCU”). She sued both defendants under Title VII of the Civil Rights Act of 1964, as amended, 42 U.S.C. § 2000e-2 (1982), for the discriminatory denial of credit disability benefits.

I. Background

Safeway is an employer for title VII purposes. It provides its employees traditional compensation and fringe benefits, such as medical insurance and disability programs. In addition, it offers its employees the opportunity to join SAFCU.

SAFCU is a federal credit union organized under 12 U.S.C. §§ 1751-95 (1982 & Supp. IV 1986). To assure that members share a “common bond of occupation or association” or reside in a “well-defined neighborhood, community, or rural district,” id. § 1759, an application for a federal credit union charter must contain a proposed “field of membership,” id. § 1753. SAFCU listed Safeway and its affiliates as its field of membership. Throughout the period relevant to this action, SAFCU’s field of membership consisted only of employees and their families of Safeway and SAFCU. By law, SAFCU’s board of…

884 F.2d 1211 50 Fair Empl.Prac.Cas. 1339 , 51 Empl. Prac. Dec. P 39,314 , 58 USLW 2210 Cynthia MORGAN, Plaintiff-Appellant, v. SAFEWAY STORES, INC., and Safeway Arizona Federal Credit Union, Defendants-Appellees. No. 88-1785. United States Court of Appeals, Ninth Circuit. Argued and Submitted Feb. 6, 1989. Decided Sept. 6, 1989. Grace McIlvain and Dennis P. McLaughlin, Miller & Pitt, Tucson, Ariz., for plaintiff-appellant. William R. Hayden and Tibor Nagy, Jr., Snell & Wilmer, Phoenix, Ariz., for defendants-appellees. Susan M. Freeman and Richard S. Cohen, Safeway Arizona Federal Credit Union, Phoenix, Ariz., for defendants-appellees. Appeal from the United States District Court for the District of Arizona. Before GOODWIN, Chief Circuit Judge, ALARCON and NELSON, Circuit Judges. GOODWIN, Chief Circuit Judge: 1 Cynthia Morgan appeals a summary judgment in favor of her employer, Safeway Stores, Inc. ("Safeway") and her credit union, Safeway Arizona Federal Credit Union ("SAFCU"). She sued both defendants under Title VII of the Civil Rights Act of 1964, as amended, 42 U.S.C. Sec. 2000e-2 (1982), for the discriminatory denial of credit disability benefits. I. Background 2…