Dive Brief:
- A Hispanic man whose independent contract with an insurance company was terminated after his wife and assistant wrote a threatening email from his account — allegedly causing the district manager to tell her “they don’t want … some crazy brown man running around with a gun” — should have his discrimination case heard by a jury, the 10th U.S. Circuit Court of Appeals ruled on Wednesday (Cruz v. Farmers Insurance, No. 21-1069 (10th Cir. August 3, 2022)).
- While a district court initially granted summary judgment for the company, declaring the comment “hearsay,” the 10th Circuit reversed, noting that the manager was an “agent” of the company, even if not an employee.
- Though the manager was an independent contractor, the court noted, he was acting on behalf of the company and relaying information in that role when he delivered the comment.
Dive Insight:
Hearsay is an out-of-court statement offered to prove the truth of whatever it asserts, according to Cornell Law School’s Legal Information Institute; in other words, a secondhand statement. It is generally not admissible in court.
In this case, however, both the plaintiff and 10th Circuit disputed this characterization of the evidence presented. While the insurance company argued that independent contractors are generally not considered exempt from hearsay claims, the court disagreed.
The 10th Circuit noted that statements are not considered hearsay if offered against an opposing party and “made by the party's agent or employee on a matter within the scope of that relationship and while it existed.”
Independent contractors can be agents, the court noted. And because the district manager delivered the comment during a phone call made for the purpose of explaining the potential termination decision, he was acting as an agent at the time, the court explained — causing it to fall within the scope.
Though this case is yet to be decided, HR pros may want to note that a company may be responsible for comments made by those working on its behalf — even in contractor or other nonemployee roles — if the comments are made while carrying out that work.
