1. Do you agree with the court that there is no “functional difference” between the three tests—the “common law agency” test, the “economic realities” test, and the “common law hybrid” test—for whether someone is an employee or an independent contractor?

2. Even if it might not be vital in this situation, could you imagine a circumstance where the distinction could be great and a different decision would result under one or several of these tests?

3. What is the value in the court’s decision in reaching convergence among the three tests in Murray?

Issue: Whether a financial agent pursuing a Title VII sex discrimination claim was an employee or an independent contractor. What factors should be considered in making this distinction, and which legal test best captures these factors?

Facts: Plaintiff Patricia Murray, is a “career agent,” selling defendant Principal Financial Group’s products, including a wide range of financial products and services, including annuities, disability income, 401(k) plans, and insurance. Murray sued Principal for sex discrimination in violation of Title VII and the court had to determine whether Murray was an employee or an independent contractor within the meaning of that statute since she would be entitled to the protections of Title VII only if she was an employee.

Decision: The 9^th Circuit Court determined that Murray was not an employee; but, the case is important for its analysis of the type of test to be applied. The appellate court affirmed the district court’s finding that there is no significant difference between the three tests established in previous judicial decisions: the “common law agency” test (Darden), the “economic realities” test (Adcock), and the “common law hybrid” test (Lutcher). The “common law agency” test is characterized as “focus[ing] on the hiring party’s right to control the manner and means by which the product is accomplished.” In the same vein, the district court asserted that the “primary factor” of the “economic realities test” is “the extent of the employer’s right to control the means and manner of the worker’s performance.” The district court saw the “common law hybrid” test as combining the enumerated factors of the previous two tests. The Ninth Circuit found that Darden is the controlling case for the purposes of Title VII, and asserted that its “common law agency” test, with its primary focus upon who has control over the “manner and the means” of production, encompasses the others.