9th Circuit Rules That Rehabilitation Act Covers Discrimination Claim By an Independent Contractor

The Rehabilitation Act of 1973 was the first major federal statute to focus on the rights of individuals with medical impairments.  Section 504 of the Act creates a private right of action for individuals claiming to have been discriminated against in any “program or activity” receiving federal financial assistance.  Courts have included federally funded employment as one such “program.”
  
Amendments to the Rehabilitation Act have incorporated certain standards and remedies from other civil rights laws, and specifically have incorporated the standards of the Americans with Disabilities Act that determine whether employment discrimination has occurred.  The 9th U.S. Circuit Court of Appeals recently addressed an issue on which appellate courts are divided, and has held that unlike the ADA, the Rehabilitation Act protects independent contractors as well as employees.  Fleming v. Yuma Regional Medical Center, 9th Cir., No. 07-16427, 11/19/09.

Dr. Lester Fleming entered into a contract in May of 2005 to provide anesthesiology services to Yuma Regional Medical Center in Yuma, Arizona.  Prior to beginning work in November of that year, Fleming was asked – and refused – to sign an addendum to his employment contract that would have precluded a schedule that accommodated Fleming’s sickle cell anemia.  Based on that refusal, Fleming’s employment contract was cancelled.  Fleming sued Yuma for breach of contract and for violation of Section 504 of the Rehabilitation Act.  The district court granted summary judgment in favor of Yuma, ruling that Fleming was an independent contractor and, as such, was not protected from disability discrimination by the Rehabilitation Act.  Fleming did not dispute his independent contractor status, but appealed the determination related to whether he was covered under the Act.

The Ninth Circuit reversed the dismissal, ruling consistently with a prior Tenth Circuit decision that Section 504 incorporates only the ADA’s standards for what conduct violates the Act, and not the definition of who is covered by the protections of the Act.  The Court based its determination on the fact that the Rehab Act is broader than the ADA, covering any “otherwise qualified individual” who has been excluded from a program receiving federal funds, and not just employees.  Further, the programs covered under Section 504 are all such operations, not just employment, whereas the ADA is limited to the employer-employee relationship.  Because Congress did not use general language when it referred to the ADA in Section 504, and did not restrict the scope of the Act to employment, the Ninth Circuit was hesitant to “reduce the express scope of the Rehabilitation Act by wholesale adoption of definitions from another Act.”

The Ninth Circuit’s decision puts it in direct conflict with the Sixth and Eighth Circuits, each of which previously has held that Section 504 does incorporate the ADA’s employer-employee relationship requirement into the Rehabilitation Act.  While the Ninth Circuit’s opinion spells out the rationale for its divergence from these decisions, there still exists a major split in the Circuits on the issue, creating an issue of concern for employers and their attorneys in the remaining circuits, and one which they will be following until the issue is addressed, if ever, by the U.S. Supreme Court.  In the meantime, employers should be aware of this decision, and should take it into account when making decisions related to employees and independent contractors with medical impairments.