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EMPLOYMENT AGENCIES AND TITLE I OF THE ADA

Consultants' Corner on when an employment agency falls under Title I

From the desk of Linda Carter Batiste, J.D., Principal Consultant/Legislative Specialist

The employment provisions (Title I) of the Americans with Disabilities Act (ADA) require covered entities to provide reasonable accommodations for applicants and employees with disabilities and prohibit discrimination on the basis of disability. The term “covered entities” includes employers with 15 or more employees and state and local government employers. It also includes employment agencies and unions. One of the questions we often get is whether an employment agency has to have at least 15 employees to fall under Title I.

The answer isn’t a simple yes or no. Employment agencies can fall under Title I related to the services they provide to job seekers and also related to their own employees. Regarding the services employment agencies provide, they are covered under Title I if they make regular referrals to at least one covered employer (one with 15 or more employees). The agency itself need not have 15 employees to be covered regarding its services as an employment agency if it meets this standard.

However, employment agencies probably are not covered as an employer for their own employees if they do not meet the 15-employee threshold. Thus, an employment agency with fewer than 15 employees could be liable for disability-based discrimination pertaining to employment referrals, but probably not for discriminating against its own employees. I use the word “probably” because there is a difference of opinion between the federal agency that enforces Title I, the Equal Employment Opportunity Commission (EEOC), and courts that have ruled on the issue. The EEOC’s position is that an employment agency with less than 15 employees is a “covered entity” regarding both its services as an employment agency and as an employer under Title I, but this position has been rejected by the courts.

Summary:

Regarding the clients of an employment agency: the agency is covered under Title I regardless of the number of employees it has and is prohibited from discriminating on the basis of disability in all the services it provides to job applicants.

Regarding the employees of an employment agency: courts have ruled that Title I only applies if the employment agency has at least 15 employees, but the EEOC says that Title I applies regardless of the number of employees. Legal advice may be helpful.

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