dissenting:
The majority today decides that once the corporate form is chosen for the avowed and conceded purpose of gaining tax advantages, the corporate entity is bound by that choice for all other purposes, including being subject to the anti-discrimination laws. Because NHRA chose to adopt the corporate form the majority holds that NHRA is bound by that choice and, appellant Hyland, merely because he worked for that corporation must be classified as an employee when a court applies the ADEA. Because I disagree with both of these contentions, I respectfully dissent.
First, we are not obliged to adopt a take-it-or-leave-it attitude toward the status of NHRA and hold that once a corporation, then always a corporation. The manner in *799which a corporation functions determines what kind of entity it is for purposes of the discrimination laws. Neither labels, nor titles dictate the answer. Second, regardless of the talismanic words used to characterize the actual manner in which NHRA functioned — corporation or partnership— the ADEA does not mandate that everyone who works for a corporation must be an employee within the Act, as the majority believes. The label that characterizes the substance of an entity does not necessarily determine the employment status of all those who work within it. The only hard and fast rule is that there should be no hard and fast rule to determine an individual’s employee status for purposes of coverage within the anti-discrimination provisions of the ADEA. Case by case determinations best fulfill that Act’s purposes. Hence, the status of the entity Hyland was associated with and his status within that entity must be analyzed in order to determine whether he was an employee covered by the ADEA.
I STATUS OF ENTITY
The district court made a finding that NHRA should realistically be characterized as a partnership rather than a professional corporation, since the “structure of defendant’s business is an equal division of ownership and management, and the equal sharing of profits and losses among the members, are all hallmarks of partnership status.” I agree.
Appellant counters this conclusion by citing cases where courts evinced a general refusal to look beyond the corporate form, once the members of that entity made that choice. Yet, even in the context of an adjudication of tax liability, the Supreme Court has recognized the need to look at the substance of a transaction when the purposes behind an applicable statute have been subverted.
The rule which excludes from consideration the motive of tax avoidance is not pertinent to the situation, because the transaction upon its face lies outside the plain intent of the statute. To hold otherwise would be to exalt artifice above reality and to deprive the statutory provision in question of'all serious purpose.
Gregory v. Helvering, 293 U.S. 465, 470, 55 S.Ct. 266, 268, 79 L.Ed. 596 (1935).
In the present case, substance should also take precedence over form, not because “corporation” and “partnership” are ambiguous terms, but because the Act’s broad definition of employee leaves the individual’s status to be determined in each case irrespective of the form chosen to conduct business or the labels attached to an individual. This proposition finds ample support in the decisions. See, e.g., E.E.O.C. v. Dowd & Dowd, Ltd., 736 F.2d 1177, 1178 (7th Cir.), reh’g and reh’g en banc denied (1984) (role of an attorney shareholder in attorneys professional corporation more analogous to a partner than corporate shareholder. The reality of the situation, i.e., management, control, and ownership closely resembled a partnership and these realities control, not the corporate label under which the entity operated); Armbruster v. Quinn, 711 F.2d 1332, 1340 (6th Cir.), reh’g denied, (1983) (while parties’ view of relationship is evidence of whether one is an employee, it is not determinative; the economic reality of the relationship is examined); Spirides v. Reinhardt, 613 F.2d 826, 829, 832 (D.C.Cir.1979) (in applying the statutory language and legislative history of Title VII mere fact that contracting parties label an individual an independent contractor does not bind a court when an examination of the substance of that relationship dictates otherwise).
Examining the economic and structural realities of NHRA for purposes of applying the ADEA, the district court correctly found that the organization established by the original founding doctors more closely resembles a partnership than a corporation. This conclusion necessarily follows from a consideration of the distinctions between the two forms. Section 6 of The Uniform Partnership Act defines a partnership as “an association of two or more persons to carry on as co-owners a business for prof*800it.” Partners traditionally manage and control the business and share in the profits and losses. “A partnership is generally said to be created when persons join together their money, goods, labor, or skill for the purpose of carrying on a trade, profession, or business and when there is a community of interest in the profits and losses.” Commissioner v. Tower, 327 U.S. 280, 286, 66 S.Ct. 532, 535, 90 L.Ed. 670 (1946). Moreover, shareholders in a professional corporation rarely achieve the total limitation of personal liability enjoyed by owners of a corporation, and are subject to liability for malpractice. See Dowd & Dowd, Ltd., 736 F.2d at 1178-79.
Further support for concluding that NHRA was a partnership is found in the fact that each founding member contributed an equal amount of capital and agreed to be bound by the shareholders’ agreement and by individual employment agreements. All shareholder members were required to and practiced the same specialty (radiology) and agreed to share a designated percentage of the profits and losses, as well as management responsibilities. All could withdraw at any time, turn in their stock and be paid according to an agreed method of valuation. While not all professional corporations are partnerships, NHRA’s insistence on equality in vote, voice and profits for all member-shareholders, including those subsequently joining the practice, demonstrates, as the district court found, that structurally and economically the entity is best characterized as a partnership.
II HYLAND’S STATUS
A. No per se Rule Applies
Next, consideration should be given to Hyland’s status within that partnership. It is tempting to adopt a rule that everyone who works for a corporation is an employee, and everyone labelled “partner” is a partner. Like life, the law is not that simple. In fact, decisional law makes plain that no per se rule has been adopted that includes all those working for a corporation as employees — regardless of the amount of their stock ownership, their lack of involvement in the day-to-day activities' of the business, or their failure to perform additional employee duties. And, by the same token, no rule excludes high-level individual officers in corporations from being considered as employees for purposes of the ADEA. See, e.g., Zimmerman v. North American Signal Co., 704 F.2d 347, 351-52 & n. 4 (7th Cir.1983) (unpaid, inactive corporate officers or directors not characterized as employees; labels do not control as decisive issue is whether an employer-employee relationship exists rather than title held by worker); Bonilla v. Oakland Scavenger Co., 697 F.2d 1297, 1300 (9th Cir.1982), cert. denied, 467 U.S. 1251, 104 S.Ct. 3533, 82 L.Ed.2d 838 (1984) (member-shareholders in family corporation, where each member owned an equal block of shares, classified as employees); E.E.O.C. v. First Catholic Slovak Ladies Ass’n, 694 F.2d 1068, 1070 (6th Cir.1982) (coverage under ADEA should not center on labels the organization gives a position).
B. Legislative History
The question is what definition should be used to determine whether Hyland is an employee or a traditional partner of NHRA. The first place to look is the statute. The Act’s inconclusive definition — an individual employed by any employer — is of no help. While the legislative history is sparse, it does reveal Congress’ aim to permit classification of professionals — for example, professors, doctors, and lawyers — as employees. One of the 1972 amendments to Title VII extended its coverage to academic institutions. 42 U.S.C. § 2000e-l (1982). Further, Congress considered but did not include a proposal that physicians be excluded from Title VII’s protection. 118 Cong.Rec. 3802 (1972) (Statement of Senator Javits).
There can be no doubt that it was Congress’ purpose to prohibit employment discrimination against “any individual” in an employment relationship of the type defined in the Act. Fairleigh Dickinson University, 646 F.2d at 828; 29 U.S.C. § 623(a); see also 29 U.S.C. § 621 (state*801ment of findings and purpose). Title VII’s legislative history indicates that the term “employer” was intended to have “its common dictionary meaning, except as expressly qualified by the Act.” 110 Cong.Rec. 7216 (April 8, 1964). It would seem to follow that the same common, dictionary meaning should be used when defining the term “employee” because “legislation when not expressed in technical terms is addressed to the common run of men and is therefore to be understood according to the sense of the thing, as the ordinary man has a right to rely on ordinary words addressed to him.” Addison v. Holly Hill Co., 322 U.S. 607, 618, 64 S.Ct. 1215, 1221, 88 L.Ed. 1488 (1944).
C. Partnership Under the ADEA
Those cases that consider an individual’s status in a partnership setting are particularly relevant. They support the view that those labelled “partners” do not always fall within the traditional definition of that term. When all the indicia of partnership status are not present, an individual is an employee within the purview of the ADEA — regardless of the label attached to his position. Such an approach best fulfills the Act’s remedial purposes.
The Supreme Court in Hishon v. King & Spalding, 467 U.S. 69, 104 S.Ct. 2229, 81 L.Ed.2d 59 (1984), held that a law partnership’s decision to deny admittance of a female associate/employee into the partnership was covered by the provisions of Title VII. In a concurring opinion, Justice Powell wrote to express his view that the Court’s decision did not apply to the relationship among already existing partners, who cannot be characterized as employees. Id. at 2236. The concurring justice added “[o]f course, an employer may not evade the strictures of Title VII simply by label-ling its employees as ‘partners.’ ” Id. at 2236 n. 2.
The Equal Employment Opportunity Commission (“EEOC”), the agency charged with the interpretation and enforcement of both Title VII and the ADEA, has adopted a similar position. In E.E.O.C. Decision No. 85-4, CCH Emp.Prac.Rptr. 116845, at 7040 (March 18, 1985), the Commission found that partners in an eight-member law firm could not be classified as employees for purposes of Title VII. Examining a number of factors, the Commission was influenced by the fact that all the partners controlled and managed the operation of the business, each partner had an equal voice in the management and direction of the firm, and all profits and losses were, shared according to designated percentages outlined in the partnership agreement. Id. at 7040. But the Commission recognized that, in some cases, an individual who is called a partner may be characterized as an employee. “In determining whether the individual is a partner or an employee in a particular case, the Commission will consider relevant factors including, but not limited to, the individual’s ability to control and operate the business and to determine compensation and the administration of profits and losses.” Id. at 7041 n. 4.
The Commission’s view received judicial support in E.E.O.C. v. Peat, Marwick, Mitchell and Co., 589 F.Supp. 534 (E.D.Mo.1984), aff'd, 775 F.2d 928 (8th Cir.1985), when it sought to compel the accounting firm’s compliance with a records subpoena relating to an investigation of its mandatory retirement policies. Peat, Marwick argued that the subpoena issued by the EEOC was not reasonably related to any purpose of the ADEA since it sought information concerning possible discrimination against partners, and partners in an accounting firm are not employees protected by the provisions of the Act. The court upheld enforcement of the subpoena and agreed with the EEOC that respondents may label some of its members as “partners”, when in reality those members may not fit within the traditional definition of the term. 589 F.Supp. at 538.
D. Factors Appropriate for Testing the Status of Persons Associated with a Partnership Under ADEA
Although the right to control/economic realities test is appropriate, for example, to test whether a person is an independent contractor or an employee, the majority *802correctly observes that this classic hybrid test is inappropriate in a partnership setting. Some of the factors, for example, skill required, equipment furnished and place of work, length of time worked are not relevant inquiries. Moreover, the focus is different when analyzing employment in a partnership setting since the question is the status of the individual within an organization of which he is concededly a part. By contrast, when testing whether someone is an independent contractor the question is not the individual’s status within the entity, but rather whether the person is or is not a member of that entity.
When applying the ADEA a court must evaluate two factors in deciding whether a so-called partner in an entity best characterized as a partnership should be classified as a traditional partner or as an employee. Those two factors are compensation and control. The first is more accurately stated as whether profits and losses were shared according to a predetermined formula. Traditional partners need not share profits and losses equally; but unless each is paid a predetermined share of profits, the individuals are not actually carrying on the business as co-owners. In this case, the shareholders’ agreement stipulated in advance for an equal division of profits and losses between the shareholder members and any subsequently admitted member.
Second, is the individual’s control and responsibility vis-a-vis the other partners in the organization. Although all individuals need not have an equal voice, an individual whose voice in the management of a business is substantially less than the others is better classified as an employee since — unlike a traditional partner — he lacks a significant voice in the business’ direction. An individual whose opinions and business judgment are drowned out by more powerful individuals is more susceptible to the discriminatory practices that the ADEA and Title VII were designed to eliminate. Here, Hyland had an equal right to operate and control New Haven Associates. No shareholder-member exercised any greater degree of control in the management of the business than he did. Concededly, the entity here is a small one; but size is not the test when analyzing control and responsibility. He was one of the original group of radiologists who founded a business that they could manage and profit by. They were employees in name only, and organized their entity as a corporation only to the extent that the tax laws required them to do so.
This original group therefore considered themselves as founders and owners, not employees. After examining Hyland’s compensation and control, it is evident that he was in fact a traditional partner, and not an employee.
Ill CONCLUSION
Therefore, NHRA should be immune from liability for discriminating against him on the basis of age. For the majority now to treat Hyland and his co-partners as employees places a premium on devising a simplistic rule easy to apply, but one that ignores the reality of the entity’s and the individual’s status. Accordingly, I vote to affirm the order granting summary judgment in favor of NHRA and that dismissed appellant’s complaint.