Agency and Employment Law

frolic and detour:

activity occurring outside of the scope of employment -only when the employee is on a frolic will the principal not be liable detour: not 100% part of what you're supposed to be doing, but anticipated you do it (pull into gas station to get a coke) -accident as you pull into gas station; employer's responsibility

types of authority

actual implied apparent agency by ratification when can a worker enter into a contract that the employer has to honor

apparent authority

agency arises through principal leading others to believe that he has an agent -principal does things to make 3rd party believe they have the authority to act on its behalf *professor order computers and Terry pays bill, professor has apparent authority, apple will now think terry will pay it and Lara has authority -if employers accepts payment on behalf of company and the company never objects, then the company assumes this is who I make my payments to -not correcting the 3rd party's impression happens alot with former employees, your chef, been buying food from a supplier, restaurant always pays the bill, chef quits, gets fired, restaurant still has to pay the bill bc principal didn't notify the food supplier that person had no more authority bc supplier expects payment bc chef acted with apparent authority -employer is supposed to notify everyone the employee did business with that they were fired

implied authority

agency inferred from the acts of an agent who hold position of authority -never been expressly told, but its inferred by your position *general manager finds roach in customer's meal, comps it, they have this implied authority -why? employer can't have told them everything they can/can't do

undisclosed

agent acts without disclosing the existence or identity of the principal to the 3rd party -all types of authority: agent is responsible happens when employee can get a better deal than the principal, agent is paid to do it

criminal liability

businesses may also face cirminal liability for the acts of their employees -securities regulation -antitrust

questions to differentiate btw employee/IC:

1. How much control does the employer exercise over the details of the work? 2. Is the worker engaged in an occupation distinct from that of the employer? 3. How long is the person employed? -indefinite period: employee -short period: IC 4. How are they paid? -regular basis: employee -upon completion of task: IC 5. Is this type of work usually done under the employer's control? -think of the general scenario, what sually happens, ex: hire a group to build a porch, hand them nails, lots of control-employee, but usually IC 6. Does the employer supply the necessary tools for work? -no: IC -yes: employee 7. What degree of skill is required? -very specialized: IC

COBRA

Consolidated Omnibus Budget Reconciliation Act -prohibits employer from eliminating a worker's medical insurance on the voluntary or involuntary termination of the worker's employment -if you have health insurance thru your employer and you leave (quit/laid off) employer must allow you to continue your medical insurance -have 60 days after you leave to decide if you want you COBRA benefits that you had under your employment -can continue for 18 months some don't, why? -very expensive (employee now has to pay both) -can find another job

FLSA

Fair Labor Standards Act -makes min wage (7.25) -max hour laws -40 hour work week -overtime: time and a half -salaried employees/managerial employees dont get overtime -tipped employees (2.13/hour, if tips dont reach min wage, employer must make up difference

FMLA

Family and Medical Leave Act: -allows eligible employees to take up to 12 weeks of unpaid leave during a 12-month period for ***birth or care of a newborn, or adoption of a kid ***care of an immediate family member with a serious health condition (parent, spouse, child under 18) ***employee who is unable to work due to her own serious health condition -employer must have 50 employees, employee has to had worked there for 12 months (doesn't have to be consecutive) employer can't discriminate against you for taking leave, can't not give you bonuses -treatment for drug abuse qualifies

agency

a consensual relationship under which one person (agent/employee) acts on another's behalf (principal/employer) and subject to his/her control when is this person allowed to act on my behalf and beholden to my instructions? courts don't defer to the contract, they look act what the relationship acts like bc employers would always say they're an IC

duties of agents and principals

agent responsibilities: duty of loyalty: don't tell trade secrets, customer lists, not work for competitor duty of obedience: obey reasonable instructions (if he says dont bid more than 10 mill, and you bid 11 mill, can be sued for that extra 1 mill) duty of care: if you're a manager, clean up aisles in reasonable time to avoid negligence lawsuit

termination of agency relationship

can be terminated by agent or principal reasons: -lapse of time (contract says you're my agent for 6 months) -purpose achieved (real estate agent sold house) -by operation of the law (impossible to continue: house burns down, agent dies, principal becomes bankrupt) ***principal has duty to notify third parties of termination or risk apparent authority liability

principal responsibilities

compensation, indemnification: pay agents for expenses in carrying out principal's order, like travel expenses

contractual liability

depends on authority and whether the principal is disclosed, partially, or undisclosed to the 3rd party

types of disclosure

disclosed principal partially disclosed undisclosed does the 3rd party realize who the employer is/who they're acting on behalf of?

workers compensation

employee's acceptance of worker's comp benefits bars the employee from suing for injuries caused by the employer's negligence getting payment bc you were injured on the job or while traveling -either get workers comp OR sue suing: -usually negligence, tort -I wasn't trained well, machinery was unsafe -problems: principal may retaliate, risk of losing, must prove all parts of negligence -price of attorney -lots of time workers comp: -not assigning blame to anyone -could be employee's 100% fault, but get payment for medical bills, disability leave -company pays taxes (insurance) and employee get this money agency -just have to show you were injured

respondeat superior

let the master reply, let him be responsible, another word for vicarious liability why is the principal responsible: -it wouldn't have happened if they weren't employed, if they weren't doing the delivery, enjoy benefits of employment, must be liable for consequences -employers have no defense of I warned them, I trained them to drive carefully, once employee's negligence is established, employer is strictly liable for employee's financial mistakes

How much control does the employer exercise over the details of the work?

more control: employee less control: IC

OSHA

occupational safety and health administration -regulates hazardous conditions in the workplace ex: exposure to toxic waste, protocol if someone is injured, how many breaks you can get, max time you can be standing up -repetitive stress injuries problem: penalties are very weak, employers often find its cheaper to pay fine than change practices why? -congress doesnt want to run companies out of business -political leverage: people that are harmed by this are in lower income jobs (blue collar doing more manual work) and dont have political captial to make this a stricter law -or business could take jobs overseas and people would lose their jobs here, in this economy, its hard to threaten this bc companies would go overseas

actual authority

principal expressly instructs an employee to act on its behalf -in writing or verbally *dean told you to order computers, you were told you have that authority

tort liability: IC

principal is generally not liable for torts by IC (short term, for specific task, under less control, more independent) exceptions: -inherently dangerous activities (high likelihood others will be injured-not roofing) -negligently hired IC (if IC harms someone employer can be responsible) **no background on security guard-make sure they aren't felons, robs tenant, sue apartment complex bc they were negligent in hiring

tort liability: employee

principal is liable for both intentional and negligent conduct of employees while acting in the scope of employment ex: construction worker dropping a brick on someone's head, not putting up a wet floor sign, bartender punches customer, crash company vehicle on the job employer not liable: when employee id driving to work, on lunch break (scope of employment) principal is generalyl liable for their actions exception: frolic

frolic

principal isn't liable, something you shouldn't be doing on the job ex: bus driver picks up friends Not frolic: drinking on the job typically jobs that involve driving visiting friends, then car accident, deviated from the job

Frontline Iron foundries documentary

safety conditions suck, people died all the time, not allowed to go to the bathroom so they pee their pants, 60% of workers injured no safety guards on moving parts, work on machines while they're running, air poluttion-16 times more than allowed, why is the law so weak? not many resources, not enough enforecment personnel, fines are very small, only misdemeanors, workers file workers comp bc its quicker and so business gets no punitive damages

is the worker engaged in an occupation distinct form that of the employer?

same job: employee different job: IC plumber at law firm: IC full time janitor of law firm, 30 years: employee

independent contractor

someone hired to perform a specific task

employment-at-will

what the US is, you have the right to leave employment for whatever reason you want, employer can lay you off for almost any reason exceptions: on a contract-athlete must be paid for 2 years even if they're injured and unable to play

agency by ratification

when a principal voluntarily decides to honor an agreement entered by someone without proper authority -one time ratification -usually when its a good deal

vicarious liability: principal's liability for agent's conduct

when are the actions of a worker the responsibility of the principal? varies depending on whether the agent is an employee or an IC

partially disclosed

when the 3rd party knows that the agent is acting for a principal but does not know who the principal is -actual/implied: agent/principal liable -none: principal never bound

fully disclosed principal

when the third party knows that the agents is acting on behalf of a principal and knows who that principal is "I'm acting on behalf of donald trump" -if actual/implied authority: donald is bound by contract -apparent: employer must pay but then can sue agent -none: principal not bound, agent must pay

employee privacy rights

workplace surveillance drug testing (IF THERE COULD BE A PUBLIC SAFETY OR HEALTH RISK) can monitor how much time you spend on certain sites, keystrokes, cameras, email checking, monitor FB (allowed to avoid negligent hiring) -what if you learn religious beliefs/sexual orientation/pregnant --be careful that employee states later thats why they didn't get the job not much privacy