FIN 3054

Servant or employee relationship

"YES" responses to these questions may indicate a servant, or employee, relationship Does the principal control details of the work? Does the principal supply tools and place of work? Does the agent work full-time for the principal? Is the agent paid by time, rather than by job? Is the work part of the regular business of the principal? Do the parties believe they have an employee-employer relationship?

Duties of principal to agent

- Duty to reimburse agent for reasonable expenses -Principal must also compensate an agent for unauthorized purchase if agent reasonably believed he was authorized and the principal received a benefit -

Remedies if an agent BREACHES a duty

- Principal can recover damages caused by the agent's breach - Agent must refund any profits made from the agency, if he breaches his duty of loyalty -Principal may rescind (cancel contract) a transaction with a disloyal agent

Elements NOT required for an agency relationship

- Written agreement (unless business requires written contract) - Formal agreement (acting like agent and principal is enough to establish agency) - Consideration (Agent does not have to be paid_

Corporation characteristics

- corporations offer limited liability- personal property not at risk (unless own negligence) -transferability of interests- stock can be bought and sold -lots of expense and effort to create and operate -perpetual exsistence -must pay taxes and file returns -DOUBLE taxation- profits and dividends

Other causes that can terminate an agency relationship

- loss of qualifications -bankrupcy -death or incapacity disloyalty of agent

Duty of loyalty- the Agent

- must act for benefit of principal -may not receive outside benefits without approval from principal - can't disclose confidential information -Cannot compete with principal within scope of agency business -Cannot act for two principals that compete -Agent cannot become a party to a transaction without principal's permission -may not engage in inapropriate behavior that reflects bad on principal

a third party is not bound to contract with an undisclosed principal if

-Contract specifically provides that the third party is not bound to anyone other than the agent OR -agent lies about the principal because they know the third party would refuse to contract with them

Structure consists of 3 main groups

-Directors- oversee affairs -Officers- handle operations -shareholders- look for returns on investment

Big Partnership advantages

-Do not pay taxes -Easy to form

Duties of agent to Principle

-Duty to Obey Instructions _Duty of Care -Duty to provide information

Duties principal owes agent

-Duty to cooperate- cannot unreasonably interfere with agent's ability to accomplish task -Duty to compensate as provided by the agreement -Principal must perform their part of contract

Three types of authority

-Express -implied -apparent

3 defenses against charges to discrimination

-Merit -Seniority -Bonafide Occupational Qualification

Professional Corporations

-Provide more liability protection than partnership. Innocent professional not at risk, only Corps liable for individual's mistake

Other factors in determining if it is a partnership:

-Sharing Profits -Sharing Losses -Management of the business -An Agreement, whether oral or in writing

Effect of termination on Agency Relationship

-Termination ends agent's power to act on behalf of principal -Principal's duty to reimburse expense of the agent ends with agency -Confidential information REMAINS confidential and unusable

employee privacy

-alcohol and drug tests allowed by private businesses, gov can test if signs of use are seen or if job safety is issue BUT... employers may not use lie detector tests, except in investigations of crimes

Change of circumstances

-loss or destruction of subject matter -change of law

Cons to sole proprietorship

-owner is personally liable for ALL business debts -owner has limited options for financing -Business is terminated when owner dies or becomes incapacitated

SOLE PROPRIETORSHIP characteristics

-unincorporated business -owned by one person -easy and inexpensive -earnings reported on owner's personal tax return -can morph into another business entity

5 Elements of an Agency Relationship

1. A Principal 2. An agent 3. Mutual consent for the agent to act on behalf of the principal 4. subject to the principal's control 5. Creating a fiduciary relationship

Principal is bound to acts of an agent if:

1. Agent has authority -A principal is also bound by acts of subagents- those hired by agent 2. Principal, for reasons of fairness, is estopped from denying that the agent had authority 3. principal ratifies the acts of the agent

3 major requirements of Agency

1. Consent 2. Control 3. fiduciary relationship

How to terminate agency relationship (5 ways)

1. completion of agreed term 2. completion of agreed purpose 3. Mutual agreement, no matter what previous agreement was 4. In an agency at will, either party can terminate at any time, for any reason 5. Wrongful termination- either party can terminate relationship, but the wrongful party may have to pay damages

Termination of partnership steps

1. dissolution 2. winding up 3. termination

What are some examples of an intentional torts in the workplace?

1. intentional infliction of emotional distress 2. defemation 3. whistle blowers

the principle is liable for ______ harm caused by ______ conduct of agents WITHIN the scope of employment

1. physical 2. negligence

How to form a corporation

1. pick name 2. file articles of incorporation 3. nominate VA registered agent for corporation 4. draft By Laws 5. Prepare offers for stocks 6. Have an organizational meeting and prep minutes 7. Obtain employer ID number from IRS and decide how you wish to be taxed 8. Corporation should be sure to have annual shareholder and director meetings and to file the required annual report with VA State Corp. Commission

Administration laws

1. workplace safety 2. financial protection

undisclosed principal

3rd party does not know existence of principal -disney thinking of opening in Roanoke but no one else knew

Partnership transferability

A big downside to a partnership is that you cannot transfer your partnership interest to anyone. Without the approval of the other partners, a partner cannot sell her share. A new partner can only be admitted to a partnership by unanimous consent of all the other partners. She can only transfer her right to receive profits and losses; of course, you can give away your profits and losses (losses if someone would want them).

Trusts and Co-Ops

A business trust is an unincorporated association run by trustees for the benefit of investors (beneficiaries) · Cooperatives are groups of individuals or businesses that join together to gain the advantages of volume purchases or sales

Americans with Disabilities Act

A disabled person is someone with a physical or mental impairment that substantially limits a major life activity, or someone who is regarded as having such an impairment. An employer may not disqualify a job applicant or employee because of the disability as long as they can, with reasonable accommodation (would not create undue hardship) perform the essential functions of the job.

Partnership Dissociation

A dissociation occurs when a partner leaves the partnership, or rather quits. A dissociation does necessarily lead to the termination of the partnership. With dissociation, there are typically two courses the partnership can take: the partnership can either buyout the departing partner(s) and continue in the business or wind up the business and terminate the partnership.

Liability of Incoming Partners

A partner is personally liable only for obligations the partnership incurred while he was a partner. Her liability for debts incurred before she became a partner is limited to her investment in the partnership.

Wrongful Dissociation

A partner violates the partnership agreement. A partner in a term partnership withdraws before the end of the term. A court expels a partner in a term partnership because her behavior is harmful. A partner in a term partnership becomes bankrupt.

Rightful Dissociation

A partner, in a partnership at will, serves notice that she intends to withdraw. The partners agree in advance on an event that causes dissociation. A partner dies or becomes incompetent. A partner is expelled by the other partners.

Joint Venture

A partnership for a limited purpose Non profits cannot be joint ventures

General Partnership

A partnership is an unincorporated association of two or more co-owners who carry on a business for profit. Each co-owner is a general partner. · Unless otherwise agreed, partners share profits, losses, and management equally · Partnerships are easy to form (sometimes it happens unintentionally) O Remember, a morphing of a sole proprietorship to a partnership · Partners can be held personally liable for the partnership actions and debts · WORST TYPE OF BUSINESS ENTITY AND YET MOST POPULAR

Tort Liability

A partnership is responsible for the intentional and negligent torts of a partner that occur in the ordinary course of the partnership's business or with the actual authority of the partners.

Torts comitted by agent

A principal must indemnify an agent for tort claims brought by a third party if the principal authorized the agent's behavior and the agent did not realize he was committing a tort

Mark and Marissa form a partnership to make delicious chocolate treats, M & M candies. Marissa tells a customer that inside of one their "special" bags of M&M's there is the GOLDEN m&m, worth millions. But, in reality, there are no "golden" treats. a. The partnership is liable for this intentional misrepresentation because it occurred in the ordinary course of the partnership's business. b. The partnership is not liable because torts are not allocated to any partner but only their employees personally. c. The partnership may be liable under the theory of "res ipsa loquitor", which means that a partner and the partnership are liable for all torts committed in the ordinary course of business. d. The partnership is not liable because the customer should have known that there are no "golden" m&m's.

A. Misrepresentation is an intentional tort. The partnership is responsible for the intentional and negligent torts of a partner that occur in the ordinary course of the partnership's business or with the actual authority of the partners.

After graduation Anna convinces Alex and Ian to remain here in Blacksburg and open up a poodle grooming business. Alex and Ian each contribute $15,000. Anna has nothing to contribute financially. While vacationing in Hawaii, Ian meets a local. The local learns that Ian is a poodle groomer and asks if he would be willing to work his magic on her poodle, Francois. Ian agrees. The local is so pleased and insists that Ian accept a $1,000 for the coif. Ian figures the fee will go towards paying the cost of his vacation. a. Ian must turn the fee over to partnership because he earned doing the kind of work the partnership does. b. Ian does not have to turn over the fee because, even though he did the kind of work the partnership does, he was on vacation. c. Ian must turn over the fee because he knows that Anna and Alex would do the same; it's only fair. d. Ian does not have to turn over the fee because this is an exception to the UPA of sharing profits.

A. Partners owe a duty of loyalty to the partnership. Each partner must turn over to the partnership all earning from any activity that is related to the partnership's business. It is irrelevant that he was on vacation.

Agents are ________ liable for their own torts, even if the principal is also liable

ALWAYS

Fully disclosed principal

Agent is not liable for any contracts "I represent M and M and want to buy property"

Agents liability for torts

Agents and Principals are jointly and severally liable, which means the injured party may sue either one or both, as she chooses The injured party may NOT recover twice, but may recover partially from both parties The principal can sue the agent, if the injured party recovers from the principal

Partnership Debt

All partners are liable unless written in the contract

Authorization- scope of employment

An act is within scope of employment, even if expressly forbidden, if it is of the same general nature as that authorized or if it is incidental to the conduct authorized.

Information

As agent, a partner has a duty to pass on all relevant information. WHAT EVER ONE PARTNER KNOWS, THE PARTNERSHIP IS DEEMED TO KNOW.

Ratification

As with every agency relationship, partners can ratify unauthorized acts. If the partnership accepts the benefit of the unauthorized transaction or fails to repudiate it, the partnership has ratified it.

A corporate stockholder is entitled to which of the following rights? a. Elect officers. b. Receive annual dividends. c. Approve dissolution. d. Prevent corporate borrowing.

B. Officers are elected by the directors (who elects the board of directors?). Dissolution is determined by the directors and corporate borrowing.

After graduation Anna convinces Alex and Ian to remain here in Blacksburg and open up a poodle grooming business. Alex and Ian each contribute $15,000. Anna has nothing to contribute financially. But, Anna, does know Blacksburg. When the Anna's Poodle LUV business opens for business, she attracts incredible amounts of business. Meanwhile, Ian and Alex are working 20 hour days, first renovating the building and then clipping the numerous poodles. Anna rarely sees the dawn, or even noon. Alex and Ian contributed more time and money and may have done more the businesses success. It's at the end of their first year and the partnership has made $500,000 in profit because of Alex's and Ian's hard work. a. Alex and Ian are entitled to the return of their contribution as well as a more proportional share of the profits because if their hard work. b. The partners share the profits equally unless the three agreed otherwise. c. Under the UPA profits are divided by the amount of the investment; Ian and Alex contributed all the investment and will split the the profits equally. d. The partnership cannot split profits after one (1) year until all debts have been paid after the first 18 months, according to the UPA>

B. Partners share profits equally unless they have a Partnership Agreement that allocates the division of profits differently. Likewise, partners share losses according to their share of profits unless the Partnership Agreement allocates the division of losses differently.

Mark and Marissa form a partnership to make delicious chocolate treats, M & M candies. Mark, a well known partier, goes to TOTS one night. He gets in a fight with Alec on Saturday night. a. The partnership is liable for Mark's fight because it was agreed between the partners that all partnership actions would be controlled by the partnership agreement. b. The partnership is liable because everyone knows Mark fights at bars. c. The partnership is not liable because that had nothing to do with the partnership's business. d. The partnership is not liable because going to a bar and fighting is within the scope of the partnership's business as Mark was attempting to develop new clieants.

C. The partnership is responsible for the intentional and negligent torts of a partner that occur in the ordinary course of the partnership's business or with the actual authority of the partners. This action did not occur in the ordinary course of the partnership's business. DO NOT read in facts that are not there.

Close corporations

Corporation whose stock is not public Protection of minority shareholders Transfer restrictions Flexibility Dispute resolution

Kyle, the owner of the Hokie House, hires Alec as a bouncer for the club even though he knows that Alec has a history of arrests for criminal assault and battery. If Alec viciously attacks a customer in the parking lot after hours, then Kyle is: a. Kyle is the principal and Alec is the agent; b. Kyle maybe liable for the act; c. Kyle is NOT liable for the intentional tort by Alec; d. A and B.

D. Alec is the agent, so A is correct; B is also correct. An employer who knows or should knot that an employees has a propensity for committing tortious acts is liable for the employee's acts even if they would not ordinarily be considered within be considered within the scope of employment. Kyle is the Principal. The general rule is that in most intentional torts that individuals commit have no relation to their employment, and their employers will not be held liable. HOWEVER, the employer can be liable for intentional torts that an employee commits within the course and scope of employment; for example, if a bouncer at a nightclub commits the intentional tort of assault and battery while acting within the scope of employment (benefiting the employer).

Generally, a corporation's articles of incorporations must include all of the following except the: a. Name of the corporation's registered agent. b. Name of each incorporator/promoter. c. Number of authorized shares. d. Quorum requirements.

D. Typically, the Articles of Incorporation/Charter do not contain what a quorum would be for a corporate meeting (or some other corporate procedural event). You need to know what is the purpose of the registered agent; who the incorporator is (eg, Sierra of Sierra Mist, Incorporated, who wants to start the business would be the incorporator/promoter). Authorized shares are the number of stocks issued by the corporation.

Winding Up

During the winding up process, all debts of the partnership are paid, the remaining proceeds are distributed to the partners.

Whistleblowers

Employees who disclose illegal behavior of their employers are protected. The False Claims Act protects those who refuse to sign inaccurate reports. The Child Services Reform Act and the Whistleblower Protection Act protects Federal employees who report wrongdoings. The Sarbanes-Oxley Act of 2002 protects employees of publicly traded companies who provide evidence of fraud to investigators. In general, S-O raised financial standards in three main areas: Corporate governance Securities analysis Performance of audit work One of the most important goals of the Act is to ensure that company directors and officers are aware of and accountable for the financial condition of their companies they manage.

Defamation

Employers may be liable for defamation when they give false and unfavorable references about a former employee. More than half of the states recognize a qualified privilege (protection unless the statement is known false or given in ill will) for former employers who give references. Employers are generally not required to give any information about former employees, but may sometimes be held liable if potentially dangerous information is withheld.

A fiduciary relationship involves civility but not trust. T/F

False. A fiduciary duty is the utmost, the utmost, trust.

A corporate officer is not an agent for the corporation. T/F

False. Whether he/she is an employee, corporate officer or director, all are agents of the corporation. The corporation is the principal. Employees, Directors and Officers are all agents of the corporation. They each have a task under the control of the corporation, principal.

Limited v. General Partnerships

Have general (active management) and limited (money-only) partners. In a limited partnership, only the general partners are personally liable. Formation of limited partnerships require a filed certificate of limited partnership.

Partnership Agreement

However, in sharp contrast, the rules governing the relationship among partners is more flexible; the partners may alter many of them by a

Principal accepts benefits of the contract

If a person accepts the benefits of an unauthorized transaction or fails to repudiate it, the he is as bound by the act as if he had originally authorized it

What happens if whistleblower brings suit against company?

If a whistleblower successfully brings suit against a company that defrauds the government, the whistleblower can receive 30 percent of the damages awarded to the government.

Family and Medical Leave Act

In 1993, Congress passed the FMLA, which guarantees both men and women up to 12 weeks of UNPAID leave each year for childbirth, adoption, or medical emergencies for themselves or a family member. *Applies to companies with 50 or more employees Who does it apply to? EVERYONE

S corporation

Limited liability of a Corporation Tax status of partnership All of the companies profits and losses pass through shareholders

Does a partnership agreement need to be written?

NO

what is NRLA/what does it do?

National Labor Relations Act (Wagner Act) · Created by Labor Relations Board to enforce Labor Laws. Prohibits employers from penalizing workers who engage in union activity, and Requires employers to "bargain in good faith" with unions

LLC- Limited liability Corporation

Offers limited liability of Corporation and tax status of partnership, without disadvantages of S Corps Members ONLY risk their own investments Limited liability Favorable Tax status Duration Management Flexibility BIGGEST DISADVANTAGE: Legal uncertainty involved since it is a fairly new type of business

Disadvantages

One class of stocks No more than 100 Shareholders Shareholders cannot be partnerships or other Corps Shareholders must be U.S. Citizen or resident All shareholders must agree company will be S Corps

Partner Liability

Partners are liable to the partnership for gross negligence, reckless conduct, intentional misconduct, or knowing violation of the law. Partners are not liable for ordinary negligence.

Partnership Duty of Loyalty

Partners owe a duty of loyalty to the partnership. Each partner must turn over to the partnership all earning from any activity that is related to the partnership's business.

Factors must be true in Partnership

Partners share profits o Partners share management of the business o Partners usually share losses · Referring to yourself as partners does not create a partnership, but may be evidence that one was intended · Charitable businesses are not partnerships

Sharing Profits and Payment for Work Done

Partners share profits equally unless they have a Partnership Agreement that allocates the division of profits differently. This rule is sometimes hard to grasp because it may not seem fair. No matter how much money, time or effort an individual partner contributes to the partnership, the profits are split equally unless they have a Partnership Agreement, dividing the profits differently. Partners are not entitled to any payment beyond their share of profits unless they agree otherwise by the Partnership Agreement.

Partnership Authority

Partnership liability is based on their rules of agency law. Three types of authority: Actual, Implied and Apparent.

Fair Labor Standards Act

Passed in 1983, FLSA regulates wages (minimum wage and overtime pay) and limits child labor.

What is Equal dignity rule?

Principal and Agent agreement HAS to be in writing

Who CAN compete against who?

Principal can compete against agent

When is principle liable for physical torts of independant contractor

Principal has been negligent in hiring or supervising. Principals are only liable for torts that an agent commits within the scope of employment

wrongful discharge

Prohibits an employer from firing a worker for a bad reason. The public policy rule prohibits an employer from firing a worker for a reason that violates basic social rights, duties, or responsibilities, such as: Refusing to violate the law Exercising a legal right Performing a legal duty (like jury duty)

FACTORS IN DETERMINING WHAT BUSINESS IS RIGHT FOR YOU

Sources of financing Tax issues Liability concerns Entrepreneur's goals (public or not)

Employment law is based on _______

Statutory Law

COBRA

The Consolidated Omnibus Budget Reconciliation Act (COBRA) provides that former employees of companies with 20 or more employees must be allowed to continue their health insurance for 18 months after leaving their job. The catch is that employees must pay for it themselves, up to 102 percent of the cost. (the extra 2 percent covers administrative expenses).

Defamation statement by Agent to a 3rd party and the liability of the Principal. The principal is liable if:

The agent makes a defamatory statement The agent has express, implied, or apparent authority The third party is harmed by the statement

Misrepresentation of the Agent to a 3rd party and the liability of the Principal. Principal is liable if...

The agent makes misrepresentation The agent has express, implied, or apparent authority The third party relies on the misrepresentation; and The third party suffers harm

Disparate Treatment

The plaintiff must show evidence that the defendant discriminated based on a protected trait. Then the defendant must present evidence that the protected trait was not the reason for the disparate treatment.

disparate impact

The plaintiff must show evidence that the policy has a greater impact on the protected group than a non-protected group. The defendant must show that the policy is needed for the job.

Respondeat Superior****

The principal is responsible for the actions of the agent during the scope of employment Means: Let the master answer

Contracts entered into by the agent

The principal must indemnify (reimburse) the agent for liability she incurs as a result of a contract on the principal's behalf, including attorney's fees and reasonable settlements

Promoter's liability before contract formed

The promoter is personally liable on any contract signed before formation · The Corporation is not liable unless it adopts the contract after incorporation · Even if the corporation adopts the contract, the promoter is still liable....

Friedrichs v. California Teachers Association et al.

The suit claims state "agency shop" laws, which require public employees to pay union dues as a condition of employment, violate well-settled principles of freedom of speech and association The split decision effectively denied the parties a full decision on the merits, leaving existing laws in place in the twenty-three states that impose compulsory dues on public employees as a condition of employment.

Partially disclosed principal (unidentified)

Third party can recover from either the agent or the principal *Both parties will be jointly and severally liable

Termination

This happens automatically once the winding up is finished, the partnership is terminated. The partnership is not required to do anything official

True or False When Carson and Dakota agree to run the annual jamboree at Virginia Tech's Pamplin school of Finance, they expect to clear $35,000 after expenses, but they are not partners because their fund-raising has a charitable purpose.

True. Because charitable businesses do not technically make profits, they cannot be partnership.

In a standard principal-agent relationship, the principal has the right to control the actions of the agent. T/F

True. That's the whole point of an agency relationship. The principal controls the agent. My wife, PurEvil, asks Henry, "Will you mow my yard this Saturday, so that it will wake up my neighbors?" "Yes," says Henry. PurEvil wants it mowed on Saturday, not Monday, Tuesday, etc....

How does employment law apply to Contract Law?

Truth in hiring. Oral promises made during the hiring process can be enforceable. Remember, contract law and parol evidence rules and the statute of frauds. Employers may be liable for promises that they cannot keep or for failure to disclose important information in the hiring process. An employee handbook creates a contract. Covenant of Good Faith and Fair Dealing In some cases, courts will imply a covenant of good faith and fair dealing in an at-will employment contract.

Rights between partners under UPA

Under the UPA, each partner has the right to inspect and copy the partnership's books and records. All partners and the partnership have the duty to supply any other information that a partner reasonably request.

Relationship between partners and outsiders

Under the UPA,the rules governing the liability of partners to outsiders are MANDATORY

Governs partnerships

Uniform Partnership Act, comes into play if there is no contract or it does not decide the issue. UPA are default rules, they apply unless partners reach a diff agreement

Duty of Loyalty

YOU TELL AN AGENT A SECRET AND IT REMAINS ONE FOREVER!

abandonment

agent is liable for the actions of the servant that occur while the servant is at work, but NOT for the actions that occur after the servant has abandoned his master's business

apparent authority

agent seems to be authorized, BUT IS NOT. Principal is still bound by agents actions

Franchises

are business entities or organizations, which are a compromise between starting one's own business as an entrepreneur and working for someone else as an employee

detour

being on the way/still on the way. Servant and principal liable

Employment laws are forever....

changing because of new issues

Partnerships are grounded in what law?

common law

Agency Law is based on _______

common law (master-servant law)

What are the AGENT's liabilities to a contract?

depends on how much info the agent is allowed to divulge to the third party

You are on a job interview. What can't your interviewer ask you?

discriminating questions. Country of origin

most employees are....

employees at will. IF THEY DO NOT HAVE A CONTRACT

Workers' Compensation

employees receive payment for injuries incurred at work.

Partnerships need to be...

for PROFIT

Right to Work states

government regulation of the contractual agreement between employers and labor unions that prevents them from excluding non-union workers or requiring employees to pay a fee to unions that have negotiated the labor contract all the employees work under.

express authority

granted by words or conduct, that reasonably interpreted, cause the agent to believe the principal desires them to act -any ambiguity about the principal's intent, the courts look at the principal's objective manifestation not his subjective intent

Who files the articles of incorporation

in Virginia it would be the State Corporation Commission

A principal may be liable for the torts of an agent but generally is not liable for torts of an _________

independent Contractor

Key to corporation

limit the personal liability of the owners (i.e., shareholders) from liability either for a tortious, contractual or criminal liability/lawsuit.

B Corps

o Planet o People o Profit

The Electronic Communications Privacy Act of 1986 (ECPA)

permits employers to monitor workers' telephone calls, email, and even "instant message" if: The employee consents, The monitoring occurs in the ordinary course of business, or in the case of email, the employer provides the email system.

Unathorized agent

principal is not liable and agent is

The Age Discrimination in Employment Act (ADEA) of 1967

prohibits discrimination of those atleast 40 years old

De facto corporation

promoter has made a good faith effort to incorporate and has actually used the corporation to conduct business Ex. Someone does not want to go to law school, they end up going and opening a practice. M&Ms go to them telling them they want to incorporate. Lawyer takes all the info (Articles of incorporation are ALSO A CHARTER). Andrew the lawyer wants to be an accountant not a lawyer. He does not want to do the paperwork and lies to M&Ms and tells them that he has incorporated them when he indeed did not. M&Ms in good faith tried and believe they are right. It is defacto

De Jure corporation

promoter has substantially complied with the requirements for incorporation, but has made some minor error. · Ex. Get address wrong for filing corporation paper. Small typo. IT'S STILL A CORPORATION

Child Services Reform Act and the Whistleblower Protection Act

protects Federal employees who report wrongdoings.

Sarbanes-Oxley Act of 2002

protects employees of publicly traded companies who provide evidence of fraud to investigators. Raised financial standards in -corporate governance -securities analysis -performance of audit work

False claims act

protects those who refuse to sign inaccurate reports.

Discriminating factors

sex, race, color, religion, or national origin.

employment at will means

they can be fired for a good reason, bad reason or no reason

one of the most important goals of Sarbanes Oxely

to ensure that company directors and officers are aware of and accountable for the financial condition of their companies they manage.

implied authority

unless otherwise agreed, authority to conduct a transaction includes authority to do acts that are REASONABLY necessary to accomplish it

Principal Is NOT liable for intentional torts of agents UNLESS....

unless the agent/servant was motivated, at least in part, by the desire to serve the principal/master, or the conduct was reasonably foreseeable

Defamation and liability

with negligent conduct that causes non-physical harm (harm to reputation or finances), the principal is liable only if the servant acted with actual or apparent authority

More duties of agent to principal

· An agent must obey her principal's instructions, unless illegal or unethical · Agent must act with reasonable care · An agent with special skills is held to a higher standard because she is expected to use those skills · Agent must give accurate information · An agent has a duty to provide the principal with all information in her possession that she has reason to believe the principal wants to know