Chapter 16 BLAW

liabilty facts

- A principal may be liable for giving improper instructions, authorizing the use of improper materials or tools, or establishing improper rules that resulted in the agent's committing a tort.

The Labor-Management Reporting and Disclosure Act (LMRDA)

- The act strictly regulates unions' internal business procedures, including union elections. - the LMRDA requires a union to hold regularly scheduled elections of officers using secret ballots. - The act also outlawed hot-cargo agreements: An illegal agreement in which employers voluntarily agree with unions not to handle, use, or deal in the nonunion-produced goods of other employers.

1. agent 2. Principal

1. A person authorized by another to act for or in place of him or her. 2. A person who, by agreement or otherwise, authorizes an agent to act on his or her behalf in such a way that the acts of the agent become binding on the principal.

criteria determined by the courts to see if someone is an employee of not

1. How much control can the employer exercise over the details of the work? if they can control a lot, they are an employee 2. Is the worker engaged in an occupation or business distinct from that of the employer? (If so, this points to independent-contractor status) 3. Is the work usually done under the employer's direction or by a specialist without supervision? (If the work is usually done under the employer's direction, this would indicate employee status.) 4. Does the employer supply the tools at the place of work? (If so, this would indicate employee status.) 5. For how long is the person employed? (If the person is employed for a long period of time, this would indicate employee status.) 6. What is the method of payment—by time period or at the completion of the job? (Payment by time period, such as once every two weeks or once a month, would indicate employee status.) 7. What degree of skill is required of the worker? (If little skill is required, this may indicate employee status.)

determining the scope of employment for respondiat superior

1. Whether the employee's act was authorized by the employer. 2. The time, place, and purpose of the act. 3. Whether the act was one commonly performed by employees on behalf of their employers. 4. The extent to which the employer's interest was advanced by the act. 5. The extent to which the private interests of the employee were involved. 6. Whether the employer furnished the means or instrumentality (such as a truck or a machine) by which the injury was inflicted. 7. Whether the employer had reason to know that the employee would do the act in question and whether the employee had ever done it before. 8. Whether the act involved the commission of a serious crime.

Principal duties to Agent

1. compensation: The principal therefore has a duty to pay the agent for services rendered in a timely manner. ex: Keith Miller worked as a sales representative for Paul M. Wolff Company, a subcontractor specializing in concrete finishing services. Sales representatives at Wolff are paid a 15 percent commission on projects that meet a 35 percent gross profit threshold, after the projects are completed and Wolff is paid. When Miller resigned, he asked for commissions on fourteen projects for which he had secured contracts. Wolff refused, so Miller sued. The court found that "an agent is entitled to receive commissions on sales that result from the agent's efforts," even after the employment or agency relationship ends. Miller had met the gross profit threshold on ten of the unfinished projects, and therefore he was entitled to more than $21,000 in commissions. (The court also awarded Miller nearly $75,000 in attorneys' fees and court costs.) 2. Reimbursement and Indemnification: Sometimes an agent disburses funds at the request of the principal or to pay for necessary expenses in the reasonable performance of his or her agency duties. Whenever that happens, the principal has the duty to reimburse the agent for these payments. Subject to the terms of the agency agreement, the principal has the duty to compensate, or indemnify, an agent for liabilities incurred because of authorized and lawful acts and transactions. For instance, if the principal fails to perform a contract formed by the agent with a third party and the third party then sues the agent, the principal must compensate the agent for any costs incurred in defending against the lawsuit. 3. cooperation: A principal has a duty to cooperate with the agent and to assist the agent in performing her or his duties. The principal must do nothing to prevent that performance. When a principal grants an agent an exclusive territory, for instance, the principal creates an exclusive agency and cannot compete with the agent or appoint or allow another agent to so compete. If the principal does so, she or he may be liable for the agent's lost sales or profits. ex: River City Times Company (the principal) grants Emir (the agent) the right to sell its newspapers at a busy downtown intersection to the exclusion of all other vendors. This creates an exclusive territory within which only Emir has the right to sell those newspapers. If River City Times allows another vendor to sell its papers on another corner of the same intersection, Emir can sue for lost profits. 4. safe working conditions

agent's authority

1. express authority: Express authority is authority declared in clear, direct, and definite terms. Express authority can be given orally or in writing 2. implied authority: to do what is reasonably necessary to carry out his or her express authority and accomplish the objectives of the agency. ex: Mueller is employed by Al's Supermarket to manage one of its stores. Al's has not expressly stated that Mueller has authority to contract with third persons. In this situation, though, authority to manage a business implies authority to do what is reasonably required (as is customary or can be inferred from a manager's position) to operate the business. A manager's implied authority typically includes forming contracts to hire employees, to buy merchandise and equipment, and to advertise the products sold in the store. 3. apparent authority: when the principal, by either words or actions, causes a third party reasonably to believe that an agent has authority to act, even though the agent has no express or implied authority. ex: The owner a horse breeding farm in Illinois, Gilbert Church, advertised that persons interested in breeding rights to one of its stallions, Imperial Guard, should contact his farm manager Herb Bagley. Vern and Gail Lundberg contacted Bagley and signed a contract giving them breeding rights to Imperial Guard "at Imperial Guard's location." Bagley handwrote a statement on the preprinted contract guaranteeing the Lundbergs "six live foals in the first two years" and signed it "Gilbert G. Church by H. Bagley." Later, after the Lundbergs had bred four mares and received one live foal, Church moved Imperial Guard from Illinois to Oklahoma. The Lundbergs sued Church for breaching the contract by moving the horse. Church claimed that Bagley was not authorized to sign contracts for Church or to change or add terms, but the court held that Bagley had apparent authority to execute the contract. Because Church allowed circumstances to lead the Lundbergs to believe Bagley had the authority, Church was bound by Bagley's actions so bagley in this situation was the supposed agent. he acted like one and made decisions as if her were one. he acted as the agent for Church even though this relationship was never talked about. when Church got sued they said Bagley was never their agent and had no right to sign on their behalf... but bagley was found to have apparent authority bc Church let him make the Lundbergs beleive that he had this kind of power. so church became the prinicpal automatically.

Agent's Duties to the Principal

1. performance: An implied condition in every agency contract is the agent's agreement to use reasonable diligence and skill in performing the work. When an agent fails entirely to perform her or his duties, liability for breach of contract normally will result. 2. notification: An agent is required to notify the principal of all matters that come to her or his attention concerning the subject matter of the agency. This is the duty of notification, or the duty to inform. ex: Lang, an artist, is about to negotiate a contract to sell a series of paintings to Barber's Art Gallery for $25,000. Lang's agent learns that Barber is insolvent and will be unable to pay for the paintings. The agent has a duty to inform Lang of this fact because it is relevant to the subject matter of the agency—the sale of Lang's paintings. 3. loyalty: Basically, the agent has the duty to act solely for the benefit of his or her principal and not in the interest of the agent or a third party. For instance, an agent cannot represent two principals in the same transaction unless both know of the dual capacity and consent to it. being confidential is also part of this ex: Don Cousins contracts with Leo Hodgins, a real estate agent, to negotiate the purchase of an office building. While working for Cousins, Hodgins discovers that the property owner will sell the building only as a package deal with another parcel, so he buys the two properties, intending to resell the building to Cousins. Hodgins has breached his fiduciary duties. As a real estate agent, Hodgins has a duty to communicate all offers to his principal and not to purchase the property secretly and then resell it to his principal. Hodgins is required to act in Cousins's best interests and can become the purchaser in this situation only with Cousins's knowledge and approval. 4. obedience: When acting on behalf of a principal, an agent has a duty to follow all lawful and clearly stated instructions of the principal. Any deviation from such instructions is a violation of this duty. During emergency situations, however, when the principal cannot be consulted, the agent may deviate from the instructions without violating this duty. 5. accounting: Unless an agent and a principal agree otherwise, the agent has the duty to keep and make available to the principal an account of all property and funds received and paid out on behalf of the principal. This includes gifts from third parties in connection with the agency. For instance, a gift from a customer to a salesperson for prompt deliveries made by the salesperson's firm, in the absence of a company policy to the contrary, belongs to the firm. The agent has a duty to maintain separate accounts for the principal's funds and for the agent's personal funds, and the agent must not intermingle these accounts.

union shop LMRA

A firm that requires all workers, once employed, to become union members within a specified period of time as a condition of their continued employment.

closed shop LMRA

A firm that requires union membership by its workers as a condition of employment, which is illegal.

disclosed principal:

A principal whose identity is known to a third party at the time the agent makes a contract with the third party.

undisclosed principal

A principal whose identity is unknown by a third party, and that person has no knowledge that the agent is acting for a principal at the time the agent and the third party form a contract. the agent is liable, so they will get sued and they will get reimbursed or indemnified by their principal

partially disclosed principal

A principal whose identity is unknown by a third party, but the third party knows that the agent is or may be acting for a principal at the time the agent and the third party form a contract. ex: Sarah has contracted with a real estate agent to sell certain property. She wishes to keep her identity a secret, but the agent makes it clear to potential buyers of the property that the agent is acting in an agency capacity. In this situation, Sarah is a partially disclosed principal.

agency

A relationship between two parties in which one party (the agent) agrees to represent or act for the other (the principal). In an agency relationship between two parties, one of the parties, called the agent, agrees to represent or act for the other, called the principal. Agency is a "fiduciary" relationship based on trust and confidence.

4. by operation of law

Agency by operation of law may also occur in emergency situations, when the agent's failure to act outside the scope of his or her authority would cause the principal substantial loss. If the agent is unable to contact the principal, the courts will often grant this emergency power. For instance, a railroad engineer may contract on behalf of her or his employer for medical care for an injured motorist hit by the train.

formation of agencies

Agency relationships normally are consensual.. A person must have contractual capacity to be a principal. Any person can be an agent, though, regardless of whether he or she has the capacity to enter a contract (including minors). It is also illegal for physicians and other licensed professionals to employ unlicensed agents to perform professional actions. Generally, an agency relationship can arise in four ways: by agreement of the parties, by ratification, by estoppel, or by operation of law.

strikes

An action undertaken by unionized workers when collective bargaining fails. The workers leave their jobs, refuse to work, and (typically) picket the employer's workplace.

liabilities for agent's crimes

An agent is liable for his or her own crimes. In some jurisdictions, under specific statutes, a principal may be liable for an agent's violation—in the course and scope of employment—of regulations, such as those governing sanitation, prices, weights, and the sale of liquor.

employer- employee relationship

An employee is one whose physical conduct is controlled, or subject to control, by the employer. Normally, all employees who deal with third parties are deemed to be agents. ex: Kayla, a salesperson in a department store, is an agent of the store (the principal) and acts on the store's behalf. Any sale of goods Kayla makes to a customer is binding on the store. Similarly, most representations of fact made by Kayla with respect to the goods sold are binding on the store.

Violations of the FMLA

An employer that violates the FMLA can be required to provide various remedies, including the following: 1. Damages to compensate an employee for lost benefits, denied compensation, and actual monetary losses (such as the cost of providing for care of the family member) up to an amount equivalent to the employee's wages for twelve weeks (twenty-six weeks for military caregiver leave). 2. Job reinstatement. 3. Promotion, if a promotion has been denied.

ex: of undisclosed

Bobby Williams bought a car at Sherman Henderson's auto repair business in Monroe, Louisiana, for $3,000. Henderson negotiated and made the sale for the car's owner, Joe Pike, whose name was not disclosed. Williams drove the car to Memphis, Tennessee, where his daughter was a student. Three days after the sale, the car erupted in flames. Williams extinguished the blaze and contacted Henderson. The vehicle was soon stolen, which prevented Williams from returning it to Henderson. Williams later filed suits against both Pike and Henderson. The court noted that the state had issued Pike a permit to sell the car. The car was displayed for sale at Henderson's business, and Henderson actually sold it. This made Pike the principal and Henderson his agent. The fact that their agency relationship was not made clear to Williams made Pike an undisclosed principal. Williams could thus hold both Pike and Henderson liable for the condition of the car.

Liability for Independent Contractor's Torts

Generally, an employer is not liable for physical harm caused to a third person by the negligent act of an independent contractor in the performance of the contract. This is because the employer does not have the right to control the details of an independent contractor's performance.

Employer-Independent Contractor Relationships

Independent contractor is not an employee because employer does not have control over their physical performance. One who works for, and receives payment from, an employer but whose working conditions and methods are not controlled by the employer. An independent contractor is not an employee but may be an agent. ex: Brooke, an owner of real estate, hires Tom, a real estate broker, to negotiate a sale of property. Brooke has contracted with Tom (an independent contractor) and has established an agency relationship for the specific purpose of assisting in the sale of the property. In contrast, Henry, an owner of real estate, hires Millie, an appraiser, to estimate the value of his property. Henry does not control the conduct of Millie's work. Henry has contracted with Millie, an independent contractor, but he has not established an agency relationship. Millie has no power to transact any business for Henry and is not subject to his control with respect to the conduct of her work.

liability for contracts

Liability for contracts formed by an agent depends on how the principal is classified and on whether the actions of the agent were authorized or unauthorized. Principals are classified as disclosed, partially disclosed, or undisclosed.

medicare

Medicare is a federal government health-insurance program that is administered by the Social Security Administration for people sixty-five years of age and older and for some under the age of sixty-five who are disabled.

1. agreement of the parties

Most agency relationships are based on an express or implied agreement that the agent will act for the principal and that the principal agrees to have the agent so act. An agency agreement can take the form of an express written contract or be created by an oral agreement. can also be implied by conduct Gilbert Bishop was admitted to Laurel Creek Health Care Center suffering from various physical ailments. During an examination, Bishop told Laurel Creek staff that he could not use his hands well enough to write or hold a pencil, but he was otherwise found to be mentally competent. Bishop's sister, Rachel Combs, offered to sign the admissions forms, but it was Laurel Creek's policy to have the patient's spouse sign the admissions papers if the patient was unable to do so. Therefore, Gilbert asked Combs to get his wife, Anna, so that she could sign his admissions papers. Combs then brought Anna to the hospital, and Anna signed the admissions paperwork, which contained a provision for mandatory arbitration. Later, the Bishops sued the hospital for negligence, and Laurel Creek sought to compel arbitration. The Bishops argued that Anna was not Bishop's agent and had no legal authority to make decisions for him, but the court concluded that an agency relationship between Bishop and his wife, Anna, had been formed by conduct.

Liability for Agent's Intentional Torts

Most intentional torts that employees commit have no relation to their employment. Thus, their employers will not be held liable. For instance, an employer is liable when an employee (such as a "bouncer" at a nightclub or a security guard at a department store) commits the tort of assault and battery or false imprisonment while acting within the scope of employment. example of respondiat superior: the principal(owner of club) is liable for the agent(bouncer) bc they hired them

workers' compensation laws OSHA

State statutes that establish an administrative process for compensating workers for injuries that arise in the course of their employment, regardless of fault. 2 requirements: 1. The existence of an employment relationship. 2. An accidental injury that occurred on the job or in the course of employment, regardless of fault. (An injury that occurs while an employee is commuting to or from work usually is not considered to have occurred on the job or in the course of employment and hence is not covered.) An injured employee must notify her or his employer usually within thirty days of the accident.

social security

The Social Security Act provides for old-age (retirement), survivors', and disability insurance. the act is aka OASDI

National Labor Relations Act

The act also specifically defined a number of employer practices as unfair to labor: 1. Interference with the efforts of employees to form, join, or assist labor organizations or to engage in concerted activities for mutual aid or protection. 2. An employer's domination of a labor organization or contribution of financial or other support to it. 3. Discrimination in the hiring or awarding of tenure to employees based on union affiliation. 4. Discrimination against employees for filing charges under the act or giving testimony under the act. 5. Refusal to bargain collectively with the duly designated representative of the employees. ex: Roundy's, Inc., which operates a chain of stores in Wisconsin, became involved in a dispute with a local construction union. When union members started distributing "extremely unflattering" flyers outside the stores, Roundy's ejected them from the property. The NLRB filed a complaint against Roundy's for unfair labor practices. An administrative law judge ruled that Roundy's had violated the law by discriminating against the union, and a federal appellate court affirmed. It is an unfair labor practice for an employer to prohibit union members from distributing flyers outside a store when it allows nonunion members to do so

Criteria Used by the Internal Revenue Service to see if someone is an employee or not

The most important factor in this determination is the degree of control the business exercises over the worker. The IRS tends to closely scrutinize a firm's classification of its workers because employers can avoid certain tax liabilities by hiring independent contractors instead of employees.

3. agency by estoppel

When a principal causes a third person to believe that another person is his or her agent, and the third person deals with the supposed agent, the principal is "estopped to deny" the agency relationship. In such a situation, the principal's actions create the appearance of an agency that does not in fact exist. The third person must prove that she or he reasonably believed that an agency relationship existed, though. principal has to prove that they didn't know that they weren't dealing with this agent. the principal is estopped to deny the agency relationship.

family and medical FMLA

allows employees to take time off of work for family or medical reasons - if you have 50 or more employees, you have to provide employees with 12 weeks unpaid leave. have to work for a 1 year - taking care of cousin or aunts for medical leave is not allowed. - military- 26 weeks - employees get the same health coverage even when they're done - when employees come back, they get their same job back

when unions are form they engage in,

collective bargaining: The process by which labor and management negotiate the terms and conditions of employment, including working hours and workplace conditions. -Bargaining does not mean that one side must give in to the other or that compromises must be made. It does mean that a demand to bargain with the employer must be taken seriously and that both sides must bargain in "good faith."

HIPPA

employer cant reveal anything in your records that are health related are confidential. HIPAA does not require employers to provide health insurance, but it does establish requirements for those that do provide such coverage. For instance, HIPAA strictly limits an employer's ability to exclude coverage for preexisting conditions, except pregnancy.

FLSA- The Fair Labor Standards Act

extended wage-hour requirements to cover all employers engaged in interstate commerce or in producing goods for interstate commerce, plus selected other types of businesses. The FLSA, as amended, provides the most comprehensive federal regulation of wages and hours today. prohibits opressive child labor: - under 14, you can't work, except in entertainment -age 14-15 you can work but it can't be hazardous and there's a time limit -16-18 no restriction on time, but it still can't be hazardous -guarantees minimum wage $7.25 - overtime 1.5 only for jobs that pay hourly -Certain employees—usually executive, administrative, and professional employees, as well as outside salespersons and computer programmers—are exempt from the FLSA's overtime provisions. ex: jenny wants to work at 16 so its legal if its not hazardous

determining employee status

he courts are frequently asked to determine whether a particular worker is an employee or an independent contractor

OSHA

legislation protecting employees' health and safety in the workplace. -prevents employers from firing employees who tell them that their workplace isn't safe. employers post certain notices in the workplace, perform prescribed record keeping, and submit specific reports. For instance, employers with eleven or more employees are required to keep occupational injury and illness records for each employee

COBRA

lost your job, you get cobra coverage (health care coverage)

disclosed or partially disclosed

principal is liable

lie detector tests

prohibits employers from requiring employees or job applicants to take lie-detector tests or suggesting or requesting that they do so. The act also restricts employers' ability to use or ask about the results of any lie-detector test or to take any negative employment action based on the results. Certain employers are exempt from these prohibitions. Federal, state, and local government employers, and certain security service firms, may conduct polygraph tests.

Norris LaGuardia act

protects peaceful strikes, picketing (sitting at your job and refusing to work), and boycotts

The Federal Unemployment Tax Act (FUTA)

provides compensation for people who have lost their jobs. eligible: able and willing to work, not eligible: ppl who were fired or quit on their own will not be getting unemployment insurance

drug testing

public: employers can't search you or give you tests unless you're a driver. private: employers can

2. by ratification

ratification: A party's act of accepting or giving legal force to a contract or other obligation entered into by another that previously was not enforceable. Ratification involves a question of intent, and intent can be expressed by either words or conduct. ex: You are my agent and you go outside of the scope of the agreement but I agree to it afterwards.

Employee Retirement Income Security Act (ERISA)

regulates employee retirement plans. govern employers that have private pension funds for their employees. vesting: Vesting gives an employee a legal right to receive pension benefits at some future date when he or she stops working.

liabilities for torts and crimes

respondeat superior: A doctrine under which a principal or an employer is held liable for the wrongful acts committed by agents or employees while acting within the course and scope of their agency or employment. vicarious liability: Indirect liability imposed on a supervisory party (such as an employer) for the actions of a subordinate (such as an employee) because of the relationship between the two parties.