Chapter 16: Legal Guidelines and Business Considerations

personal trainers should always look for the following type of clause in their policy:

"We will have the right and duty to defend any suit seeking damages under this policy, even if the allegations are groundless, false, or fraudulent and may, at our discretion, make such investigation and settlement of any claim or suit deemed expedient"

ACE recommends retaining at least __________ in coverage, as medical expenses can easily cost in the hundreds of thousands

$1 million

to substantiate a charge of negligence in court, the plaintiff must establish four elements:

- the defendant has a duty to protect the plaintiff from injury -the defendant failed to uphold the standard of care necessary to perform that duty -damage or injury to the plaintiff occurred -the damage or injury was caused by the defendants breach of duty(proximate causation)

the following elements are necessary to create a binding contract:

-an offer and acceptance with a mutual agreement of terms -consideration(an exchange of valuable items such as money for services) -legality(acceptable under the law) -ability of the parties to enter into a contract with respect to legal age and mental capacity

Risk protocol 5 steps:

1. risk identification 2. risk evaluation 3. selection of an approach for managing risks(avoidance, transfer, reduction, retention) 4. implementation 5. evaluation

partnership

A business in which two or more persons agree to operate a business and share profits and losses

Contributory Negligence

A legal defense that may be raised when the defendant feels that the conduct of the plaintiff somehow contributed to any injuries or damages that were sustained by the plaintiff.

General supervision

A method of supervision where the worker (or trainee) does not require the constant attendance of the supervisor (or trainer)

Specific Supervision

A method of supervision where the worker (or trainee) requires direct involvement of the supervisor (or trainer)

implied partnership

A partnership lacking a written agreement, but in which the parties involved conduct business like a partnership

Comparative Negligence

A system used in legal defenses to distribute fault between an injured party and any defendant

two groups in America that issue licenses for the commercial use of broadcasts and recordings:

American Society of Composers, Authors, and Publishers(ASCAP) Broadcast Music, Inc(BMI) as well as Society of European Stage Authors and Composers(SESAC

Agreement to participate

Signed document that indicates that the client is aware of inherent risks and potential injuries that can occur from participation. should detail the nature of the activity, the potential risks to be encountered, and the expected behavior of the participant(follow instructions) have a process to formally warn cleints

Limited Liability Company

a company that limits investors personal financial and legal liabilities but provides flow-through taxation for investors. it is not limited to a certain number of shareholders and owners do not have to be US citizens

affiliate

a facility or business that is connected or attached to a larger organization or company

Statute of Limitations

a formal regulation limiting the period within which a specific legal action may be taken

growth hormone

a hormone, secreted by the pituitary gland, that facilitates protein synthesis in the body

Corporate Veil

a legal doctrine that shields individual investors ina corporation from financial or legal liability beyond their initial investment

Respondeat Superior

a legal doctrine wherein the actions of an employee can subject the employer to liability. Latin for let the master answer

corporation

a legal entity, independent of its owners and regulated by state laws; any number of people may own a corporation through shares issued by the business. are formed and registered in the office of the secretary of state in which the finbusiness operates.

minority partnerships

a partner holding less than 50% of the company's ownership shares

express partnership

a partnership created through formal paperwork

limited liability partnership

a partnership in which some or all partners(depending on the jurisdiction) have limited liability, exhibits elements of both partnerships and corporations

can use ACE trademarks in your marketing material, if you first include.....

a statement "ACE is a registered trademark of the American Council of Exercise"

general partnerships

a type of business arrangement in which each partner assumes management responsibility and unlimited liability and must have at least 1% interest in profit and loss

Franchise

a type of license that a part(franchisee) acquires to allow them to have access to a business's(franchiser) proprietary knowledge, processes, and trademarks in order to allow the part to sell a product or provide a service under the business's name

Waivers

a waiver has an exculpatory clause(bars the potential plaintiff from recovery). sometimes called a release

informed consent

a written statement signed by a client prior to testing that informs him or her of testing purposes, processes, and all potential risks and discomforts

the following liabilities are often excluded in exercise professionals policies:

abuse, molestation, cancer(from tanning), libel, and slander

a client must give explicit permission for the personal trainer to touch him or her, or else......

alternative exercises need to be utilized

Licensee

any business, organization, or individual that has been granted legal permission by another entity to engage in an activity

selection of an approach for managing risks

avoidance transfer-move the risk to waivers, insurance policies, etc reduction retention

all forms should be printed(not hand written) and signed by all clients _________ the first session.

before

Contracts

binding legal agreements

Sole Proprietorship

business owned and operated by one person

the main criteria the judicial system will utilize when addressing a potential complaint regarding independent contractor status is.....

control

Protected health information

demographic data, medical histories, test results, insurance information, and other information. any identifiable information

c- corporation

double taxation. highly unlikely for personal trainers good: limited liability and unlimited number of investors bad: cost of formation and operation

one of the most important things a personal trainer can do is.....

establish plans to regularly inspect facilities and equipment and review protocols regarding supervision and instruction

advice based solely on personal experience should be given with.....

express qualification

flow-through taxation

financial profits and losses flow from the business directly to investors. the business does not pay any taxes; rather, business profits are taxed on the investors individual tax return and losses can be utilized by the investors to offset other personal income

Independent Contractor

in most cases, personal trainers act as independent contractors. choose where and when to work. change variable fees for different situations. begin working without extensive guidance. maintain autonomy in training decisions. Do not assume that because a worker is called an independent contractor that they are actually acting as one or would be considered one in court.

it is critical that independent contractors working for fitness clubs or other facilities maintain adequate _________, as the facility's legal representatives would likely seek to separate the facility itself from the actions of the trainer if a lawsuit occurs

insurance

keyman insurance

insurance that compensates a company for the loss of a representative of the company who was performing unique and valuable functions

Umbrella Liability Policy

insurance that provides additional coverage beyond other insurance such a professional liability, home, automobile, etc

professional liability insurance

insurance to protect a personal trainer against professional negligence or failure to perform as a competent and prudent professional would under similar circumstances

liability

legal responsibility

Vicarious Liability

legal term meaning that employers are responsible for the workplace conduct of their employees

it is important for the personal trainer to have a completed......

lifestyle and health-history questionnaire

policies that only cover an amount equal to the awarded damages are....

not recommended.

limited partnership

only liable for their direct financial contribution. a limited partner who owns 70% of the organization still does not have any formal input into the company's operation but is entitled to 70% of the company's profits

when collecting information from witnesses, it is critical to get....

phone numbers, email addresses, physical addresses, and signatures for future verification and follow up

Health Insurance Portability and Accountability Act (HIPAA)

protected health information

Statue of Frauds

requires certain contracts to be in writing. especially when over services worth $500 or morea

inherent risks

risks that can occur through normal participation in the stated activity inherent risks can only be avoided by declining to participate

the vast majority of for-profit businesses in the US operate as what?

sole proprietorships

Rider

specific additions to a standard insurance policy

trainers can tell a client that certain foods have a high amount of a certain vitamin or minerals, but not......

telling them what specific foods to eat

When training clients in their homes, who should provide the music?

the client

a registered agent

the contact person in the event a lawsuit is filed against a corporation

double taxation

the imposition of taxation on corporate earnings at both the corporate level and again as a stockholder dividend only in c-corp

What should clearly define and explain the structure for authority, the partners rights, expected performance and contributions from each partner, buy-out clauses, income distribution, and responsibility of debts?

the legal agreement

When have you created a business?

the moment you begin providing advice in exchange for financial considerations

Subchapter S Corporation

the most typical type of corporation used by personal-training businesses that do not operate as a sole proprioritorship or partnership. good: flow through taxation and limited liability bad: limited number of investors and costs of formation and operation must be based in the US, upt o 100 investors-all from US

Product Liability Insurance

this is particularly important for personal trainers who own and operate fitness centers.

a personal trainer should never leave a client during a session

true

as consistent guidelines regarding LLCs and LLPs are established they will likely become the preferred operating structures for personal trainers.

true

do not assume that ant piece of equipment particularly an AED or other life-saving device is ready for use. Always regularly inspect and maintain equipment so it is ready to use.

true

do not open a personal training business without first consulting with an attorney who understands the fitness industry and its unique legal standing in our state.

true

if outside consultation is deemed by the personal trainer to be necessary, he or she should obtain written permission from the client.

true

if the training sessions will be conducted outdoors, the personal trainer should provide water in containers that will be sufficient for the time, intensity, and temperature during the workout

true

in some jurisdictions it is illegal to train clients on public beaches, parks, or trails. it is the personal trainer's responsibility to know the local prior to using these areas.

true

it is critical that investors in a corporation do not act as the corporation or the corporate veil may be pierced.

true

one potential consideration for each of these documents is a general request, or in some cases a requirement, that participants consult with a doctor prior to beginning any exercise routine. This process is particularly important if vigorous-intensity exercise is to be performed.

true

personal trainers may administer fitness assessments if they are recognized by a professional organization as appropriate for the intended use and are within the scope of a personal trainers qualifications and training

true

personal trainers should develop contingency plans(outside of cancelling the session and losing potential revenue) for unsafe facilities

true

personal trainers should insist upon a written contract not only with clients, but also with fitness centers, vendors, and any other entities with which they conduct business

true

regular maintenance should be logged and records retained for future referral in the event of a lawsuit

true

strict safety guidelines for each activity, accompanied by procedures for emergencies, are particularly important

true

though some states permit group waivers that have a list of spaces for multiple patrons to sign below the waiver, it is advisable to have a stand-alone document for each client.

true

the following statement or something similar should be included in any basic agreement.

we agree to pay those sums that the insured becomes legally obligated to pay as damages because of bodily injury or property damage to which this insurance applies, and these will include damages arising out of any negligent act, error, or omission in rendering or failing to render professional services described in this policy

Ultimately, when is a partnership dissolved?

when the business cannot make money