Accounting 215 Chapter 13
Americans With Disabilities Act
ADA Includes blindness, alcoholism, cancer, cerebral palsy, paraplegia, diabetes, AIDS -Kleptomania is not included Supreme Court previously limited this list by stating the person's life activities must be limited while they are on medication not while they are not. Congress passed a statutory amendment to change this ruling. To be considered a disability, major life activities must be impaired. Examples: seeing, walking, hearing or sitting. Limiting a person's ability to do a single task as op posed to major life activities does not suffice Example: carpal tunnel syndrome is not considered a disability because it does not substantially limit the major life activities of performing manual tasks Employers must make reasonable accommodations as long as it is not an economic hardship
Employment Hypos
Annabelle is an employee at a restaurant. She is paid by the hour. She can be let-go for any reason at any time. Is this likely an at-will employment arrangement? At-Will Julie is a marketing representative with North Company. Her employment contract was originally for one year. She has now been with the company for five years and her original contract was never renegotiated. At-will? No, the presumption is that a fixed term contract is not an at-will contract.
UAW v. Johnson Controls
Johnson Controls Inc prohibited women from working in their battery division unless a woman could prove she was unable to bear children Companies intent was to prevent pregnant women from working in the battery division because of fears of birth defects The Supreme Court held this was impermissible gender discrimination under the Pregnancy Discrimination Act of 1978
Discrimination Hypo
Luis has a Guatemalan themed restaurant. He serves traditional Guatemalan dishes which his grandmother taught him to make. Luis only wants to hire Guatemalan employees. Can he do this under the Civil Rights Act of 1964? No he cannot discriminate by race or national origin unless he has less than 15 employees
Discrimination Hypo
Monica recently was interviewed for a job. She told the person interviewing her that she spoke Spanish as her primary language. The interviewer then said he "thought schools in the US should be English only." Monica was not offered the job. Was she unlawfully discriminated against under Title 7 of the Civil Rights Act of 1964? It would need to be investigated if any of the people who were hired spoke spanish as their primary language.
Torosyan v. Boehringer Ingelheim Pharmaceuticals
Mr. Torosyan was hired by Boehringer as a chemist. Mr. Torosyan was wrongfully accused by supervisors of submitting false expense reports Mr. Torosyan was fired without cause Trial court found an implied-in-fact contract existed. The appellate court found the words "just do a good job and Boehringer will take care of you" constituted the potential basis for an express employment contract which was not at-will
Genetic Information Discrimination
Genetic Information Nondiscrimination Act of 2008 prohibits employers from making employment related decisions based upon genetic information Insurance companies cannot obtain this information for purposes of a group health plan either In 2013, Fabricut Corporation settled with the EEOC because a job applicant was asked for her medical history as part of a physical. The applicant had disclosed that she had carpal tunnel syndrome
Pensions and Retirement
Governed by ERISA (Employee Retirement Income Security Act) Defined contribution plan - employer contributes a set amount of money to the retirement plan Example: tax deferred 401(k) Defined benefit plan - employer promises a set amount of benefit upon retirement Vesting - means requirements have been met such that the employee is guaranteed benefits under the employer's pension plan
Harrasment
Types of harassment Quid pro quo - this for that A raise in exchange for enduring offensive behavior based upon membership in a protected class -Example: pay raise for sexual favor Hostile Work Environment Workplace becomes intolerable because of harassment Single incident is not enough -Example: constant jokes about the faith of a coworker Harassment by supervisors Need a tangible employment action for employer to be held liable for quid pro quo sexual harassment to create liability for the employer -Example, manager refuses to give a raise because the employee would not perform sexual act Company can be responsible for a hostile work environment unless 1) Employer tried to prevent harassment 2) Employee suing for harassment did not follow the employer's remedies and policies Non supervisor employees, independent contractors and customers can create liability for employer if the employer knew of harassment and did not take steps to prevent harassment
Age Discrimination
Age Discrimination in Employment Act of 1967 protects those age 40 and over from employment decisions based upon their age State law may protect a larger range of ages such as 30 and over Employees have the ability to waive their rights. Older Workers Benefit Protection Act of 1990 prevents employers from providing a difference in benefits such as severence because of the age of the affected employees. An Example: Gilbert is 67 years old and applies for a job at Quick Decision Corp. Quick denies his employment application and hires patricia who is only 43. Gilbert has faced an adverse employment decision based upon his age and he has a claim under the Age Discrimination Employment Act.
Disability Discrimination
Americans with Disabilities Act of 1990 protects those with certain disabilities from discrimination in the context of employment One is protected if they previously had the disability, currently have it, or are perceived as having it A disability is defined as 1) a physical or mental impairment that substantially limits one one or more major activities of an individual. 2) the impairment has been documented 3) the impairment is ongoing.
Employee Privacy rights
Employees have an expectation of privacy Employer can monitor the employee's communication as a general rule as long as the employer provides notice of the activity Electronic communication generally carries with it no expectation of privacy Employees cannot be fired for having their wages garnished- wages being paid to a creditor As a general rule, employers (other than certain government organizations) cannot require an employee to take a lie detector test Drug Testing -Not allowed for most government agencies -Exception for transportation workers -Allowed for private employers -State law varies
Gender Discrimination
Cannot base employment decisions based upon gender. Exception made if gender is a key element of the job -at a Women's Shelter employees must be female Bona Fide Occupational Qualification (applies to more than just gender cases) - have to prove the protected class could effectively meet the demands of the job Equal Pay Act of 1963 prohibits employers from paying male and female workers differently for the same job duties Some states protect marital status as a protected class for employment related decisions Anti-nepotism policies are policies which prohibit the hiring of family members and these are allowed Why would a company have an anti-nepotism policy? To avoid favoritism towards a spouse
Social Security and Medicare
Employers and employees contribute money under the Federal Insurance Contributions Act to the Social Security Administration for retirement benefits and medical coverage Once reaching the required age (65), an employee is entitled to receive payments and coverage Covers disabled individuals as well as the retired Contributions are only required to be paid on a certain amount of wages for social security benefits (same is not true for Medicare premiums)
Griggs v. Duke Power
Duke Power Co had been intentionally discriminating against African Americans After the passage of the Civil Rights Act of 1964, the company implemented the requirement of a high-school diploma to prevent African Americans from gaining employment Supreme Court state the requirement of a diploma was unintentionally discriminating against African American applicants
Disparate Discrimination Aftermath
EEOC may look at "Rates of Hiring" Certain practices may exclude a high percentage of a protected class from being hired EEOC often looks to see if at least 80% of the protected class was represented in the final hiring class as compared to others -Example: Nadia is from the fictitious country of Ranshana. A large group of people from her country have moved into the surrounding area. If 100 applicants apply and 50 are hired with German descent, the EEOC would multiply 50 * .80 to see if at least 40 employees were from the protected group.
Unemployment Compensation
Each state maintains an unemployment compensation fund Federal government maintains an unemployment compensation fund as well Only employers contribute (not employees) Cannot be eligible if employee leaves their job without good cause or if the employee is fired Amount of tax depends on how many people become unemployed through a business. if large amount of people claim unemployment from a business that businesses tax will be higher.
At Will Employment
Employee can be fired at anytime without liability for any reason except: -Implied contract exists and applies to the current arrangement -Tort was committed by employer as part of the firing -Examples: defamation or fraud -Public policy reasons -Example would be non protected class or if federal discrimination law does not apply to the employer -Whistle blowers are often protected Wrongful discharge of employee by employer is grounds for a lawsuit Presumption under state law is that employee is generally an at-will employee If an employment contract is not at-will then the employer needs to provide notice of grounds for termination. These will often by found in the employment agreement. Fixed term contracts can still be at-will but the presumption might be that the fixed term employment is not at will.
EEOC
Equal Employment Opportunity Commission. -Enforces compliance with Title VII of the Civil Rights Act of 1964 -Before bringing initiating an employment lawsuit claim based on discrimination, an employee must generally file a claim first with the EEOC -If the EEOC does not pursue the matter, then the employee can file suit on their own behalf EEOC-a federal agency that enforces federal law governing work place discrimination based upon a person's race,religion, sex, pregnancy, age, national origin, color, disability, or genetic information
Fair Labor Standards Act of 1938
FLSA, a covered employee is required to be paid the federal minimum wage per hour. If an employee works more than 40 hours in a work week, the employee must be paid time and one-half for each hour over 40. Workers exempt from overtime pay and minimum wage requirements are salaried employees Provides also for... Minimum wage for those in covered industries Exempted employees include most professionals, white collar workers who make more than 100k a year, and managers
Family Medical Leave Act
FMLA applies to employers of 50 of more employees Grants employees up to 12 weeks of time off during a twelve month period if the absence is tied to pregnancy, adoption or sickness of employee or family member Employer must maintain making health insurance coverage payments and must keep employees job available Paid or unpaid leave? Unpaid Leave Must be full-time and have provided more than one year of service to be eligible
Wage and Hour Laws
Fair Labor Standards Act of 1938 Child Labor Limitations exist on what jobs can be performed for children under age 18 Those under age 14 can only engage in certain trades such as delivering newspapers, working for their parents, or working in the agricultural industry Limitations on the hours a child under age 14 as well children ages 15-16 can work Example: 3 hours on a school day, 8 hours on a non-school day, up to 18 hours a week when school is in session and up to 40 hours a week when school is out. Some states require these children to acquire a work permit
Health Insurance
Health Insurance plans may be offered by employers What is an HSA? -A high deductible plan coupled with tax deferred savings account What is an FSA? -A savings account which allows for tax free contributions and distributions as long as qualified medical purchases are made Use it by year-end or lose it system COBRA Under the Consolidated Omnibus Budget Reconciliation Act of 1985, an employee of an employer with more than 20 employees may be able to purchase health insurance through their employer for a short time period following termination of employment Extends to certain family members of the employed as well.
Age Discrimination Hypo
Henry, age 61, recently applied for a job at Dakota Company. The person hiring him asked him if he was good with computers. He said "I know a little but I am not an expert because my generation did not grow up with them." Henry is not hired. Was he unlawfully discriminated against under the Age Discrimination in Employment Act of 1967? No, He may not have qualified for the job if it required expert computer skills. The fact that his generation did not grow up with them is not an excuse because if he had been in the work force for the last twenty years his computer skills should be sufficient enough
Intentional Discrimination v. Unintentional Discrimination
Intentional Discrimination "I won't hire you, you are a German" Disparate treatment discrimination is intentional discrimination. Once employee meets their burden of proof, the employer has the duty to prove that there was a non discriminatory reason for not hiring the individual Unintentional Discrimination Disparate-impact treatment When employment practices unintentionally discriminate against a protected class -Examples include: educational requirements and qualification exams
Vande Zande v. Wisconsin
Plaintiff Vande Zande was employed by the state of Wisconsin Plaintiff was paralyzed from the waist down and suffered pain from certain ulcers State argued ulcers were not a disability because it caused pain in episodes not continuously and Court disagreed because the pain was a symptom of her disability Court did agree that the state did not have to allow her to work from home
Defenses to Discrimination (for company accused)
Plaintiff has to create a prima facie case (meaning the employee has proven their case unless contradictory evidence can be provided to convince the court otherwise.) Once a Prima Facie case has been proven the employer has to prove the employment criteria in question have a business necessity. Business necessity: uniform job requirement which is a business necessity that is uniformly applied and consistent Example: bank tellers at 1st Trust Bank cannot have been convicted of a felony Bona Fide Occupational Qualification: is a Defense that employers can raise by proving their discriminatory policy is necessary to the normal operations of a business. Allowed as a defense against intentional discrimination unless the employment decision is related to race or color -Example: retirement age of 55 for a police officer because of safety and performance concerns Bona Fide Seniority Systems An employer may use a bona fide seniority system even if it causes discrimination. They must: 1) have a legitimate goal other than discrimination and 2) based upon length of service. Have to be uniformly applied -Example: parking spots reserved for longest tenured employees Reasonable Accommodations Employers can provide reasonable accommodations and use this as a defense Reasonable accommodations not required if an economic hardship will result Reasonable accommodations not required if they would be disruptive or require a significant change in business operations Technical defenses: Employee did not file with EEOC and receive a right to sue Employer does not have the requisite number of employees to be subject to federal or state discrimination law
Patient Protection and Affordable Care Act.
Purpose was to expand access to health insurance Requires states to either create an exchange where individuals can shop for insurance or allow access to a federal exchange Individuals must buy insurance (if not exempted) or face a penalty which grows to $695 a person by 2016 Allows states to expand Medicaid expansion and receive federal funding for doing so Employer mandate applies to employers with 50 or more employees Penalty for each employee in excess of 30 if the employer does not provide assistance Caps FSA contributions to $2500 Increases Medicare tax by .90% for high wage income earners Implements a 3.8% NII tax on those with MAGI of greater than $250,000 (MFJ) Supreme Court decision in National Federation of Independent Businesses vs. Kathleen Sebelius By and large, rules Affordable Care Act is Constitutional. Individual mandate allowed Federal government cannot force Medicaid expansion by withholding Medicaid funding No life-time limits Certain preventive measures to be provided cost- free No excluding pre-existing conditions for those under age 19 Coverage extended to beneficiaries 26 and under Limits the profit margin ratio on certain plans
Disability Discrimination Hypo
Rickie has migraine headaches. They often render him unable to walk or talk. Is this a disability under the ADA? yes, limits basic functions when disability in effect. Can be regulated with medication. Not Constant though?? so idk
Harassment Hypo
Ronald is a supervisor at GreatWorks Company. Ronald continually asks Melanie out to dinner on Friday nights. Ronald is a coworker of Melanie and not a supervisor. What liability might exist on the part of the company? If the supervisor knew then no liability exists. If Melanie submits a claim against Ronald for the hostile work environment and the company knows then they are liable by allowing for a hostile work environment.
Workers Compensation
States have workers compensation programs These programs compensate employees injured while part of an employment arrangement Employee must be on the job or acting in the course of employment Employee's accident cannot have been intentionally inflicted by the employee Injuries sustained while commuting are not generally covered ex: someone hurt in a car accident on the way to work Once an employee accepts workers' compensation, they are barred from suing their employer
Labor Unions
Taft-Hartley Act prohibits -Employers from discriminating against non union workers -Employers from requiring union membership -Employees from engaging in a secondary boycott -A secondary boycott occurs when employees refuse to deal with a company which does not have a dispute with the union -Closed shops (requires union membership) are not allowed -Union shops (requires union membership after a certain period of time) are allowed States may pass their own "right-to-work" laws which make it illegal to have a union shop Strike!!! When a union and employer cannot reach a collective bargaining agreement, a strike may occur National Labor Relations Act -Allows for peaceful strikes 1st Amendment protection available for picketing Employer may hire replacement workers These workers may be permanent replacements Employer cannot discriminate against those who strike when hiring for opening vacancies Different rules apply when the strike was based upon unfair practices
Title VII
Title VII of the Civil Rights Act of 1964 disallows discrimination in the context of employment in n regards to race, color, national origin, religion or gender Protects an employee at any level when the employment decision is regarding actions such as hiring, firing and advancement Applies to both labor unions and employers with more than 15 employees Government agencies generally covered as well regardless of the number of employees they have Race has been interpreted as encompassing ancestry, cultural identification, cultural association, or perceived relationships based upon such characteristics National Origin encompasses those who are born in a certain nation or is a descendant of someone who was born in a certain nation Color encompasses a person's skin pigmentation or the general shade of their complexion
Discrimination on Race and Gender Examples
To avoid liability, employer's policies must substantially relate to the qualifications of the job Residency requirements for example: Most Latinos live in nearby city but employer requires residency in the city of employment -Need a relationship which can be demonstrated to relate to a realistic qualification Reverse discrimination means discrimination against those not in a minority class -Example: male Caucasians not being hired because they are white males
Employee Benefits Hypo
Virginia recently quit her job. She had grown tired of her boss and the long commute she had to undertake each day. Which of the following benefits will Virginia be eligible for after she quits? Unemployment compensation? -NO Workers' compensation? -NO Cobra? -Probably Not Eligible. FMLA? -NO
EEOC Notice number 915.002
When calculating number of employees for purposes of Title VII and Age in Discrimination in Employment Act, courts can look at the payroll Employee does not have to actually be providing services Ultimate focus is on employment "relationship" not existence on the payroll
