BLAW-351: Exam 3 Notes

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Employer Rights and Responsibilities: Foreign Workers

-Immigration Reform and Control Act (1986): Requires employers to verify identity and eligibility of employees to work in the United States -Immigration Customs and Enforcement (ICE): Federal agency responsible for immigration worksite enforcement -Employers required to: --Confirm work authorization --Retain documentation for three years from the date of hire or one year after the employee is no longer employed -Failure to comply results in criminal and civil sanctions

Durable power of attorney

A document that states either the power of the agent is to continue to be effective if the principal becomes incapacitated or the power of the agent is to take effect after the principal has become incapacitated.

Disparate impact

A form of discrimination that arises when an employer's policy or practice appears to apply to everyone equally but its actual effect is that it disproportionately limits employment opportunities for a protected class.

Disparate treatment

A form of intentional discrimination in which an employee is hired, fired, denied a promotion, or the like, on the basis of membership in a protected class.

Picketing

A labor activity in which individuals place themselves outside an employer's place of business for the purpose of informing passersby of the facts of a labor dispute. Designed to inform public (usually through public demonstration and/or speech) of labor dispute

Remedies under Title VII

A plaintiff may seek both equitable and legal remedies for violations of Title VII. • A successful plaintiff may recover back pay for up to two years from the time of discriminatory act. Back pay is the difference between the amount of money the plaintiff earned since the discriminatory act and the amount of money she would have earned had the discriminatory act never occurred. • A plaintiff who was not hired for a job because of a Title VII violation may also receive remedial seniority dating back to the time when the plaintiff was discriminated against; compensatory damages, including those for pain and suffering; and, in some cases, punitive damages. • Punitive damages are capped at $300,000 for employers of more than 500 employees; $100,000 for firms with 101 to 200 employees; and $50,000 for firms with 100 or fewer employees. • An employer will not be held vicariously liable for punitive damages as long as it made "good-faith effort" to comply with federal law. • Attorney fees may be awarded to a successful plaintiff in Title VII cases; they are typically denied only when special circumstances would render the award unjust (the plaintiff's action was frivolous, unreasonable, or without foundation, the courts may award attorney feeds to the prevailing defendant.

Workers' compensation laws

A state law that provides for financial compensation to employees or their dependents when the covered employee is injured on the job.

Strike

A temporary, concerted withdrawal of labor.

Equal Pay Act of 1963

EPA prohibits an employer from discriminating within any establishment... between employees on the basis of sex by paying wages to employees in such establishment at a rate less than the rate at which he pay wages to employees of the opposite sex... for equal work on jobs the performance of which requires equal skill, effort, and responsibility, and which are performed under similar working conditions, except where payment is made pursuant to (i) seniority system; (ii) a merit system; (iii) a system which measures earnings by quantity or quality of production; or (iv) differential based on any factor other than sex. Defining Equal Work under EPA The courts have interpreted equal to mean substantially the same in terms of all four factors listed in the act: • Skill, Effort, Responsibility, and Working conditions The Impact of Extra Duties under EPA The courts scrutinize these duties very closely, and require that: • The extra duties are actually performed by those receiving the extra pay. • The extra duties regularly constitute a significant portion of the employee's job. • The extra duties are substantial, as opposed to inconsequential. • The extra duties are commensurate with the pay differential. • The extra duties are available on a nondiscriminatory basis. The courts will also make sure that different, comparable additional duties are not imposed on the parties not receiving the additional pay. Defenses under EPA There are four defenses available to the employer: • A bona fide seniority system • A bona fide merit system • A pay system based on quality or quantity of output • Factors other than sex Remedies for Violations of EPA • Plaintiffs may recover back pay in the amount of the difference between what they make and what is paid to members of the opposite sex, plus attorney fees. • If the employer was not acting in good faith in paying the discriminatory wage rates, the court will also award the plaintiff damages in an additional amount equal to the back pay.

American with Disabilities Act

ADA prohibits discrimination against employees and job applicants with disabilities. ADA attempts to attain this objective by requiring that employers make reasonable accommodations to the known physical or mental disabilities of an otherwise qualified person with a disability unless the necessary accommodation would impose an undue burden on the employer's business. Who is Protected under ADA? A disabled individual, for purposes of ADA, is defined as a person who meets one of the following criteria: • Has a physical or mental impairment that substantially limits one or more of the major life activities of such individual. • Has a record of such impairment. • Is regarded as having such an impairment. Enforcement Procedures under ADA ADA is enforced by the EEOC in the same way that Title VII is enforced. To bring a successful claim under ADA, the plaintiff must show that he or she meets all of the following: • Had a disability. • Was otherwise qualified for the job. • Was excluded from the job solely because of that disability. Remedies for Violations of ADA • A successful plaintiff may recover reinstatement, back pay, and injunctive relief. • In cases of intentional discrimination, limited compensatory and punitive damages are also available. • An employer who has repeatedly violated the act may be subject to fines of up to $100,000.

Age Discrimination in Employment Act of 1967

ADEA prohibits employers from refusing to hire, discharging, or discriminating in terms and conditions of employment on the basis of an employee's or applicant's being age 40 or older. The language describing the prohibited conduct is virtually the same as that of Title VII, except that age is the prohibited basis for discrimination. ADEA applies to employers having 20 or more employees. It also applies to employment agencies and to unions that have at least 25 members or that operate a hiring hall. ADEA does not apply to state employers. Proving Age Discrimination under ADEA • ADEA does not protect all individuals from discrimination based on age but protects only those age 40 or over. • The plaintiff raises the inference that age was a determining factor in the termination by showing that he or she: o Belongs to the statutorily protected class (those age 40 or older) o Was qualified for the position held. o Was terminated under circumstances giving rise to an inference of discrimination. • The plaintiff need not prove replacement by someone outside the protected class. Defenses under ADEA pg. 983

Creation of the Agency Relationship

Agency relationships can be created only for a lawful purpose, and almost anyone can serve as an agent. Agency relationships are consensual relationships formed by informal oral agreements or formal written contracts.

Tort Liability and the Agency Relationship

Agent's tortious conduct: The law holds a principal directly responsible for his or her own tortious conduct under two conditions: (1) The principal directs the agent to commit a tortious act, and (2) the principal fails to provide proper instruments or tools or adequate instructions. Respondeat superior: applies in the context of the principal/employer-agent/employee relationship. The principal/employer holds vicarious liability, which is liability assigned without fault, for any harm the agent/employee causes while working for the principal. -Principal/employer liable if employee wrongfully injures third party (not because he/she personally at fault, but because he/she negligently hired agent) Legal Principal: As a general rule, a principal is vicariously liable for the actions of his or her agent.

The Taft-Hartley Act of 1947

Also known as the Labor-Management Relations Act, the Taft-Hartley Act is designed to curtail some of the powers the unions had acquired under the Wagner Act. Just as Section 8(a) of the Wagner Act designated certain employer actions as unfair, Section 8(b) of the Taft-Hartley Act designated certain union actions as unfair.

Agency Relationships

An agency relationship is a fiduciary relationship (a relationship of trust) in which an agent acts on behalf of the principal. A principal-agent relationship exists when an employer hires an employee to enter into contracts on behalf of the employer (this is the most basic type of agency relationship); parties have agreed into contracts on behalf of employer; parties have agreed that agent will have power to bind principal in contract. An employer-employee relationship exists when an employer hires an employee to perform certain tasks or to perform some sort of physical service; employer has right to control conduct of employees. An employer independent contractor relationship exists when an employer hires persons , other than employees, to conduct some sort of task; employer has no control over details of conduct of independent contractor.

Agency coupled with an interest

An agency relationship that is created for the benefit of the agent, not the principal. Constructive notice [Notice of agency termination that is usually given by publishing an announcement in a newspaper.

Public policy exception

An exception to the employment-at-will doctrine that prohibits employers from firing employees for doing something that is consistent with furthering public policy.

Secondary boycott

An illegal labor action in which unionized employees who have a labor dispute with their employer boycott another company to force it to cease doing business with their employer.

Artie tells Brock, his cook, to buy 100 steaks; Brock, however, orders 1,000 steaks. Artie becomes aware of Brock's actions but does nothing to fix the order and thus accepts the order as placed. In this situation, who is liable? a. Artie could be liable for the steaks because of ratification. b. Artie could not be held liable for the steaks because of expressed authority. c. Artie could be held liable for the steaks because of implied authority. d. Artie acted with apparent authority and thus is solely liable. e. Artie is not liable because the act was unauthorized.

As a general rule, under the doctrine of respondeat superior a. a third party injured through the negligence of an employee can sue only the employee. b. a third party injured through the negligence of an employee can sue only the employer. c. an employee is never liable for tortuous acts he commits — only the employer is liable for the agent's actions. d. a third party injured through the negligence of an employee can sue either the employee or the employer. e. an employer is not vicariously liable.

Chapter 43 - Employment Discrimination Summary of Key Topics When May an Employee Be Fired?

At-will employment means that any employee who is not employed under a contract or a collective bargaining agreement may quit at any time for any reason or no reason at all, with no required notice to the employer. Moreover, the employer may fire the employee at any time, with no notice, for almost any reason. The exception for at-will employment is that an employer may not fire an employee for an illegal reason. An illegal reason may be any termination based on a violation of a state statute, a state constitution, a federal law, the U.S. Constitution, or public policy is illegal. Also, exceptions to at-will employment have also been found through breaches of implied contracts with employees on the basis of employee handbooks.

Bob and Kyle have a principal-agent relationship. Bob is Kyle's agent because Bob is an employee for Kyle's business. Bob signs a negotiable instrument under the authority of Kyle, but the instrument is not signed by Kyle. Something goes wrong with the negotiable instrument transaction, and Bob is liable to the third party for the negotiable instrument. Is Kyle also liable to the third party? A. No, this act was not authorized. B. No, Kyle was an undisclosed principal, so he is not liable. C. Yes, this was an authorized act. D. Yes, Kyle was an undisclosed principal, so he is liable to Bob. E. No, in certain situations the agent is the only party liable.

Consolidated Omnibus Budget Reconciliation Act (COBRA) of 1985

COBRA is a federal law ensuring that when employees lose their jobs or have their hours reduced to a level at which they would not be eligible to receive medical, dental, or optical benefits from their employer, the employees will be able to continue receiving benefits for themselves and their dependents under the employer's policy. The employee must pay the premiums for the policy, plus up to a 2 percent administration fee, to maintain coverage up to 18 month, or 29 months is disabled. Premiums are often quire expensive. An employee has 60 days after coverage would ordinarily terminate to decide whether to maintain it. COBRA benefits do not arise under either of two conditions: • 1) The employee is fired for gross misconduct • 2) The employer decides to eliminate benefits for all current employees

Cheryl discovers her son is very ill and needs to be admitted to the hospital and have the care and treatment of his mother after he is released. Cheryl desires family-related medical leave under the FMLA for this unforeseeable illness. How soon in advance must she notify her employer? A. Within one or two business days before the leave needs to begin. B. She does not need to give any advance notice because his condition is unforeseeable. C. At least 30 days before the leave needs to begin. D. As soon as practicable, within one or two business days after the need becomes known. E. The week she discovers he is ill.

Classification of the principal is important because it helps determine __________. a. the principal's liability b. whether the agent committed a tort c. whether there was a breach of contract

Types of Agency

Expressed agency: Agency formed by making a written or oral agreement. (most common type of agency) Power of attorney: Document giving an agent authority to sign legal documents on behalf of the principal. Durable power of attorney: Power of attorney intended to continue to be effective or to take effect after the principal has become incapacitated. Agency by implied authority: Agency formed by implication through the conduct of the parties. Agency by estoppel: Agency formed when a principal leads a third party to believe that another individual serves as his or her agent, but the principal had made no agreement with the so-called agent. Agency by ratification: Agency that exists when an individual misrepresents himself or herself as an agent for another party, and the principal accepts or ratifies the unauthorized act. For ratification to be effective, two additional requirements must be met: the principal must have complete knowledge of all material facts regarding the contract, and the principal must ratify the entirely of the agent's act (the principal cannot accept certain parts of the agent's act and reject others).

Joe is hired by a real estate company to complete a roofing job on one of their projects. The job is very specialized, he is under no supervision, and he is paid when he completes the job. Joe, however, needs to order supplies to complete this job. Does Joe have the authority to enter into contracts with other businesses as needed on behalf of the real estate company to obtain his supplies? a. Yes, Joe is an agent who has that authority. b. No, Joe is an employee, but the employee does not have that authority. c. It depends whether Joe signed a written contract for his employment. d. Yes, Joe is an employee. e. No, not unless he possesses authority from the principal because Joe is an independent contractor.

Disparate impact (Unintentional discrimination)

Disparate-impact cases arise when a plaintiff attempts to establish that while an employer's policy or practice appears to apply to everyone equally, its actual effect is that it disproportionately limits employment opportunities for a protected class. • Burden on Plaintiff (Employee): Establish statistically that a rule disproportionately restricts employment for those in a protected class • Burden on Defendant (Employer): Avoid liability by demonstrating that the practice or policy is a "business necessity" • Burden on Plaintiff (Employee): Can still recover by proving that the "business necessity" was promulgated as a mere pretext for discrimination

Family and Medical Leave Act (FMLA)

FMLA covers all public and private employers with 50 or more employees. It guarantees all eligible employees (those who have worked at least 25 hours a week for each of 12 months before the leave) with up to 12 weeks of unpaid leave during any 12-month period for any of the following family-related occurrences: • The birth of a child • The adoption of a child • The placement of a foster child in the employee's care • The care of a seriously ill spouse, parent, or child • A serious health condition that renders the employee unable to perform any of the essential functions of his or her job. Who is Covered under FMLA? • Public and private employers? Yes • Employers with 50 or more employees? Yes • Employers with fewer than 50 employees? No • Full-time employees for at least one year? Yes • Part-time employees for at least one year? Depends (must work at least 25 hours per week for 12 months before taking leave) • The leave is paid? No • The leave is for up to 12 weeks in a 12-month period? Yes • The employee may take more than 12 weeks off in 12 months? No To exercise rights under FMLA, an employee whose need is foreseeable (such as for childbirth) must advise the employer at least 30 days before the leave needs to begin. If the leave is unforeseeable, the employee must five notice as soon as practicable, defined as within one or two business days after the need becomes known. FMLA does not define the type of notice necessary, but the employee must state the reason for the leave and the length of time needed, and FMLA does not have to be specifically mentioned in the request. When their FMLA leaves terminate, employees must be restored to the same position they held, or one with substantially equivalent skills, effort, responsibility, and authority. If an employee is unable to return at the end of the 12-week period, the employer need not hold the position open any longer. When FMLA does not require that leave be paid, the employer must continue health insurance benefits. The employer may also require that an employee substitute paid time off for unpaid leave. Remedies for Violations of FMLA If an employer fails to comply with FMLA, the plaintiff may recover damages for unpaid wages or salary, lost benefits, denied compensation, and actual monetary losses up to an amount equivalent to the employee's wages for 12 weeks, as well as attorney fees and court costs. If the plaintiff can prove bad faith on the part of the employer, double damages may be awarded. An employee may also be entitled to reinstatement or promotion. Many employment law specialists are now seeing FMLA as an act employers must carefully follow.

Federal Laws Governing Employers

Federal employment laws provide a minimum level of protection for employees. The states may give employees more rights, but not less rights, than they have under federal law (federal supremacy).

Civil Rights Act (CRA) of 1964—Title VII

Federal law (as amended by the Civil Rights Act of 1991) that protects employees against discrimination based on race, color, religion, national origin, and sex; also prohibits harassment based on the same protected categories.

Pregnancy Discrimination Act (PDA) of 1987

Federal law that amended Title VII of the Civil Rights Act of 1964 by expanding the definition of sex discrimination to include discrimination based on pregnancy.

Occupational Safety and Health Act (OSHA) of 1970

Federal law that established the Occupational Safety and Health Administration, the agency responsible for setting safety standards under the act and for enforcing the act through inspections and the levying of fines against violators.

Equal Pay Act (EPA) of 1963

Federal law that prohibits an employer from paying workers of one gender less than the wages paid to employees of the opposite gender for work that requires equal skill, effort, and responsibility.

Americans with Disabilities Act (ADA)

Federal law that prohibits discrimination against employees and job applicants with disabilities.

Age Discrimination in Employment Act (ADEA) of 1967

Federal law that prohibits employers from refusing to hire, discharging, or discriminating in terms and conditions of employment on the basis of an employee's or applicant's being age 40 or older.

Taft-Hartley Act

Federal legislation designed to curtail some of the power that unions had acquired under the Wagner Act; designates certain union actions as unfair. Also called Labor-Management Relations Act.

According to one bar association article

Four essential steps that managers can take to protect their businesses from being involved in sexual harassment litigation. They are: (1) implement a policy against sexual harassment; (2) require supervisory training; (3) provide a mechanism for receiving complaints; and (4) create a method for conducting prompt and thorough investigations. Under California state law, managers are required to undergo training to prevent sexual harassment in the workplace.

If a principal falsely leads a third party to believe another individual serves as his or her agent, does an agency relationship actually exist? a. Yes, this is agency by implied authority. b. Yes, this is expressed agency. c. No, not unless a formal agency relationship has been formed. d. Yes, this is agency by estoppel. e. Yes, this is agency by ratification.

If an action was not authorized by the principal, who is liable for the agent's actions? a. The agent, unless the principal ratifies the agreement. b. Both the principal and the agent separately. c. The principal.

Disparate treatment (Intentional discrimination)

If the employee has been hired, fired, denied a promotion, or the like, on the basis of membership in a protected class under Title VII, this is a form of intentional discrimination and qualifies the employee to sue for disparate-treatment discrimination. Proving disparate-treatment discrimination in employment under Title VII is a three-step process: • Burden on Plaintiff (Employee): Demonstrate a prima facie case of discrimination • Burden on Defendant (Employer): Articulate a legitimate, nondiscriminatory business reason for the action • Burden on Plaintiff (Employee): Show that the reason given by the defendant (the employer) is a mere pretext

Discrimination Based on Sexual Orientation—Actionable?

In many states, an employee can legally be fired on the basis of sexual orientation. Discrimination in this area is based solely on state law. There is no federal protection against discrimination based on sexual orientation. Only 22 states have laws protecting against discrimination based on sexual orientation for all employees.

May an Employer Discriminate against a Smoker?

In many states, an employer may fire or refuse to hire an employee who smokes, even outside the workplace. Approximately 30 states and the District of Columbia, however, have "smoker's rights" laws that prohibit such employment action.

Madison was injured in a car accident on the way to the airport. She was heading to Chicago on a business trip. Which of the following statements is true regarding Madison's right to receive workers' compensation? a. Workers' compensation is purely state law. b. Madison will probably be covered by workers' compensation because she was headed to the airport for a business trip. c. Madison will probably have to sue her employer to collect workers' compensation. d. Both workers' compensation is purely state law and Madison will probably be covered by workers' compensation because she was headed to the airport for a business trip.

Quid pro quo harassment

Occurs when a supervisor makes a sexual demand on someone of the opposite sex and this demand is reasonably perceived as a term or condition of employment. The basis for this rule is that the supervisor would not make similar demands on someone of the same sex.

Pregnancy Discrimination Act of 1987

PDA amended Title VII of CRA to expand the definition of sex discrimination to include discrimination based on pregnancy. Discrimination on the basis of pregnancy, childbirth or related medical conditions constitutes unlawful sex discrimination under Title VII. Under the act, temporary disability caused by pregnancy must be treated the same as any other temporary disability.

Employee Privacy laws in the Workplace

Privacy issues are of increasing importance in the workplace. Privacy policies should cover matters such as employer surveillance, control of an access to medical and personnel records, drug testing, and e-mail policies. Legal Principle: Employees do not have a reasonable expectation of privacy when using their employers' e-mail system, even during nonworking hours.

Ricky is Jonah's boss. Before he goes on vacation, Ricky gives explicit instructions to Jonah not to buy any more shipments of ink cartridges because the company has enough to last them through the year. While Ricky is out of town, Jonah discovers an amazingly cheap deal for inkjet cartridges, and places a large bulk order for the company because the deal was too good to pass up. What are Ricky's options in this situation? A. Ricky can sue Jonah for breach of contract and recover damages because Jonah did not follow orders. B. Ricky has no legal remedies he can pursue. C. Jonah cannot be sued because he was acting as an agent for Ricky. D. Ricky can sue Jonah for breach of contract, but cannot recover damages due to indemnification. E. Ricky should pursue a constructive trust.

Roger is currently in the hospital, having been diagnosed with terminal cancer. Roger would like Kim, a close friend, to make any health decisions for him in the future if he is ever incapable of making such decisions for himself. Roger would be wise to enact A. agency by estoppel. B. a power of attorney. C. a duty to compensate. D. indemnification. E. a durable power of attorney.

Sam hires several students to deliver flowers for his florist business. Within the scope of one of the students' deliveries, one student has discovered a way to commit check fraud to receive more funds from the delivery of the flowers and commits a tort in the process. Sam does not condone this behavior, but he is aware of the check fraud and allows it to happen. Is Sam liable? A. Yes, the principal acted with intent in committing the tort. B. No, Sam was an undisclosed principal. C. Yes, the principal is liable for the agent committing a tort knowing that the agent acted illegally. D. It depends how serious the tort was. E. No, Sam was not the one who engaged in the tort.

All are correct!

Shea worked at Sunshine Market as a grocery clerk for two years and was a good employee. One day her boss came to work in a bad mood. The boss said he did not like the color of her shirt so he fired her! Shea sued her employer for wrongful termination. The judge dismissed her case, stating that Shea was an at will employee, therefore she could be fired for any reason or for no reason whatsoever. But what if the facts of the case were different? Select each set of facts below that could change the outcome of the court's decision. Check All That Apply a. Sunshine Market had given Shea an employee handbook that stated she would only be fired for "good cause." Sunshine Market had given Shea an employee handbook that stated she would only be fired for "good cause." b. Shea had recently served on jury duty despite protests by her boss at Sunshine Market. A week later, she was fired. Shea had recently served on jury duty despite protests by her boss at Sunshine Market. A week later, she was fired. c. Shea was concerned about the lack of cleanliness in the meat department at Sunshine Market. She complained to her boss several times, but nothing ever changed. Shea then lodged a formal complaint with the U.S. Department of Agriculture (USDA). A month later she was fired. Shea was concerned about the lack of cleanliness in the meat department at Sunshine Market. She complained to her boss several times, but nothing ever changed. Shea then lodged a formal complaint with the U.S. Department of Agriculture (USDA). A month later she was fired. d. Shea belongs to the United Food Workers (UFW) union.

Starr worked at Dewey, Cheatum & Howell, a law firm, for two years. One day she sent an email to her boyfriend from her work computer. The next day, during her lunch break, she decided to go online at work and order a new dress for her date that weekend. Later that evening, after everyone else had gone home, Starr went online at work and viewed a pornographic website. The next day, Starr was reprimanded by her employer. Which of the following is true with regard to Starr's right to use her employer's computer? A. Starr has a reasonable expectation of privacy when using her employer's computer if it is after her work hours have ended. As such, her employer has no reason to reprimand her. B. Starr has no reasonable expectation of privacy with regard to her use of her employer's computer; therefore, the employer was within its rights to reprimand her. C. Starr has a reasonable expectation of privacy when using her employer's computer if it was done during her lunch hours. D. Starr has a reasonable expectation of privacy when using her employer's computer if it is after her work hours have ended. As such, her employer has no reason to reprimand her. Starr has a reasonable expectation of privacy when using her employer's computer if it was done during her lunch hours.

Sexual harassment

Stated in the Equal Employment Opportunity Commission (EEOC) guidelines and accepted by the U.S. Supreme Court is unwelcome sexual advances, requests for sexual favors, and other verbal or physical conduct of a sexual nature that implicitly or explicitly makes submission a term or condition of employment; makes employment decisions related to the individual dependent on submission to or rejection of such conduct; or has the purpose of effect of creating an intimidating, hostile, or offensive work environment. Two recognized forms are hostile-environment and quid pro quo harassment.

Procedure for Filing a Claim Under Title VII Claim of Employment

Step 1 - File a charge with the EEOC: • Employee must file a charge with the EEOC within 180 days of the alleged discriminatory act. • Alternatively, employee may file a charge with a state agency (assuming one exists). Step 2 - EEOC conciliation attempts: • EEOC notifies the employer of the charge within 10 days. • EEOC investigates and attempts to negotiate a settlement between employer and employee. • EEOC may file a lawsuit in federal court on behalf of the employee. • If no settlement is reached and no lawsuit is filed by EEOC, the commission issues a "right-to-sue" letter to the employee. Step 3 • Employee may file a lawsuit.

Suppose Claude contracts Gerard (an antique dealer) to act as his agent to sell an antique journal from the 1800s he found in his grandfather's trunk. Claude authorizes Gerard to sell it for $500. However, in the course of showing the journal to several potential buyers, Gerard learns that the journal was written by Abraham Lincoln as a child. Because the journal is worth much more than $500, ______________________________________. A. the agency relationship would probably be terminated due to impossibility B. the agency relationship would probably be terminated due to disloyalty of an agent C. the agency relationship would probably be terminated due to changed circumstances D. the agency relationship would remain, and Gerard could keep the profit

Suppose Jon is Kayla's boss. Thus, in this relationship, Kayla is the agent. In the course of her employment, Jon gives Kayla unlawful instructions to commit tax fraud for the company's finances. In this situation, _______________________. a. the agent is required to follow the instruction due to the duty of obedience b. the agent is required to notify the EPA about the principal c. the agent is required to follow this instruction due to the duty of accounting d. the agent is not required to follow this instruction e. the agent is required to follow the instruction due to the duty of loyalty

Suppose Luke desires to sell his house, and he hires Gabe, a realtor, to help him. However, due to some unfortunate circumstances, Gabe loses his real estate license. Because Gabe can no longer fulfill the functions Luke authorized him to perform, which of the following statements is true? a. The agency relationship is terminated due to fulfillment of purpose. b. The agency relationship is not terminated. c. The agency relationship is terminated due to disloyalty of an agent. d. The agency relationship is terminated due to the occurrence of a specific event. e. The agency relationship is terminated due to impossibility.

Defenses to Claims Under Title VII

The Bona Fide Occupational Qualification Defense (BFOQ) • Allows an employer to discriminate in hiring on the basis of sex, religion, or national origin (but not race or color) when doing so is necessary for the performance of the job. • Necessity must be based on actual qualifications, not stereotypes about one group's abilities. • May a BFOQ be based on: Race? No; Sex (i.e. gender)? Yes; Religion? Yes; Color? No; National Origin? Yes; and Customer preference? (Exception: sexual privacy) No. The Merit Defense • Usually raised when hiring or promotion decisions are partially based on test scores. • Professionally developed ability tests that are not designed, intended, or used to discriminate may be used. While these tests may have an adverse impact on a class, as long as they are manifestly related to job performance, they do not violate the act. • Since 1978, the Uniform Guidelines on Employee Selection Procedures (UGESP) have guided government agencies charged with enforcing civil rights, and they provide guidance to employers and other interested persons about when ability tests are valid and job-related. • Under these guidelines, tests be validated in accordance with standards established by the American Psychological Association. Three types of validation are acceptable: o 1) Criterion-related validity, which is the statistical relationship between test scores and objective criteria of job performance o 2) Content validity, which isolates some skill used on the job and directly tests that skill o 3) Construct validity, wherein a psychological trait needed to perform the job is measured. o A test that required a secretary to use a computer would be content-valid. o A test of patience for a teacher would be construct-valid. The Seniority System Defense • A bona fide seniority system is a legal defense under Title VII; even though a seniority system, in which employees are given preferential treatment based on their length of service, may perpetuate past discrimination, such systems are considered bona fide and thus not illegal if (1) the system applies equally to all persons; (2) the seniority units follow industry practices; (3) the seniority system did not have its genesis in discrimination; and (4) the system is maintained free of any illegal discriminatory purpose.

Employment Discrimination Internationally

The Civil Rights Act of 1991 extended the protections of Title VII and ADA to U.S. citizens working abroad for American employers or for foreign corporations controlled by a U.S. employer (unless such enforcement would violate foreign law). These laws also apply to foreign corporations controlled by a U.S. employer

Unemployment Compensation

The Federal Unemployment Tax Act (FUTA) created a state system that provides unemployment compensation to qualified employees who lose their jobs. -Funded by states through tax on employers -Three states require minimal employee contributions Under this law, employers pay taxes to the states, which deposit the money into the federal government's Unemployment Insurance Fund. Each state has an account from which it can access money in accordance with state eligibility rules. Sates have different minimum standards for qualifying for unemployment compensation, although most require that the applicant did not voluntarily quit or get fired for cause. Most states fund benefits through a tax on employers; only three states require minimal employee contributions. The amount of the benefit may also vary.

The Immigration Reform and Control Act

The IRCA requires employers to verify the identity and eligibility of all individuals hired in the United States. Employers must file Employment Eligibility Verification Form I-9 on behalf of all employees and must make a good faith effort to ensure that their employees are legally permitted to work in the United States.

Immigration Reform and Control Act

The Immigration Reform and Control Act was passed in order to control and deter illegal immigration to the United States. Its major provisions stipulate legalization of undocumented aliens who had been continuously unlawfully present since 1982, legalization of certain agricultural workers, sanctions for employers who knowingly hire undocumented workers, and increased enforcement at U.S. borders.

Immigration Customs and Enforcement

The U.S. Immigration and Customs Enforcement (ICE) enforces federal laws governing border control, customs, trade and immigration to promote homeland security and public safety.

The Wagner Act of 1935

The Wagner Act was the first major piece of federal legislation adopted explicitly to encourage the formation of labor unions and provide for collective bargaining between employers and unions as a means of obtaining the peaceful settlement of labor disputes. Collective bargaining: Collective bargaining consists of negotiations between an employer and a group of employees to determine the conditions of employment. The key sections of the Wagner Act are: • 1) Section 7, which provides, "Employees shall have the right to self-organization, to join, form or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in concerted activities for the purpose of collective bargaining or other mutual aid and protection." • 2) Section 8(a), which specifies the actions that are prohibited as employer unfair labor practices. National Labor Relations Board (NLRB): The Wagner Act created the NLRB, an administrative agency, to interpret and enforce the National Labor Relations Act (NLRA) and to provide for judicial review in designated federal courts of appeal.

Duties of the Agent and the Principal

The duties of the principal: • Duty of compensation o The principal has a duty to compensate the agent for services provided unless the parties have agreed that the agent will act gratuitously. • Duty of reimbursement and indemnification o The principal has a duty to reimburse or indemnify the agent for any authorized expenditures or any losses the agent incurs in the course of working on behalf of the principal. • Duty of cooperation o The principal must assist the agent in the performance of his or her duties and cannot interfere with the reasonable conduct of the agent. • Duty of safe working conditions o The principal has a duty to ensure safe working conditions and to warn the agent if the principal is aware of any potential danger. The duties of the agent: • Duty of loyalty o The agent has a responsibility to act in the best interest of the principal; this duty is important because the agency relationship is founded on trust. • Duty of performance o The agent must perform the duties as specified in the agency agreement with reasonable skill, care, and professionalism • Duty of notification o The agent must notify the principal of any relevant information in a timely manner. • Duty of obedience o The agent must follow the lawful instruction and direction of the principal. • Duty of accounting o The agent must keep an accurate account of the transactions made on behalf of the principal and provide the accounting information to the principal on request.

Wagner Act

The first major piece of federal legislation adopted explicitly to encourage the formation of labor unions and provide for collective bargaining between employers and unions as a means of obtaining the peaceful settlement of labor disputes.

The principal is __________________ if the third party does not know that an agent is acting on behalf of a principal. a. Undisclosed b. partially disclosed c. disclosed

Collective bargaining

The process whereby workers organize collectively and bargain with employers regarding the conditions of employment.

Rights and Remedies

The rights and remedies of the principal: • Constructive trust • Avoidance • Indemnification The rights and remedies of the agent: • Tort and contract remedies • Demand for an accounting • Specific performance

Unemployment compensation

The state system, created by the Federal Unemployment Tax Act, that provides unemployment compensation to qualified to qualified employees who lose their jobs.

Legal Principle

The three main defenses to claims under Title VII are BFOQ, merit, and seniority system.

Unauthorized acts

These acts go beyond the scope of the agent's authority. -Third party reasonably believes agent has authority: --Agent liable --Principal not liable -Third party believes agent mistaken about his/her authority: --Agent not liable --Principal not liable Legal Principle: As a general rule, when an agent commits an unauthorized act, the principal is neither bound to the contract nor liable.

Authorized acts

These are acts within the scope of the agent's authority. In certain situations, the agent is the only party liable for the contract. These situations are: • 1) The contract expressly excludes the principal from the contract. If the principal was not a party to the contract, he or she no liability to the agent. • 2) The agent enters into a contract that is a negotiable instrument. • 3) The third party enters into a contract with the agent such that the agent's performance is required, and the third party may reject the performance of the principal. • 4) The principal or agent knows a third party would not enter into a contract with the principal if the principal's identity were disclosed but the agent does so anyway.

Civil Rights Act - Title VII

Title VII of CRA (1964, as amended by the Civil Rights Act of 1991) protects employees against discrimination based on race, color, religion, national origin, and sex. Prohibits employers from hiring, firing, or otherwise discriminating in terms and conditions of employment and prohibits segregating employees in a manner that would affect their employment opportunities on the basis of their race, color, religion, sex, or national origin. It also prohibits harassment based on the same protected categories. Title VII applies to employers who have 15 or more employees for 20 consecutive weeks within one year and who are engaged in a business that affects commerce (includes U.S. government, corporations owned by the government, agencies of the District of Columbia, Indian tribes, private clubs, unions, and employment agencies). Defenses to a charge of discrimination under Title VII include, but are not limited to, merit, seniority, and bona fide occupational qualification (BFOC).

Hostile-environment environment

To prove such harassment, a plaintiff must demonstrate the following: (1) He or she suffered intentional, unwanted discrimination because of his or her sex; (2) the harassment was severe or pervasive; (3) the harassment negatively affected the terms, conditions, or privileges of his or her work environment; (4) the harassment was both subjectively and objectively unwelcome; and (5) management knew about the harassment, or should have known, and did nothing to stop it.

Tom works as a mid-range executive at a brake pad manufacturing firm. In the course of his duties, he finds out the chief officers are committing tax fraud and running a pyramid scheme through the company's resources. He decides to inform the authorities about the officers. What can we say about Tom? a. Tom can only be fired if the employee handbook says whistle-blowing is banned. b. Tom cannot be fired for being a whistle-blower due to the public policy exception. c. Tom cannot be fired due to the implied-contract exception. d. Tom can be fired for no reason under the employment-at-will doctrine. e. Tom cannot be fired due to the implied covenant of good faith and fair dealing exception.

Tyler worked full-time as a maintenance worker at a factory. One day Tyler was fired. Under what circumstance below would Tyler be able to collect unemployment compensation under FUTA? a. Tyler was fired after he stole supplies from the factory. b. Tyler was fired as part of a reduction in force due to a slow economy. c. Tyler quit his job because they would not give him a raise. d. All of these.

Legal Principle

Under Title VII, an employer may not intentionally discriminate against an employee on the basis of race, color, national origin, sex, or religion.

Legal Principle

Under Title VII, an employer may not unintentionally discriminate against an employee on the basis of race, color, national origin, sex, or religion.

Drug Testing in the Workplace

Under the Drug-Free Workplace Act, employers that receive federal financial assistance or have federal contracts worth over $25,000 must develop an antidrug policy for employees, provide drug-free awareness programs for them, and warn them of penalties for violating company drug policies. Private employers engaged in drug testing are not limited by the U.S. Constitution as are public employers, but they still need to be aware of state statutory and constitutional limits. In most states, private companies have virtually unfettered discretion to test employees for drug usage.

Legal Principle

Under the Due Process and Equal Protection Clauses of the Fourteenth Amendment, same-sex couples have a fundamental right to marry.

Reasonable expectation of privacy

Under the ECPA, the protection afforded to individuals' communications against unauthorized surveillance or access; applies only minimally to communications via an employer's equipment.

Employment-at-Will Doctrine and Wrongful Termination

Under the employment-at-will doctrine, the employer can fire the employee for any reason at all. The three exceptions to the doctrine are implied contract, violations of public policy, and implied covenant of good faith and fair dealing. In states that have adopted any of these three exceptions, employees may be able to sue for wrongful discharge. The most common exception, the implied-contract exception provides that an implied employment contract may arise from statements the employer makes in an employment handbook, length of service, statements by the employer indicating long-term employment, or materials advertising the position. For instance, an implied contract can arise if: • 1) The employment handbook contains the steps for progressive discipline leading to discharge • 2) The handbook makes no mention of the words employment at will • 3) The employee relies on that handbook If the employer does not follow the policies in its own handbook, a fired employee may sue for wrongful discharge. The public policy exception prohibits employers from firing employees engaged in activities that further the public interest. Protected activities vary among states and include, but are not limited to, serving on jury duty, doing military service, filing for or testifying at hearings for workers' compensation claims, and whistle-blowing. The least common exception to at-will employment is the implied covenant of good faith and fair dealing exception. This exception assumes that every employment contract contains an implicit understanding that the parties will deal fairly with one another. Because there is no clear agreement on what constitutes fair treatment of an employee, most states do not use this exception. At-Will Employment - May an employer fire an at-will employee on the basis of: • Gender? No • Race? No • Political party? Yes • No reason? Yes Legal Principle: Under the employment-at-will doctrine, a contract of employment for an indeterminate period of time may be terminated at will by either party at any time and for any reason. In states that have adopted any of these three exceptions, employees may be able to sue for wrongful discharge.

Sexual harassment

Unwelcome sexual advances, requests for sexual favors, and other verbal or physical conduct of a sexual nature that makes submission a condition of employment or a factor in employment decisions or that creates an intimidating, hostile, or offensive work environment. The two types are hostile environment and quid pro quo.

Using the ________, if an employee is on company property, the courts generally find that she was on the job, for the purposes of receiving workers' compensation. a. FMLA b. premises rule c. COBRA d. professional employees rule e. minimum wage laws

What is the most common exception to the employment-at-will doctrine? a. Implied-contract exception. b. Public-policy exception. c. OSHA exception. d. Implied covenant of good faith and fair dealing exception. e. The gender and race exception.

When the third party is aware that the agent is making an agreement on behalf of a principal and also knows who the principal is, the principal is a ___________. a. partially disclosed principal b. disclosed principal c. undisclosed principal

Which of the following acts to terminate an agency relationship would most likely result in a principal's breaching his or her contract with an agent? a. Fulfillment of purpose. b. Mutual agreement by the parties. c. Lapse of time. d. Revocation of authority. e. Occurrence of a specific event.

Which of the following acts would result in a principal's being held liable in tort regardless of whether an agent was acting in the scope of his or her employment? a. Agent misrepresentation. b. Principal misrepresentation. c. An agent's act that constitutes a "frolic of his own." d. A principal's hiring an incompetent agent. e. An act performed on behalf of a principal.

Which of the following allows a principal to expressly grant his or her agent authority over specifically outlined acts? a. A general power of attorney. b. A special power of attorney. c. A durable power of attorney. d. A specific power of attorney. e. A power of attorney.

Which of the following does an employee not need to demonstrate to recover benefits under workers' compensation? a. The injury was serious enough for inpatient hospitalization care. b. He is an employee. c. The injury occurred on the job. d. All of these. e. Both the employer and the employee are covered by the workers' compensation program.

Which of the following forms of agency relationships is established when a principal leads a third party to falsely believe that another person is acting as her agent? a. Implied agency b. Apparent agency Correct c. Agency by ratification d. Expressed agency e. Gratuitous Agency

Which of the following is not a defense available in response to Title VII claims? a. Americans with Disabilities Defense. b. Bona fide occupational qualification. c. The seniority system defense. d. All of these are defenses to Title VII claims. e. The merit defense.

Which of the following is not a valid reason to fire an employee under the employment-at-will doctrine? a. Race b. Lied to supervisor c. Political party d. Missed work twice e. No reason

Which of the following is not an exception to the employment-at-will doctrine? a. Public policy b. Implied-contract c. Occupational Safety and Health Administration d. All of these are exceptions to the employment-at-will doctrine e. Implied covenant of good and fair dealing

Which of the following is not something required by the Employee Retirement Income Security Act (ERISA) for employers to provide? a. Plan information. b. A grievance and appeals process. c. Assurances that those in charge of managing assets have fiduciary responsibility. d. Health plans for government employees. e. The right to sue for benefits and breaches of duty.

Which of the following occurrences does not give employees family-medical leave under the Family and Medical Leave Act? a. The care of a child with cancer. b. The adoption of a child. c. The birth of a child. d. The care of a spouse after a serious heart attack. e. All of these occurrences are covered.

Who is covered under the provision of the FLSA that mandates employees working more than 40 hours a week earn time and a half pay? a. Regular salespersons b. Administrative employees c. Outside salespersons d. Executives e. Professional employees

Why do employers pay into the state workers' compensation fund every year? a. So employees can receive recovery when they are injured on the job. b. So employees can sue the company they work for. c. To ensure that their employee injury costs are fixed and they will not have to pay a huge negligence award. d. All of these are correct. e. None of these are correct.

Workers' Compensation Laws

Workers' compensation legislation consists of state laws that provide financial compensation to employees or their dependents when a covered employee is injured on the job. Workers' compensation laws ensure that covered workers injured on the job can receive financial compensation through an administrative procedure, rather than having to sue their employer. For administrative convenience, most states exclude certain types of businesses and small firms from coverage. Some also allow businesses with sufficient resources to be self-insured, rather than participating in the state program. Legal Principle: Under workers' compensation laws, an employee is guaranteed the right to recover for injuries that occurred on the job without having to sue his or her employer. Benefits under State Workers' Compensation To recover benefits, the injured party must demonstrate that (1) he or she is an employee, (2) both employer and employee are covered by the state workers' compensation program, and (3) the injury occurred on the job. Using the premises rule, if an employee is on company property, the courts generally find that she was on the job. If an employee who travels for work is injured on a business trip, many states will find that he is entitled to compensation for reasonable injuries suffered. An employee injured on the job must notify the employer of the injury and file a claim with the state workers' compensation board, usually within 30 to 60 days. The board will verify the claim and determine the appropriate benefits. If the employer contests the claim, a hearing takes place before the state workers' compensation board. If the claim is denied, most sates provide an agency appeals process followed by a provision for appeal to the courts. Most statutes cover medial, hospital, and rehabilitation expenses and generally lost wages. Advantages and Disadvantages of Workers' Compensation Employees benefit from workers' compensation laws because with very little effort they receive an almost certain recovery when injured, although the amount is less than they would have received from a successful negligence case against their employers. Employers must pay into the workers' compensation fund every year, but they thereby ensure that their employee injury costs are fixed and they will not have to pay a huge negligence award to an injured employee because workers' compensation is the employee's exclusive remedy.

May Employers Use Social Media in Employment Decisions?

Yes, employers may use social media in making employment decisions such as hiring and firing, but care must be taken to not run afoul of state and federal employment laws and regulations. The biggest concern is discrimination, so employers will need to take precautions to avoid such allegations.

__________ is the organization that enforces the Occupational Safety and Health Act (OSHA). a. The Justice Department b. The Securities and Exchange Commission c. The Securities Exchange Commission d. The Occupational Safety and Health Administration e. The Food and Drug Administration

Constructive trust

(1) An implied trust in which a party is named to hold the trust for its rightful owner. (2) An equitable trust imposed on someone who wrongfully obtains or holds legal right to property he or she should not possess.

Chapter 34 - Liability to Third Parties and Termination Summary of Key Topics Contractual Liability of the Principal and Agent

(Authorized Acts): Classification of the principal: The principal must be classified as either disclosed, partially disclosed, or undisclosed. Power of attorney, special power of attorney, general power of attorney, and durable power of attorney. -Disclosed principal: Agent not liable, principal liable -Partially disclosed principal: Agent possibly liable, principal liable -Unidentified principal -Undisclosed principal: Agent liable, principal liable

The National Labor Relations Board

-Created by Wagner Act -Administrative agency formed to interpret and enforce National Labor Relations Act Interprets and enforces the National Labor Relations Act (NLRA). The NLRB's three primary functions are to: • 1) Monitor the conduct of the employer and the union during an election to determine whether workers want to be represented by a union • 2) Prevent and remedy unfair labor practices by employers or unions • 3) Establish rules interpreting the act.

Wage and hour laws

-Federal and state laws that impose minimum wage and hour requirements for employees. -FLSA -Requires that a minimum wage of specified amount be paid to all covered employees -Specified amount periodically raised by Congress

Crime and Agency Relationships

-If an agent commits a crime, clearly the agent is liable for the crime. -If an agent commits a crime in the scope of his or her employment without authorization from the principal, the principal is not liable for the agent's crime. -Principal liable for agent's crime if principal authorized agent's criminal act

Primary boycotts

A boycott against an employer with whom the union is directly engaged in a labor dispute.

Power of attorney

A document giving an agent authority to sign legal documents on behalf of the principal; the power can be general or specific, limiting the authority of the agent.

Durable power of attorney

A document which specifies that an agent's authority is intended to continue beyond the principal's incapacitation.

Occupational Safety and Health Act (OSHA) of 1970

A federal law that established the Occupational Safety and Health Administration, the agency responsible for setting safety standards under the act (OSHA), as well as enforcing the act through promulgates workplace safety standards, inspects facilities for compliance, brings enforcement actions against violators, and the levying of fines against violators. OSHA requires that every employer furnish to each of his employees...employment... free from recognized hazards that are likely to cause death or serious physical harm. Under the law, employers must prominently display in the workplace either the federal or a state OSHA poster with information about employees' safety and health rights. Employers with 11 or more employees (20 percent of the establishments OSHA covers) must keep records of work-related injuries and illnesses except in low-hazard industries such as retail, service, finance, insurance, and real estate. Penalties under OSHA Penalties for violations may range from $0 to $70,000 per violation, depending on the likelihood that the violation would lead to serious injury to an employee. Penalties may be reduced if an employer has a small number of employees, has demonstrated good faith, or has few or no previous violations. If a willful violation results in the death of a worker, criminal penalties may be imposed.

Undisclosed principal

A principal whose existence is not known by a third party. That is, the third party does not know that an agent is acting on behalf of a principal.

Disclosed principal

A principal whose identity is known to a third party. The third party is aware that the agent is making an agreement on behalf of the principal.

Partially disclosed principal

A principal whose identity is not known by a third party, although the third party is aware that the agent is making an agreement on behalf of a principal. Also called unidentified principal.

Duty to compensate

A principals' obligation to pay an agent for his or her services.

Boycott

A refusal to deal with, purchase goods from, or work for a business.

Power of attorney

A specific type of express authority that grants an agent specific powers.

Special power of attorney

A type of express authority that allows an agent to act on behalf of the principal only in regard to specifically outlined acts.

General power of attorney

A type of express authority that allows an agent to conduct all business for the principal.

Note

Agency agreements usually do not need to be in writing, with two important exceptions. 1) The agreement must be in writing whenever an agent will enter into a contract that the statute of frauds requires to be in writing. The statute of frauds, or the equal dignities rule, mandates that the type of contracts people are allowed to enter into must be in writing. 2) The agreement must be in writing whenever an agent is given power of attorney

Creation of the Agency Relationship

Agency relationships can be formed if and only if: 1) They are being created for a lawful purpose. 2) The person who is to act as an agent has contractual capacity. Agency relationships can exist as one of four types: 1) Expressed agency, in which parties form the agency relationship by making a written or oral agreement. 2) Agency by implied authority, in which the agency relationship is implied by the conduct of the parties. 3) Apparent agency or agency by estoppel, in which the principal falsely leads a third party to believe another individual serves as his or her agent. 4) Agency by ratification, in which an individual misrepresents himself as another party's agent and the principal accepts the unauthorized act.

Legal Principle

Agency relationships cannot be created to conduct illegal activities.

Chapter 33 - Agency Formation and Duties Summary of Key Topics Introduction to Agency Law

Agency: The relationship between a principal and an agent. Agent: One authorized to act for and on behalf of a principal. Principal: One who hires an agent to represent him or her. Fiduciary: One with a duty to act primarily for another person's benefit.

National Labor Relations Board (NLRB)

An administrative agency created by the Wagner Act to interpret and enforce the National Labor Relations Act (NLRA).

Expressed agency

An agency created in a written or oral agreement. Also called agency by agreement.

Apparent agency

An agency relationship created by operation of law when one party, by her actions, causes a third party to believe someone is her agent even though that person actually has no authority to act as her agent. Also called agency by estoppel.

Agency by Implied Authority

An agency relationship is not created by an express agreement but is instead implied by the conduct of the parties. The circumstances determine the extent of an agent's ability to conduct business on behalf of the principal; however, implied authority cannot conflict with any express authority.

Duty of loyalty

An agent's obligation to act in the interest of the principal.

Duty of notification

An agent's obligation to inform the principal of the agent's actions on the principal's behalf and of all relevant information.

Implied covenant of good faith and fair dealing exception

An exception to the employment at-will doctrine that imposes a duty on the employer to treat employees fairly with respect to termination.

Implied-contract exception

An exception to the employment at-will doctrine which provides that an implied employment contract may arise from statements the employer makes in an employment handbook or materials advertising the position.

Signal picketing

An unprotected form of picketing in which services and/or deliveries to the employer are cut off.

The Collective Bargaining Process

Bargaining collectively in good faith means that the parties must: • 1) Meet at reasonable times and confer in good faith • 2) Sign a written agreement if one is reaches • 3) When intent on terminating or modifying an existing contract, give 60 days' notice to the other party, with an offer to confer over proposals, and give 30 days' notice to the federal or state mediation services in the event of a pending dispute over the new agreement. • 4) Neither strike nor engage in a lockout during the 60-day notice. An employer who fails to bargain in good faith is committing unfair labor practice under Section 8(a)5. The most common violation by a union is bargaining for clauses that fall outside the scope of mandatory bargaining. Legal Principle: The parties to a union contract must bargain collectively and in good faith.

Good Faith Requirements of National Labor Relations Act

Both employer and employee bargaining unit representative must: -Meet at reasonable times and confer in good faith -Sign a written agreement if one is reached -When intent on terminating/modifying existing contract, give 60 days' notice to other party, with offer to confer over proposals, and give 30 days' notice to federal/state mediation services in event of pending dispute over new agreement -Neither strike nor engage in lockout during 60-day notice

Chapter 42 - Employment and Labor Law Summary of Key Topics Introduction to Labor and Employment Law

Both the federal and state governments impose a number of conditions on the employment relationship. The purpose of this chapter was to explain many of the laws that created those constraints on the employer's ability to determine terms and conditions of employment and termination. The first half of this chapter covered wages, benefits, health and safety standards, and employee rights, including the right to privacy. The second half of this chapter covered labor unions.

Questions Regarding Course and Scope of Employment

Did employer authorize employee's act? Did act occur within time and space limits of employment? Was act performed (at least in part) on behalf of employer? To what extent were employer's interests advanced by act? To what extent were private interests of employee involved? Did employer provide the means by which act occurred? Did employee use force that employer did not expect? Did employer know that act would involve commission of crime?

Independent Contractor or Employee?

Does worker engage in distinct occupation/independently established business? Is work done under employer's supervision, or does specialist without supervision complete the work? Does employer supply the tools? What skill is required for the occupation? What is the length of time for which worker employed? Is worker a regular part of the employer's business? How is worker paid?

Employee Retirement Income Security Act (ERISA) of 1974

ERISA is a federal law that sets minimum standards for most voluntarily established pension and health plans in private industry to provide protection for individuals in these plans. Under ERISA, employers must provide participants with all the following: • 1) Plan information (features and funding). • 2) Assurances that those in charge of managing plan assets have fiduciary responsibility. • 3) A grievance and appeals process for participants to get benefits from their plans. • 4) The right to sue for benefits and breaches of fiduciary duty. The most important amendments are COBRA and HIPPA (Health Insurance Portability and Accountability Act), which provides important new protections for working Americans and their families who have preexisting medical conditions or might otherwise suffer discrimination in health coverage based to health plans for government or church employees or to plans maintained to comply with disability, workers' compensation, or unemployment laws. Legal Principle: ERISA requires that private employers keep employees informed about voluntarily established pension and health plans.

Legal Principle

Employees are agents of an employer.

Legal Principle

Employers are required to make a good faith effort to verify the eligibility of foreign workers.

Fair Labor Standards Act

Employers must follow federal minimum-wage and hour laws. FLSA covers all employers engaged in interstate commerce or the production of goods for interstate commerce and requires that a "minimum wage" of a specified amount be paid to all employees in covered industries. The specified amount is periodically raised by Congress to compensate for increases in the cost of living caused by inflation. The most recent increase took effect on July 24, 2009, when the minimum wage rose to $7.25 per hour. FLSA mandates that employees who work more than 40 hours in a week be paid no less than one- and one-half times their regular wage for all the hours they work beyond 40 during a given week. Four categories of employees are excluded: • Executives • Administrative employees • Professional employees • Outside salespersons Employees must earn at least a minimum income and spend a certain amount of time engaged in specified activities before they become exempt. If employers try to evade the overtime rule, their employees may sue. Legal Principle: Employers in covered industries are required to pay a federal minimum wage. The United Kingdom is like the United States in having no laws requiring paid or even unpaid holidays. The United States does not mandate any minimum annual vacation time for employees.

Family and Medical Leave Act (FMLA)

Federal act requiring that employers provide all eligible employees with up to 12 weeks of leave during any 12-month period for several family related occurrences (e.g., birth of a child, care of a sick spouse).

National Labor Relations Act (NLRA)

Federal labor legislation consisting of the Wagner and Taft-Hartley acts.

Federal Unemployment Tax Act (FUTA)

Federal law passed in 1935 that created a state system to provide unemployment compensation to qualified employees who lose their jobs.

Electronic Communications Privacy Act (ECPA) of 1986

Federal law that extended employees' privacy rights to electronic forms of communication including e-mail and cell phones; outlaws the intentional interception of electronic communications and the intentional disclosure or use of the information obtained through such interception. Employee Retirement Income Security Act (ERISA) [Federal law that sets minimum standards for most voluntarily established pension and health plans in private industry to provide protection for individuals in these plans.

Landrum-Griffin Act

Federal law that primarily governs the internal operations of labor unions. It requires financial disclosures by unions, establishes penalties for financial abuses by union officials, and includes "Labor's Bill of Rights" to protect employees from their own unions.

Consolidated Omnibus Budget Reconciliation Act (COBRA)

Federal law which ensures that when employees lose their jobs or have their hours reduced to a level at which they would not be eligible to receive medical, dental, or optical benefits from their employer, the employees will be able to continue receiving benefits under the employer's policy for up to 18 months by paying the premiums for the policy.

Fair Labor Standards Act (FLSA)

Federal law which requires that a minimum wage of a specified amount be paid to all employees in covered industries; also mandates that employees who work more than 40 hours in a week be paid no less than 1.5 times their regular wage for all hours beyond 40 worked in a given week.

Omnibus Crime Control and Safe Streets Act of 1968

Federal statute that prohibits employers from listening to the private telephone conversations of employees or disclosing the contents of these conversations. Employers may ban personal calls and monitor calls for compliance as long as they discontinue listening to any conversation once they determine it is personal.

Principal's Liability and the Independent Contractor

General rule: An individual who hires an independent contractor cannot be held liable for the independent contractor's tortious actions under the doctrine of respondeat superior unless the contractor engages in hazardous activities.

Employer-independent contractor

How to Identify • Employer has no control over details of conduct of independent contractor. Significant for What Issues? • Tort law, tax law, wage law, discrimination law, copyright law

Employer-employee relationship

How to Identify • Employer has right to control conduct of employees. Significant for What Issues? • Tort law, tax law, wage law, discrimination law, copyright law

Principal-agent relationship

How to Identify • Parties have agreed that agent will have power to bind principal in contract. Significant for What Issues? • Contract law

Legal Principle

Independent contractors cannot enter into contracts on behalf of the principal unless the contractor possesses authority from the principal.

Agency By Ratification Requirements

Individual must misrepresent himself/herself as agent for another party Principal accepts/ratifies unauthorized act Principal has complete knowledge of all material facts regarding contract Principal must ratify entirety of agent's act

Respondeat superior

Latin for "let the superior speak"; the principle by which liability for harm caused by an agent/employee is held by the principal/employer.

Actual notice

Notice of agency termination that is given by directly informing third parties, either orally or in writing.

Electronic Monitoring and Communication

Omnibus Crime Control and Safe Streets Act of 1968: Employers cannot listen to the private telephone conversations of employees or disclose the contents of these conversations. They may, however, ban personal calls and monitor calls for compliance as long as they discontinue listening to any conversation once they determine it is personal. Violators may be subject to fines of up to $10,000. Electronic Communications Privacy Act (ECPA) of 1986: Under ECPA, employees' privacy rights were extended to electronic forms of communication including e-mail and cellular phones. ECPA outlaws the intentional interception of electronic communications and the intentional disclosure or use of the information obtained through such interception. The key question is whether the employee had a reasonable expectation of privacy with respect to the communication in question. The ECPA protects individuals' communications against government surveillance conducted without a court order, from their parties without legitimate authorization to access the messages, and from carriers such as Internet service providers. It provides employees little privacy protection with respect to communications conducted on the employer's equipment. Employers are in the strongest position when they have a clear policy preventing any reasonable expectation of privacy. Employment law experts advise having a written policy that employees sign. At a minimum, employer privacy policies should cover the following issues: • 1) Employer monitoring of telephone conversations • 2) Employer surveillance policies • 3) Employee access to medical and personnel records. • 4) Drug testing policies • 5) Lie detector policies • 6) Ownership of computers and all issues unique to the electronic workplace. • 7) Workplace dating policies

Gratuitous agent

One who acts without consideration; that is, such an agent is not paid for his or her services. These agents' function much like regular agents, with few exceptions noted later in this chapter.

Informational picketing

Picketing designed to truthfully inform the public of a labor dispute between an employer and the employees.

The Landrum-Griffin Act of 1959

Primarily governs the internal operations of labor unions. This act, a response to evidence of certain undesirable internal labor union practices, requires financial disclosures by unions and establishes civil and criminal penalties for financial abuses by union officials. "Labor's Bill of Rights," contained in the act, protects employees from their own unions.

Principal and Agent Duties

Principal's duties to agent: -Compensation -Reimbursement and indemnification -Cooperation -Safe working conditions Agent's duties to principal: -Loyalty -Notification -Performance -Obedience -Accounting

Termination of the Agency Relationship

Termination by acts of parties: Termination may occur by lapse of time, fulfillment of purpose, occurrence of a specific event, mutual agreement by the parties, revocation of authority, renunciation by the agent, or agency coupled with an interest. Termination by operation of law: The agency relationship may be terminated automatically due to death, insanity, bankruptcy, changed circumstances, change in law, impossibility, disloyalty of agent, or war.

Agency relationship

The association between one party and an agent who acts on behalf of that party.

Employment-at-will doctrine

The doctrine which provides that either the employer or the employee can terminate the employment relationship at any time.

Agency

The fiduciary relationship that arises when one person consents to have another act on his behalf and subject to his control and the other consents to do so.

Vicarious liability

The liability or responsibility imposed on a person, a party, or an organization for damages caused by another; most commonly used in relation to employment, with the employer held vicariously liable for the damages caused by its employees.

Legal Principal

The principal owes specific duties to the agent. Failure to fulfill these duties provides the basis for a tort or contract action against the principal.

Respondeat superior

The principal/employer is liable not because he or she was personally at fault but because he or she negligently hired an agent.

Federal Labor Law Legislation

Wagner Act of 1935, Taft-Hartley Act of 1947, and Landrum-Griffin Act of 1959

Legal Principle

When an agent breaches his or her duties to the principal, the principal can terminate the agency relationship and seek remedies.

Legal Principal

When an agent fails to fulfill his duties to the principal, that failure provides the basis for a contract or tort action against the agent.

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