THE LEGAL ENVIRONMENT OF BUSINESS The Legal Environment
THE LEGAL ENVIRONMENT OF BUSINESS The Legal Environment of Business A Critical Thinking Approach 5 th Edition Nancy K. Kubasek Bartley A. Brennan M. Neil Browne © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch. 18 -1
THE LEGAL ENVIRONMENT OF BUSINESS CHAPTER 18 The Employment Relationship © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch. 18 -2
THE LEGAL ENVIRONMENT OF BUSINESS Employment Relationship Historical employer-employee relationship q “Employment-at-Will” q Increasingly regulated by federal and state laws © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch. 18 -3
THE LEGAL ENVIRONMENT OF BUSINESS Wage and Hour Laws q Fair Labor Standards Act (FLSA) q Sets minimum wage q 40 -hour week q Exempt workers Companies who tried to avoid paying overtime include: Taco. Bell, CVS, Petco, Walmart, and Computer sciences corp. © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch. 18 -4
THE LEGAL ENVIRONMENT OF BUSINESS Unemployment Compensation Federal Unemployment Tax Act q Created unemployment fund q States can draw and distribute funds q Standards differ among the states q © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch. 18 -5
THE LEGAL ENVIRONMENT OF BUSINESS COBRA 1985 (Consolidated Omnibus Budget Reconciliation Act of 1985) q Continues employee benefits after termination q Employee can keep benefits for 18 months q 60 -day decision window q Penalties for employer noncompliance © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch. 18 -6
THE LEGAL ENVIRONMENT OF BUSINESS Workers’ Compensation q State law system q Provides funds for injured workers q “No fault” basis q Covers on-the-job injuries q Funds distributed by agency per payment schedule Trade Off: Workers waive legal remedies in court action © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch. 18 -7
THE LEGAL ENVIRONMENT OF BUSINESS Family Medical Leave Act (1993) q Covers absences from work due to medical problems of workers’ family members q Applies to public employees and private business with 50+ workers q Provides 12 weeks in 12 month period © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch. 18 -8
THE LEGAL ENVIRONMENT OF BUSINESS FMLA Coverage q Birth or adoption q Foster children q Medical care of spouse, child, or parent q “Serious health condition” of employee © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch. 18 -9
THE LEGAL ENVIRONMENT OF BUSINESS FMLA Requirements q What constitutes “Proper notice”? q What constitutes a “ Medical condition” that is serious enough to invoke the protections of the act? © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch. 18 -10
THE LEGAL ENVIRONMENT OF BUSINESS FMLA Remedies q q q Can recover damages for up to 12 weeks of pay Attorneys fees and court costs Bad faith showing results in double damages q Reinstatement q Promotion © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch. 18 -11
THE LEGAL ENVIRONMENT OF BUSINESS Occupational Safety and Health Act (1970) Sets standards for workplace safety q Enforces regulations via inspections q © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch. 18 -12
THE LEGAL ENVIRONMENT OF BUSINESS OSHA Violations and Penalties Violations: q willful or repeat; q serious; q nonserious Penalties: Range from $7, 000 per day to $70, 000 per violation. Criminal penalties of fines and imprisonment for violations resulting in death. © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch. 18 -13
THE LEGAL ENVIRONMENT OF BUSINESS OSHA Related Agencies q OSHRC: Independent review board for OSHA citations q NIOSH: Research institution to develop standards and recommend policies © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch. 18 -14
THE LEGAL ENVIRONMENT OF BUSINESS Employee Privacy Rights Technology and privacy issues: q. Employer monitoring of worker communications may violate law. q. Employers may restrict, and monitor email. q. No eavesdropping permitted. Omnibus Crime Control Act and Electronic Communications Privacy Act - provides employees with enforceable privacy rights in the workplace. © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch. 18 -15
THE LEGAL ENVIRONMENT OF BUSINESS Related Workplace Privacy Issues q Surveillance cameras q Access to medical records q Drug testing q Polygraph testing © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch. 18 -16
THE LEGAL ENVIRONMENT OF BUSINESS Employer Response q Company policy statements q States company rules q Requires employee to acknowledge q Removes any “reasonable expectation of privacy” © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch. 18 -17
THE LEGAL ENVIRONMENT OF BUSINESS Drug Testing Drug – Free Workplace Act 1988 q Requires anti-drug policies of certain employers q Testing requirement vs. employees’ constitutional rights q Testing q “reasonable suspicion” q pre-employment q periodic q random © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch. 18 -18
THE LEGAL ENVIRONMENT OF BUSINESS Other Testing q Employers attempt to prescreen applicants via tests: qskills qmedical q Protection against abusive practices: Employee Polygraph Protection Act 1988 q q Americans with Disabilities Act © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch. 18 -19
THE LEGAL ENVIRONMENT OF BUSINESS Global Dimensions of Employment Law Rights of employees in most other industrialized countries are far more extensive than in U. S. Europe: q generous family leave q guaranteed paid leave q more vacation time © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch. 18 -20
THE LEGAL ENVIRONMENT OF BUSINESS All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of the publisher. Printed in the United States of America. Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch. 18 -21
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