THE LEGAL ENVIRONMENT OF BUSINESS © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch The Legal Environment of Business A Critical Thinking Approach 5 th Edition Nancy K. Kubasek Bartley A. Brennan M. Neil Browne

THE LEGAL ENVIRONMENT OF BUSINESS © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch THE LEGAL ENVIRONMENT OF BUSINESS CHAPTER 18 The Employment Relationship

THE LEGAL ENVIRONMENT OF BUSINESS © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch Employment Relationship Historical employer-employee relationship  “Employment-at-Will”  Increasingly regulated by federal and state laws

THE LEGAL ENVIRONMENT OF BUSINESS © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch Wage and Hour Laws  Fair Labor Standards Act (FLSA)  Sets minimum wage  40-hour week  Exempt workers Companies who tried to avoid paying overtime include: TacoBell, CVS, Petco, Walmart, and Computer sciences corp.

THE LEGAL ENVIRONMENT OF BUSINESS © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch Unemployment Compensation  Federal Unemployment Tax Act  Created unemployment fund  States can draw and distribute funds  Standards differ among the states

THE LEGAL ENVIRONMENT OF BUSINESS © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch  Continues employee benefits after termination  Employee can keep benefits for 18 months  60-day decision window  Penalties for employer noncompliance COBRA 1985 (Consolidated Omnibus Budget Reconciliation Act of 1985)

THE LEGAL ENVIRONMENT OF BUSINESS © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch Workers’ Compensation  State law system  Provides funds for injured workers  “No fault” basis  Covers on-the-job injuries  Funds distributed by agency per payment schedule Trade Off: Workers waive legal remedies in court action

THE LEGAL ENVIRONMENT OF BUSINESS © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch Family Medical Leave Act (1993)  Covers absences from work due to medical problems of workers’ family members  Applies to public employees and private business with 50+ workers  Provides 12 weeks in 12- month period

THE LEGAL ENVIRONMENT OF BUSINESS © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch FMLA Coverage  Birth or adoption  Foster children  Medical care of spouse, child, or parent  “Serious health condition” of employee

THE LEGAL ENVIRONMENT OF BUSINESS © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch FMLA Requirements  What constitutes “Proper notice”?  What constitutes a “ Medical condition” that is serious enough to invoke the protections of the act?

THE LEGAL ENVIRONMENT OF BUSINESS © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch FMLA Remedies  Can recover damages for up to 12 weeks of pay  Attorneys fees and court costs  Bad faith showing results in double damages  Reinstatement  Promotion

THE LEGAL ENVIRONMENT OF BUSINESS © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch Occupational Safety and Health Act (1970)  Sets standards for workplace safety  Enforces regulations via inspections

THE LEGAL ENVIRONMENT OF BUSINESS © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch OSHA Violations and Penalties Violations:  willful or repeat;  serious;  nonserious Penalties: Range from $7,000 per day to $70,000 per violation. Criminal penalties of fines and imprisonment for violations resulting in death.

THE LEGAL ENVIRONMENT OF BUSINESS © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch OSHA Related Agencies  OSHRC: Independent review board for OSHA citations  NIOSH: Research institution to develop standards and recommend policies

THE LEGAL ENVIRONMENT OF BUSINESS © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch Employee Privacy Rights Technology and privacy issues: Omnibus Crime Control Act and Electronic Communications Privacy Act - provides employees with enforceable privacy rights in the workplace.  Employer monitoring of worker communications may violate law.  Employers may restrict, and monitor .  No eavesdropping permitted.

THE LEGAL ENVIRONMENT OF BUSINESS © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch Related Workplace Privacy Issues  Surveillance cameras  Access to medical records  Drug testing  Polygraph testing

THE LEGAL ENVIRONMENT OF BUSINESS © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch Employer Response  Company policy statements  States company rules  Requires employee to acknowledge  Removes any “reasonable expectation of privacy”

THE LEGAL ENVIRONMENT OF BUSINESS © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch Drug Testing  Requires anti-drug policies of certain employers  Testing requirement vs. employees’ constitutional rights  Testing  “reasonable suspicion”  pre-employment  periodic  random Drug – Free Workplace Act 1988

THE LEGAL ENVIRONMENT OF BUSINESS © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch Other Testing  Employers attempt to prescreen applicants via tests:  skills  medical  Protection against abusive practices:  Employee Polygraph Protection Act 1988  Americans with Disabilities Act  EEOC

THE LEGAL ENVIRONMENT OF BUSINESS © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch Global Dimensions of Employment Law Rights of employees in most other industrialized countries are far more extensive than in U.S. Europe:  generous family leave  guaranteed paid leave  more vacation time

THE LEGAL ENVIRONMENT OF BUSINESS © 2009 Pearson Education, Inc. publishing as Prentice Hall Ch 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. Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall