1. CHAPTER 40 LABOR AND FAIR EMPLOYMENT PRACTICES DAVIDSON, KNOWLES & FORSYTHE Business Law: Cases and Principles in the Legal Environment (8 th Ed.)

2. © 2004 West Legal Studies in Business A Division of Thomson Learning BUSINESS LAW: Cases & Principles Davidson Knowles Forsythe 8 th Ed. 2 INTRODUCTION Labor and fair employment practices laws provide the framework under which workers operate and under which employees are regulated and protected. Labor and fair employment practices laws provide the framework under which workers operate and under which employees are regulated and protected. Labor law applies to the relationship between management and workers. Labor law applies to the relationship between management and workers. Fair employment practices law deals with employer rights and responsibilities. Fair employment practices law deals with employer rights and responsibilities.

3. © 2004 West Legal Studies in Business A Division of Thomson Learning BUSINESS LAW: Cases & Principles Davidson Knowles Forsythe 8 th Ed. 3 FEDERAL LABOR LAW Federal Statutes. Federal Statutes. – Unions not always a fact of life. – Violent and divisive battles characterized employer and pro-union workers relations. – Federal courts were hostile and viewed union activities as criminal conspiracies. – Clayton Act passed to shield unions from liability under antitrust laws, Supreme Court decisions narrowed statutory protection.

4. © 2004 West Legal Studies in Business A Division of Thomson Learning BUSINESS LAW: Cases & Principles Davidson Knowles Forsythe 8 th Ed. 4 NORRIS-LAGUARDIA ACT (1932) Immunized certain activities, e.g., peaceful refusals to work, from federal court action. Immunized certain activities, e.g., peaceful refusals to work, from federal court action. Authorizes boycotts and picketing. Authorizes boycotts and picketing. Barred federal injunctions in the context of labor disputes as well as institution of yellow dog contracts. Barred federal injunctions in the context of labor disputes as well as institution of yellow dog contracts. Permitted employees to organize and collectively bargain. Permitted employees to organize and collectively bargain. Aimed at keeping courts out of the labor field. Aimed at keeping courts out of the labor field.

5. © 2004 West Legal Studies in Business A Division of Thomson Learning BUSINESS LAW: Cases & Principles Davidson Knowles Forsythe 8 th Ed. 5 THE WAGNER ACT (1935) Encourages organizing activities and bargaining. Encourages organizing activities and bargaining. Allows workers the freedom to join unions. Allows workers the freedom to join unions. Collectively bargain with an employer. Collectively bargain with an employer. Engage in mutually beneficial activities. Engage in mutually beneficial activities. Established National Labor Relations Board (NLRB): Established National Labor Relations Board (NLRB): – Charged with administering and interpreting the unfair labor practice provisions of this law.

6. © 2004 West Legal Studies in Business A Division of Thomson Learning BUSINESS LAW: Cases & Principles Davidson Knowles Forsythe 8 th Ed. 6 TAFT-HARTLEY ACT (1947) Prohibits unfair labor practices by unions. Prohibits unfair labor practices by unions. Separates the NLRB’s functions. Separates the NLRB’s functions. Empowers the courts to grant various civil and criminal remedies. Empowers the courts to grant various civil and criminal remedies. Created the Federal Mediation and Conciliation Service for settling disputes between labor and management. Created the Federal Mediation and Conciliation Service for settling disputes between labor and management.

7. © 2004 West Legal Studies in Business A Division of Thomson Learning BUSINESS LAW: Cases & Principles Davidson Knowles Forsythe 8 th Ed. 7 LANDRUM-GRIFFIN ACT (1959) Requires extensive reporting on unions’ financial affairs. Requires extensive reporting on unions’ financial affairs. Allows for civil and criminal penalties for corruption by union officers. Allows for civil and criminal penalties for corruption by union officers. Provides a “bill of rights” for members regarding elections and meetings. Provides a “bill of rights” for members regarding elections and meetings. Mandates democratic procedures in the conduct of union affairs. Mandates democratic procedures in the conduct of union affairs.

8. © 2004 West Legal Studies in Business A Division of Thomson Learning BUSINESS LAW: Cases & Principles Davidson Knowles Forsythe 8 th Ed. 8 FEDERAL LABOR LAW Further Issues Further Issues – Questions arise when employees select their bargaining representative. – Employer resists the election/representation process, may attempt to “decertify” the union. – Certification process may raise property issues, because organizers ordinarily distribute union literature to employees in firms. NLRB invalidates soliciting employees and distributing of literature during working hours. NLRB invalidates soliciting employees and distributing of literature during working hours.

9. © 2004 West Legal Studies in Business A Division of Thomson Learning BUSINESS LAW: Cases & Principles Davidson Knowles Forsythe 8 th Ed. 9 FEDERAL LABOR LAW Further Issues Further Issues – Wagner Act requires good-faith bargaining by employer and the union. – Both sides can use economic weapons outside the bargaining room. – NLRB orders are not self-enforcing, they become law only when imposed by a federal circuit court of appeals.

10. © 2004 West Legal Studies in Business A Division of Thomson Learning BUSINESS LAW: Cases & Principles Davidson Knowles Forsythe 8 th Ed. 10 LABORLABOR State Laws: State Laws: – State law regulating labor is preempted by federal law. – Matters peripheral to federal law or of deep state concern are subject to state regulation.

11. © 2004 West Legal Studies in Business A Division of Thomson Learning BUSINESS LAW: Cases & Principles Davidson Knowles Forsythe 8 th Ed. 11 EMPLOYMENT LAW Designed to ensure equal employment opportunity for persons historically foreclosed from the workplace. Designed to ensure equal employment opportunity for persons historically foreclosed from the workplace. Civil Rights Act of 1964. Civil Rights Act of 1964. – Title VII of this Act applies to employers with 15 or more employees. – Unions with 15 or more members or who operate a hiring hall and employment agencies. – Law forbids any form of employment discrimination on basis of race, color, religion, sex, or national origin.

12. © 2004 West Legal Studies in Business A Division of Thomson Learning BUSINESS LAW: Cases & Principles Davidson Knowles Forsythe 8 th Ed. 12 Civil Rights Act of 1964: Civil Rights Act of 1964: – Forbids disparate treatment. – Forbids disparate impact. – Forbids harassment. Affirmative Action. Affirmative Action. Sexual Harassment. Sexual Harassment. EMPLOYMENT LAW

13. © 2004 West Legal Studies in Business A Division of Thomson Learning BUSINESS LAW: Cases & Principles Davidson Knowles Forsythe 8 th Ed. 13 SEXUAL HARASSMENT Although Title VII does not specifically mention sexual harassment as a form of sex discrimination, the U.S. Supreme Court has interpreted Title VII’s prohibition against sex discrimination to include a prohibition against sexual harassment. Although Title VII does not specifically mention sexual harassment as a form of sex discrimination, the U.S. Supreme Court has interpreted Title VII’s prohibition against sex discrimination to include a prohibition against sexual harassment. There are currently two forms of recognized sexual harassment: There are currently two forms of recognized sexual harassment: – Hostile Work Environment. – Quid Pro Quo. Although Title VII does not specifically mention sexual harassment as a form of sex discrimination, the U.S. Supreme Court has interpreted Title VII’s prohibition against sex discrimination to include a prohibition against sexual harassment. Although Title VII does not specifically mention sexual harassment as a form of sex discrimination, the U.S. Supreme Court has interpreted Title VII’s prohibition against sex discrimination to include a prohibition against sexual harassment. There are currently two forms of recognized sexual harassment: There are currently two forms of recognized sexual harassment: – Hostile Work Environment. – Quid Pro Quo.

14. © 2004 West Legal Studies in Business A Division of Thomson Learning BUSINESS LAW: Cases & Principles Davidson Knowles Forsythe 8 th Ed. 14 HOSTILE WORK ENVIRONMENT Hostile environment occurs when workplace is “permeated” with discriminatory intimidation, ridicule, insult so severe to alter the conditions of the victim’s employment. Hostile environment occurs when workplace is “permeated” with discriminatory intimidation, ridicule, insult so severe to alter the conditions of the victim’s employment. The conduct in the workplace must be offensive to a reasonable person as well as to the victim, and it must be severe and pervasive. The conduct in the workplace must be offensive to a reasonable person as well as to the victim, and it must be severe and pervasive. Hostile environment occurs when workplace is “permeated” with discriminatory intimidation, ridicule, insult so severe to alter the conditions of the victim’s employment. Hostile environment occurs when workplace is “permeated” with discriminatory intimidation, ridicule, insult so severe to alter the conditions of the victim’s employment. The conduct in the workplace must be offensive to a reasonable person as well as to the victim, and it must be severe and pervasive. The conduct in the workplace must be offensive to a reasonable person as well as to the victim, and it must be severe and pervasive.

15. © 2004 West Legal Studies in Business A Division of Thomson Learning BUSINESS LAW: Cases & Principles Davidson Knowles Forsythe 8 th Ed. 15 HARASSMENT BY SUPERVISORS Quid Pro Quo harassment involves the demands for sexual favors by a superior from a subordinate, in exchange for some workplace benefit. Quid Pro Quo harassment involves the demands for sexual favors by a superior from a subordinate, in exchange for some workplace benefit. Under certain conditions, an employer may be liable for the quid pro quo harassment committed by its supervisory employees. Under certain conditions, an employer may be liable for the quid pro quo harassment committed by its supervisory employees. Quid Pro Quo harassment involves the demands for sexual favors by a superior from a subordinate, in exchange for some workplace benefit. Quid Pro Quo harassment involves the demands for sexual favors by a superior from a subordinate, in exchange for some workplace benefit. Under certain conditions, an employer may be liable for the quid pro quo harassment committed by its supervisory employees. Under certain conditions, an employer may be liable for the quid pro quo harassment committed by its supervisory employees.

16. © 2004 West Legal Studies in Business A Division of Thomson Learning BUSINESS LAW: Cases & Principles Davidson Knowles Forsythe 8 th Ed. 16 SUPREME COURT GUIDELINES Burlington Industries v. Ellerth (1998). Burlington Industries v. Ellerth (1998). – Company liable for harassment even though the employee suffered no adverse job consequences. Faragher v. City of Boca Raton (1998). Faragher v. City of Boca Raton (1998). – Employer (city) could be liable for supervisor’s harassment even though the employer was unaware of the conduct. Harassment policies and procedures had not be distributed among employees.

17. © 2004 West Legal Studies in Business A Division of Thomson Learning BUSINESS LAW: Cases & Principles Davidson Knowles Forsythe 8 th Ed. 17 Employers have a defense if: Employers have a defense if: – They took “reasonable care to prevent and correct promptly any sexually harassing behavior” by establishing and distributing effective harassment policies and procedures. – That the employee suing for harassment failed to follow these policies and procedures. SUPREME COURT GUIDELINES

18. © 2004 West Legal Studies in Business A Division of Thomson Learning BUSINESS LAW: Cases & Principles Davidson Knowles Forsythe 8 th Ed. 18 HARASSMENT BY CO-WORKERS Employer generally liable only if employer knew or should have known and failed to take action. Employer generally liable only if employer knew or should have known and failed to take action. – Employee notice to supervisor is notice to Employer under agency law. Employers may also be liable for harassment by non-employees. Employers may also be liable for harassment by non-employees. Same-sex harassment also violates Title VII. Same-sex harassment also violates Title VII.

19. © 2004 West Legal Studies in Business A Division of Thomson Learning BUSINESS LAW: Cases & Principles Davidson Knowles Forsythe 8 th Ed. 19 Pregnancy Discrimination Act of 1978 Pregnancy Discrimination Act of 1978 – Mandates pregnancy be treated as any other disability protected by law. – Expressly states that sex discrimination under Title VII includes discrimination on the basis of pregnancy, childbirth, or related medical conditions. EMPLOYMENT LAW

20. © 2004 West Legal Studies in Business A Division of Thomson Learning BUSINESS LAW: Cases & Principles Davidson Knowles Forsythe 8 th Ed. 20 Immigration Reform and Control Act of 1986 bans discrimination based on national origin or citizenship status. Immigration Reform and Control Act of 1986 bans discrimination based on national origin or citizenship status. Equal Pay Act of 1963 prohibits discrimination in wages on the basis of sex. Equal Pay Act of 1963 prohibits discrimination in wages on the basis of sex. Age Discrimination in Employment Act of 1967 protects workers aged 40 or older from adverse employment decisions based on age. Age Discrimination in Employment Act of 1967 protects workers aged 40 or older from adverse employment decisions based on age. EMPLOYMENT LAW

21. © 2004 West Legal Studies in Business A Division of Thomson Learning BUSINESS LAW: Cases & Principles Davidson Knowles Forsythe 8 th Ed. 21 The Rehabilitation Act of 1973 directs federal contractors to reasonably accommodate “otherwise qualified” handicapped individuals in connection with employment. The Rehabilitation Act of 1973 directs federal contractors to reasonably accommodate “otherwise qualified” handicapped individuals in connection with employment. EMPLOYMENT LAW

22. © 2004 West Legal Studies in Business A Division of Thomson Learning BUSINESS LAW: Cases & Principles Davidson Knowles Forsythe 8 th Ed. 22 ADA The Americans with Disabilities Act of 1990 guarantees an individual with a “disability” equal access to public services and requires employers to make a reasonable accommodation in employment for qualified persons with disabilities. The Americans with Disabilities Act of 1990 guarantees an individual with a “disability” equal access to public services and requires employers to make a reasonable accommodation in employment for qualified persons with disabilities. Toyota Motor Manufacturing v. Williams (2002). Toyota Motor Manufacturing v. Williams (2002).

23. © 2004 West Legal Studies in Business A Division of Thomson Learning BUSINESS LAW: Cases & Principles Davidson Knowles Forsythe 8 th Ed. 23 Civil Rights Act of 1991: Civil Rights Act of 1991: – Amends earlier statutes to broaden the scope of protections afforded under anti-discrimination law. – Prohibits “race norming” of employment tests. – Allows compensatory and punitive damage awards and jury trials. EMPLOYMENT LAW

24. © 2004 West Legal Studies in Business A Division of Thomson Learning BUSINESS LAW: Cases & Principles Davidson Knowles Forsythe 8 th Ed. 24 Family Medical Leave Act. Family Medical Leave Act. – Mandates that eligible employees receive up to 12 weeks of leave during any 12 month period for certain family related events: Birth of a child Birth of a child Placement of a child with the employee for adoption or foster care Placement of a child with the employee for adoption or foster care Care of a seriously ill spouse, child, or parent Care of a seriously ill spouse, child, or parent Serious health condition of the employee that make employee unable to perform and of the essential functions of the job. Serious health condition of the employee that make employee unable to perform and of the essential functions of the job. EMPLOYMENT LAW

25. © 2004 West Legal Studies in Business A Division of Thomson Learning BUSINESS LAW: Cases & Principles Davidson Knowles Forsythe 8 th Ed. 25 Other Fair Employment Practices Laws. Other Fair Employment Practices Laws. – The Vietnam Era Veterans’ Readjustment Assistance Act of 1974. – Various executive orders. – Civil Rights Acts of 1866 and 1871. – State law. EMPLOYMENT LAW

26. © 2004 West Legal Studies in Business A Division of Thomson Learning BUSINESS LAW: Cases & Principles Davidson Knowles Forsythe 8 th Ed. 26 EMPLOYMENT Occupational Safety and Health Act: Occupational Safety and Health Act: – Mandates safe and healthful workplace conditions. – Act authorizes enforcement of standards through the Occupational Safety and Health Administration (OSHA). – Assists and encourages states’ efforts to assure safe and healthful working conditions. – Provides research, information, education, and training in the field of safety and health.

27. © 2004 West Legal Studies in Business A Division of Thomson Learning BUSINESS LAW: Cases & Principles Davidson Knowles Forsythe 8 th Ed. 27 EMPLOYMENT Social Security. Social Security. – Provides federal benefits to the aged, the disabled, and other “fully insured” workers. – The Federal Insurance Contribution Act (FICA) taxes paid by employees and employers on wages earned by workers fund social security retirement benefits and Medicare.

28. © 2004 West Legal Studies in Business A Division of Thomson Learning BUSINESS LAW: Cases & Principles Davidson Knowles Forsythe 8 th Ed. 28 EMPLOYMENT Unemployment Insurance: Unemployment Insurance: – Social Security covers unemployment insurance through the Federal Unemployment Tax Act (FUTA). – Represents a coordinated state and federal effort to provide economic security for temporarily unemployed workers.

29. © 2004 West Legal Studies in Business A Division of Thomson Learning BUSINESS LAW: Cases & Principles Davidson Knowles Forsythe 8 th Ed. 29 EMPLOYMENT Workers’ Compensation. Workers’ Compensation. – Provide financial benefits to reimburse workers for workplace related injury or death. – Compensation does not refer to wages or salaries but to money paid by the employer to indemnify the worker. – Imposes strict liability on the employer for injuries to employees during the scope to their employment.