1. BUSINESSES, WORKERS, AND THE LAW
Chapter 5
BUSINESSES, WORKERS, AND THE LAW
CHAPTER 5.1

2. LAWS THAT REGULATE BUSINESSES
Chapter 5
LAWS THAT REGULATE BUSINESSES
Government Regulation of Business
Regulations are rules that government agencies issue to implement laws.
6 areas of law that affect businesses:
Corporate Law
Tax Law
Intellectual Property Law
Consumer Law
Commercial Law
Licensing and Zoning Law

3. Chapter 5
CORPORATE LAW

4. Chapter 5
Corporate Law
Corporate law regulates how businesses can set themselves up to operate as companies.
There are laws regulating 3 kinds of business ownership:
Sole proprietorship
Partnership
Corporations

5. Chapter 5
Sole Proprietorship
Sole Proprietorship is a business owned by a single individual, or proprietor.
Easy to start
Check with state and local officials about licenses, zoning regulations, etc.
Advantages?
Disadvantages?

6. Chapter 5
Partnerships
Partnerships are associations of two or more persons who jointly own a for-profit business
Governed by the Uniform Partnership Act
Must be two or more persons
Partners must share the profits from their business
Advantages?
Disadvantages?

7. Chapter 5
Corporations
Corporations are businesses formed under state or federal statutes that are authorized to act as a legal person
Advantages?
Disadvantages?

8. Chapter 5
Tax Law

9. Chapter 5
Tax Law
Tax law regulates how much money businesses must pay the government to help provide services for the public
The type of ownership managers choose for their businesses often depends on the types of taxes involved
Taxes are monies paid by corporations and individuals and used to fund government programs and services, such as highways and schools

10. Income Tax Income Tax is a tax levied against a business’s profits
Chapter 5
Income Tax
Income Tax is a tax levied against a business’s profits
A percentage of what a business has earned

11. Chapter 5
Property Tax
Property Taxes are taxes levied against the property, buildings, or land owned by a business
Based on an assessed valuation (worth)

12. Withholding Federal Taxes
Chapter 5
Withholding Federal Taxes
Businesses also collect taxes from workers
Businesses withhold income taxes from employees’ earnings and send them to the federal government

13. Intellectual Property Laws
Chapter 5
Intellectual Property Laws

14. Intellectual Property Laws
Chapter 5
Intellectual Property Laws
Intellectual property laws protect the inventions and new ideas of businesses
3 kinds of intellectual property protections:
Patents
Trademarks
Copyrights

15. Chapter 5
Patents
Patents are documents the federal government issues to inventors and companies that gives them the exclusive right to make, use, and sell their inventions for 17 years

16. Chapter 5
Trademarks
Trademark a word, name, symbol, or slogan a business uses to identify its own goods and set them apart from others
Companies apply to the federal government’s patents and trademark office to establish a new trademark
Registered trademarks are good for 10 years and can be renewed every additional 10 years

17. Copyrights Copyright is the protection provided to a creative work
Chapter 5
Copyrights
Copyright is the protection provided to a creative work
Literary works, musical compositions, plays, dances, paintings, movies, maps, computer programs
The owner is the only one allowed to reproduce, sell, or allow others to use it
US Copyright Office grants copyrights which last for the holder’s life plus 70 years. After that, it becomes part of the “public domain.”

18. Chapter 5
Consumer Law

19. Chapter 5
Consumer Law
Consumer law protects individuals against business activities that might be harmful to them
It is important for consumers to understand consumer laws so they know their rights when dealing with businesses

20. Federal Trade Commission
Chapter 5
Federal Trade Commission
FTC is an agency of the federal government that will take action against a company if it receives enough consumer complaints to establish a “pattern of wrongdoing.”
Used Car Rule
Telemarketing Sales Rule

21. Food & Drug Administration
Chapter 5
Food & Drug Administration
FDA protects consumers against problems with mislabeled and impure foods, drugs, cosmetics, and medical devices.
FDA approves all new drugs before they are sold.

22. Chapter 5
Commercial Law

23. Chapter 5
Commercial Law
Commercial law regulates how businesses enter into contracts with other businesses and with consumers
Uniform Commercial Code is the basic commercial law document

24. Chapter 5
Contracts
Contracts are agreements between two parties to carry out a transaction, such as the sale of goods from a seller to buyer
Create obligations between the parties that can be enforced in a court of law
Must follow very specific rules to stand up in court

25. Business Sales Contracts
Chapter 5
Business Sales Contracts
Business sales contracts are often short, simple documents that meet the requirements of the Uniform Commercial Code

26. Licensing and Zoning Law
Chapter 5
Licensing and Zoning Law

27. Licensing and Zoning Law
Chapter 5
Licensing and Zoning Law
State and local governments use licensing as a way to limit and control people who plan to enter certain types of businesses
Government may deny your application, take away a license, issue warnings, suspend, or completely revoke a license
Local governments regulate businesses through building codes and through zoning ordinances and regulations

28. Chapter 5
Activity
Case Analysis

29. Chapter 5
Workers and The Law
Chapter 5.2

30. The Importance of Employment Laws
Chapter 5
The Importance of Employment Laws
Employment laws regulate the relationship between companies and their workers and give workers significant rights and benefits, including the right to work in a safe environment
There are strict penalties for companies who violate these laws

31. 5 Employment Laws Equal Employment Opportunity (EEO) laws
Chapter 5
5 Employment Laws
Equal Employment Opportunity (EEO) laws
Occupational safety and health laws
Wage-hour laws
Benefit laws
Labor relations laws

32. Equal Employment Opportunity Laws
Chapter 5
Equal Employment Opportunity Laws

33. Title VII of the Civil Rights Act of 1964
Chapter 5
Title VII of the Civil Rights Act of 1964
Companies cannot discriminate against an employee because of race, color, religion, sex, or national origin
EEOC (Equal Employment Opportunity Commission) can sue a company that discriminates against an employee
The employee can also take the company to court

34. Age Discrimination in Employment Act
Chapter 5
Age Discrimination in Employment Act
Companies cannot discriminate against employees because of their age in hiring, promotions, or retirement
Workers between the ages of 40 and 70 can sue employers for discrimination

35. Americans with Disabilities Act
Chapter 5
Americans with Disabilities Act
Companies cannot discriminate against persons with disabilities
Companies cannot fire or refuse to hire people because of certain disabilities and illnesses, such as blindness or diabetes
Companies must also accommodate a worker’s disabilities

36. Occupational Safety and Health Laws
Chapter 5
Occupational Safety and Health Laws

37. Occupational Safety and Health Laws
Chapter 5
Occupational Safety and Health Laws
Occupational Safety and Health Act sets standards for keeping workplaces clean and free of hazards, such as unsafe machinery and dangerous chemicals
Businesses must keep records of employee illnesses, injuries, and deaths and submit them to the US Dept of Labor
OSHA inspectors visit workplaces to make sure they comply with regulations

38. Chapter 5
Wage-Hour Laws

39. Chapter 5
Wage-Hour Laws
Wage-Hour laws establish minimum wage, overtime, and child labor standards for employees
Fair Labor Standards Act (FLSA) protects workers in three ways:
Sets minimum wage companies can pay
Sets number of hours employees can work in a week without receiving overtime pay
Prohibits companies from employing children under the age of 14

40. Chapter 5
Benefits Laws
Benefit laws guarantee that workers will receive certain benefits regardless of what happens to them on the job
Companies must comply with five different benefits laws:
Social Security Act
Employee Retirement Income Security Act
Unemployment Insurance Laws
Workers’ Compensation Laws
Family Medical Leave Act (FMLA)

41. Chapter 5
Social Security Act
Provide workers and their families with income after retirement.
Supports disabled workers and the federal Medicare program, which provides health insurance for senior citizens
Employers and employees share the cost of SS taxes while the worker is employed
When workers retire, they receive a pension based on their lifetime earnings

42. Employee Retirement Income Security Act
Chapter 5
Employee Retirement Income Security Act
ERISA protects the money put into an employee’s retirement fund by companies and workers
Not every company establishes this program

43. Unemployment Insurance Laws
Chapter 5
Unemployment Insurance Laws
Provides workers with financial assistance during period of unemployment
To be eligible for unemployment insurance, workers must meet two requirements:
Must have lost their jobs through no fault of their own
Must have worked a certain length of time
Employers must pay a certain amount into unemployment for each worker

44. Workers’ Compensation Laws
Chapter 5
Workers’ Compensation Laws
All states have laws that insure workers against injury, illness, or death because of job conditions
Employers are liable for an employee’s on-the-job injury no matter how the illness or injury occurs
Covers accidents even if they are the fault of the worker!

45. Family Medical Leave Act
Chapter 5
Family Medical Leave Act
FMLA requires companies to give employees up to 12 weeks of leave to care for a child, spouse, or parent
Law only affects companies of 50 or more employees
Companies don’t have to pay their employees while they are on leave, but must give them their jobs back with no penalties

46. Chapter 5
Labor Relations Laws

47. Chapter 5
Labor Relations Laws
Protect the right of employees to organize into unions to bargain collectively for better wages and working conditions
Unions are groups of workers who collectively bargain for rights such as higher wages and better working conditions
Companies must at least listen to what unions say they want for their members
Organizing
Collective Bargaining
Striking
Strikes are a union’s ultimate weapon

48. Chapter 5
Activity
Chapter 5 Fact and Idea Review