Lecture Dynamic business law - Chapter 42: Employment and labor law

After reading this chapter, you will be able to answer the following questions: What are wage and hour laws? What are the rights of employees and obligations of employers under the Family and Medical Leave Act? What is FUTA? What are the rules regarding workers’ compensation? What is COBRA? What is ERISA? What is OSHA? What does it mean to be an “at-will” employee?...

Employment and Labor 

Law

  42­2

The Fair Labor Standards Act (FLSA)

 Covers all employers engaged in interstate commerce

 Requires that a “minimum wage” of specified amount 

be paid to all covered employees

 Specified amount periodically raised by Congress

Leave Act (FMLA)

Requires certain employers to establish policy that 

provides all eligible employees with up to 12 

weeks of unpaid leave during any 12­month 

period for specified family­related occurrences 

(Examples:  birth/adoption of child, care for 

seriously ill spouse/parent/child)

Federal Unemployment Tax 

Act (FUTA)

Created state system that provides  unemployment compensation to qualified 

employees who lose their jobs

 State laws that provide financial compensation to employees 

or their dependents when covered employee injured/killed on  the job

 To recover workers’ compensation benefits, injured party must  demonstrate

compensation program

 Injury occurred “on the job”

  42­6

The Consolidated Omnibus Budget 

Reconciliation Act (COBRA)

 Ensures that when employees lose their jobs or have their 

hours reduced to level at which  they are not eligible to receive  medical, dental, or optical benefits from their employer, 

employees have right to continue receiving benefits under 

employer’s policy for up to 18 months by paying the 

premiums for the policy

 Employee fired for “gross misconduct”; or

 Employer decides to eliminate benefits for all current 

employees

and health plans in private industry to provide protection for individuals enrolled in  these plans

controlling plan assets

Right to sue for benefits and breaches of fiduciary duty

  42­8

The Occupational Safety and Health Act of 1970 

(OSHA)

employment…free from recognized hazards that are likely to cause death 

or serious physical harm”

setting safety standards under OSHA

enforcing the Act through inspections and levying of fines against violators

(In states that have adopted any of these three exceptions, employees may 

be able to sue for “wrongful discharge”)

  42­10

Exhibit 42­3:  “At­Will” 

Employment

May an employer fire an at­will employee based 

on…

 Gender?

 Race?

 Political Party?

 No Reason?

 No

 No

 Yes

 Yes

policies, control of access to medical and personnel records, drug testing, and e­ mail policies

disclose the content of those conversations

that they discontinue listening to any conversation once they determine it is  personal

including e­mail and cellular phones

  42­12

Labor Law

for “collective bargaining”

of employees to determine conditions of employment

some of the powers unions had acquired under Wagner Act

referred to as National Labor Relations Act

officials

to protect employees from their own unions

  42­14

Labor Law (Continued)

Relations Act

workers want to be represented by a union

Relations Act

Both employer and employee bargaining unit representative must:

notice to other party, with offer to confer over proposals, and give thirty  days’ notice to federal/state mediation services in event of pending dispute  over new agreement

  42­16

Strikes, Pickets, and Boycotts

 Strike:  Temporary, concerted withdrawal of labor

 Picket:  Designed to inform public (usually through public  demonstration and/or speech) of labor dispute

 Boycott:  Refusal to deal with, purchase goods from, or work  for a business