The Legal Environment of Business and Online Commerce, 7e (Cheeseman)
Chapter 20 Employment Law and Worker Protection
1) Before the Industrial Revolution, the doctrine of laissez-faire governed the employment
relationship in the United States.
2) Under common law, employees who were injured on the job could not sue their employers for
negligence.
3) Employees are required to purchase workers’ compensation insurance from private insurance
companies or state funds.
4) For an injury to be compensable under workers’ compensation, the claimant must prove that
he or she was harmed by an employment-related injury.
5) Workers’ compensation insurance does not cover stress and mental illness that are
employment related.
6) Workers cannot both receive workers’ compensation and sue their employers in court for
damages.
7) Workers’ compensation acts bar injured workers from suing responsible third parties to
recover damages.
8) If an employer intentionally injures a worker, the worker cannot collect workers’
compensation benefits.
9) OSHA is a federal administrative agency within the Department of Labor that is empowered
to enforce the Occupational Health and Safety Act.
10) The general duty standard requires an employer to provide a work environment that does not
result in its employees’ mental stress.
11) The OSHA serves only as a model act and employers who violate its rules are not liable for
penalties.
12) Only private employers, and not governmental bodies, come under the purview of the FSLA.
13) The FLSA makes it unlawful to ship goods produced by businesses that use oppressive child
labor.
14) According to the FLSA, children under the age of 14 are forbidden from working, including
as newspaper deliverers.
15) Private civil actions are also permitted under the FLSA.
16) Child actors and performers are exempt from the child labor restriction of the FLSA.
17) The Department of Labor permits employers to pay less than the minimum wage to students
and apprentices.
18) An employee who earns tips must be paid minimum wage by the employer, excluding the
income from tips.
19) States are allowed to enact minimum wage laws that set minimum wages higher than the
federal level.
20) Minimum wage laws cannot be enacted by individual cities in the United States.
21) Living wage laws are minimum wage laws enacted by cities.
22) Overtime pay must always be set at twice the regular pay of an employee.
23) Overtime pay is given to non-exempt employees who work more than 40 hours a week.
24) Executives who are compensated on a salary basis and engage in management are exempted
from overtime pay.
26) Senior professors and physicists in research laboratories are entitled to federal overtime pay.
27) Software developers and other computer professionals cannot claim overtime pay.
28) The FLSA guarantees workers unpaid time off from work for family and medical
emergencies and other specified situations.
29) The COBRA is an act designed to prevent fraud and other abuses associated with private
pension funds.
30) Vesting occurs when an employee has a nonforfeitable right to receive pension benefits.
31) Under FUTA, employers are exempted from paying unemployment taxes.
32) Workers who quit work without just cause can claim unemployment benefits.
33) Before the Industrial Revolution, the doctrine of ________ governed the employment
relationship in the United States.
A) laissez-faire
B) respondeat superior
C) scienter
D) voir dire
34) Which of the following is true of workers’ compensation?
A) Families of workers cannot claim workers’ compensation despite the death of the worker.
B) Workers’ compensation is only awarded for injuries resulting from the job.
C) The claim for workers’ compensation must be filed with the employer.
D) Workers’ compensation is a fixed amount throughout the country.
35) States usually require employers to purchase ________ from private insurance companies or
state funds to cover workers’ compensation claims.
A) employee insurance
B) relief fund insurance
C) provident fund insurance
D) workers’ compensation insurance
36) Which of the following has to be necessarily proved by a claimant pursuing compensation
for an injury, under workers’ compensation?
A) The claimant was harmed intentionally by the employer.
B) The claimant was harmed when he or she was employed by the employer.
C) The claimant was harmed by an employment-related injury.
D) The claimant was harmed unintentionally by the employer.
37) If an employee is injured in an automobile accident while she is driving to an off-premises
restaurant during her personal lunch hour, the injury is ________.
A) covered by workers’ compensation insurance
B) not covered by workers’ compensation
C) covered by workers’ compensation
D) not covered by employee’s medical insurance
38) Workers’ compensation is a(n) ________ remedy.
A) exclusive
B) cumulative
C) provisional
D) equitable
39) Which of the following is true of workers’ compensation?
A) A worker must file a complaint with the police before claiming workers’ compensation.
B) Workers’ compensation is a provisional remedy, not an equitable remedy.
C) A worker who receives workers’ compensation cannot sue his employer.
D) Workers’ compensation is generally awarded as punitive damages of a lawsuit initiated by the
injured employee.
40) What is the employer’s advantage in offering workers’ compensation?
A) The employer need not pay for workers’ compensation insurance.
B) The employer is exempt from having to offer paid medical leave.
C) The employer can avoid a lawsuit by an injured worker.
D) The employer can offer lower basic pay to workers.
41) Jorge, a fork-lift truck operator for retail chain Hansridges, was injured when the fork-lift he
was operating toppled over. The fork-lift truck was manufactured and maintained by Ionic
Machines Inc. As he was covered by workers’ compensation insurance, he could recover
workers’ compensation benefits. However, it was later found that the fork-lift truck was not
designed to be used to lift as much weight as Ionic Machines claimed it could. Which of the
following legal rights is Jorge entitled to?
A) sue Hansridges for injuries suffered during employment
B) sue Hansridges for hazardous work environment
C) sue Ionic Machines for damages
D) not sue anyone as he has already received workers’ compensation
42) In which of these situations can an employee sue an employer to recover employment-related
injuries?
A) The employer is self-insured.
B) The employer unintentionally injures a worker covered under workers’ compensation.
C) The employee suffers an injury at work premises that is not related to work.
D) The employer intentionally injures a worker covered under workers’ compensation.
43) The ________ is federal act enacted in 1970 that promotes safety in the workplace.
A) OSHA
B) FLSA
C) FMLA
D) ERISA
44) The OSHA guidelines that set safety rules for specific equipment, procedures, types of work,
unique work conditions, and the like are known as ________.
A) standard of wellness
B) specific duty standards
C) code of direction
D) general standard of work
45) The ________ is an OSHA standard that requires an employer to provide a work
environment free from recognized hazards that are causing or are likely to cause death or serious
physical harm to employees.
A) general duty standard
B) specific duty standard
C) code of wellness
D) provision of nonhazardous work environment
46) Which of the following is true of OSHA’s general duty standard?
A) The standard needs to be established with each safety regulation.
B) It requires an employer to provide a working environment that does not result in mental stress
of the employee.
C) An employer is obliged to provide a work environment that is free from recognized hazards.
D) OSHA has no say in safety violations of an employer as it is just a model act.
47) The FLSA applies to ________.
A) employees in government organizations
B) employees earning less than minimum wages
C) employees engaged in the production of goods for interstate commerce
D) self-employed US citizens
48) The ________ forbids the use of oppressive child labor and makes it unlawful to ship goods
produced by businesses that use oppressive child labor.
A) OSHA
B) ERISA
C) FMLA
D) FLSA
49) According to the Department of Labor, children under the age of 14 can only be employed as
________.
A) stocking staff at stores
B) newspaper deliverers
C) waiters
D) store assistants
50) Which of the following is true of child labor regulations adopted by the Department of
Labor?
A) Children between the ages of 14 and 15 may work unlimited hours in nonhazardous jobs.
B) Children between the ages of 16 and 17 may work limited hours in hazardous jobs.
C) Children under the age of 14 may work limited hours in nonhazardous jobs.
D) Children employed in agriculture have no time or work restriction.
51) Who among the following are exempt from child labor restrictions in the United States?
A) children who work as newspaper deliverers
B) children who work at restaurants or fast-food stalls
C) children employed in the performing arts
D) children employed in gasoline stations
52) Which of the following is true of the federal minimum wage?
A) An employer may not reduce minimum wage although he or she provides other benefits like
food to the employees.
B) Managerial employees are not subject to minimum wage requirements.
C) Apprentices cannot be paid less than minimum wages.
D) Employees who earn tips, such as waiters and valets, are not entitled to minimum wage.
53) Which of the following acts establishes minimum wage and overtime pay requirements for
workers in the U.S.A.?
A) FLSA
B) OSHA
C) FMLA
D) COBRA
54) Which of the following is true of minimum wages in the United States?
A) States can enact laws that set minimum wages higher than the federal minimum wage.
B) Cities are not allowed to have minimum wages different from what is set by the state or
federal government.
C) Living wage laws set lower minimum wages than the federal level.
D) An employee who earns in tips must be paid minimum wage by the employer.
55) Overtime pay is ________ times that of the regular pay of an employee.
A) two
B) three
C) two and a half
D) one and a half
56) Overtime pay is paid for each hour worked in excess of ________ hours that week.
A) 35
B) 40
C) 45
D) 50
57) Jerry is employed by U.S.-based Iconic Systems. His work hours per week for the month of
January were 40 hours the first week, 30 hours the second week, 50 hours the third week, and 45
hours the fourth week. According to the FSLA, how many hours of overtime pay is Jerry entitled
to at the end of January?
A) 5
B) 10
C) 15
D) 40
58) Who among the following is exempt from federal minimum wage requirement?
A) Kelly, a sales executive at a pharmacy
B) John, a waiter by day and a guitar teacher by night
C) Tsun, a software applications developer
D) Orlando, a telemarketer
59) Which of the following statements is true of exemptions to minimum wage and overtime pay
requirements?
A) Apprentices must be paid minimum wage.
B) Learned professionals need not be paid minimum wage.
C) Workers involved in hazardous activities need not be paid minimum wage.
D) Employees in law enforcement and medical sectors need not be paid minimum wage.
60) Helga works as a nurse in a government-run hospital. She has to work 40 hours a week, from
10 pm to 6 am every day. Which of the following is true of this scenario?
A) Helga is not entitled to receive overtime pay as medical staff does not qualify for it.
B) Helga can receive minimum wages and overtime pay only if she works more than 60 hours a
week, as she is a government employee.
C) Helga cannot receive overtime pay as government employees are exempt from it.
D) Helga can receive overtime pay if she works more than 40 hours a week.
61) The ________ guarantees workers unpaid time off from work for family and medical
emergencies and other specified situations.
A) FLSA
B) OSHA
C) FMLA
D) ERISA
62) To be covered by the FMLA, an employee must ________.
A) have worked for the employer for at least six months
B) have performed more than 1,250 hours of service
C) not have claimed maternity leave in the past
D) be suffering from a serious injury or ailment
63) The ________ is a federal law that permits employees and their beneficiaries to continue
their group health insurance after an employee’s employment has ended.
A) FLSA
B) FMLA
C) ERISA
D) COBRA
64) The ________ is a federal act designed to prevent fraud and other abuses associated with
private pension funds.
A) ERISA
B) COBRA
C) FLSA
D) FMLA
65) ________ occurs when an employee has a nonforfeitable right to receive pension benefits.
A) Vesting
B) Easement
C) Anti-lapse
D) Reconciliation
66) Under the ________ and state laws enacted to implement the program, employers are
required to pay unemployment contributions.
A) FLSA
B) FMLA
C) FUTA
D) FICA
67) Which of the following benefits is a component of Social Security benefits?
A) workers’ compensation
B) legal assistance
C) unemployment compensation
D) disability benefits
68) Which of the following is true of Social Security?
A) Social Security operates like a savings account.
B) Contribution to the Social Security fund is entirely derived from employers.
C) Employers remit Social Security payments to the IRS.
D) Self-employed individuals are exempted from Social Security payments.
69) “Workers’ compensation is an exclusive remedy.” Elaborate on this statement with the help
of an example.
70) Describe the measures taken by the U.S. Department of Labor against oppressive child labor.
71) Outline the minimum wage requirement established by the FLSA. How are wages given to a
tipped employee?
72) What is the Family and Medical Leave Act? How is an employee covered under it?
73) How is Social Security awarded in the U.S.A.?
74) The workers’ compensation is a(n) ________ remedy where workers cannot receive workers’
compensation and sue their employers in court for damages.
75) ________ is a federal agency that is empowered to inspect places of employment for health
hazards and safety violations.
76) OSHA standards establish safety requirements for safety guards on saws. This is an example
of a(n) ________ standard.
77) The ________ Act contains a general duty standard that imposes on an employer a duty to
provide employment and a work environment that is free from recognized hazards that are
causing or are likely to cause death or serious physical harm to its employees.
78) The Fair Labor Standards Act is enforced by the ________.
79) The ________ Act forbids the use of oppressive child labor and makes it unlawful to ship
goods produced by businesses that use oppressive child labor.
80) Under the FLSA, an employer cannot require nonexempt employees to work more than 40
hours per week unless they are paid ________ of one-and-a-half times their regular pay for each
hour worked in excess of 40 hours that week.
81) The ________ exemption is an exemption that applies to employees who will be paid by the
client or customer, whose primary duty is making sales or obtaining orders or contracts for
services, and who are customarily and regularly engaged away from the employer’s place of
business.
82) The ________ is a federal act that guarantees workers up to twelve weeks of unpaid leave in
a twelve-month period to attend to family and medical emergencies and other specified
situations.
83) The federal law called ________ permits employees and their beneficiaries to continue their
group health insurance after an employee’s employment have ended.
84) According to the ________ Act, government employees can continue their group health
insurance after termination of employment if they wish to do so.
85) Under ERISA, ________ occurs when an employee has a nonforfeitable right to receive
pension benefits.
86) To assist workers who are temporarily unemployed, the ________ Act requires employers to
pay unemployment contributions.
87) The ________ system was established to provide limited retirement and death benefits to
covered employees and their dependents.
88) Under the ________ Act, employees must make contributions (i.e., pay taxes) into the Social
Security fund.
89) Self-employed individuals are required to pay Social Security contributions under the
________ Act.