978-0077733735 Chapter 23 Lecture Notes

Type

Solution Manual

Book Title

Business Law with UCC Applications 14th Edition

ISBN 13

978-0077733735

April 10, 2019

Chapter 23 - Employment Law

Chapter 23

Employment Law

I. Key Terms

Affirmative action (p. 567) Metadata (p. 572)

Business necessity (p. 565) Military caregiver leave (p. 562)

Collective bargaining agreement (p. 550) Qualifying exigency leave (p. 562)

Constructive discharge (p. 557) Quid pro quo sexual

Disability (p. 569) harassment (p. 567)

Disclaimer (p. 554) Reasonable accommodation (p. 570)

Disparate impact (p. 565) Retaliation (p. 558)

Disparate treatment (p. 565) Reverse discrimination (p. 567)

Employment-at-will (p. 549) Social media policy (SMP) (p. 572)

Employment contracts (p. 550) Undue hardship (p. 570)

Genetic Information Nondiscrimination Whistleblower (p. 572)

Act GINA (p. 570) Workers’ compensation (p. 562)

Grievance procedure (p. 550) Workplace harassment (p. 566)

Hostile work environment (p. 567) Wrongful discharge (p. 552)

Implied contract (p. 554)

II. Learning Objectives

1. Explain the doctrine of employment-at-will.

2. Itemize the statutory situations that fall outside employment-at-will.

3. Explain the contractual situations that fall outside employment-at-will.

4. List the wrongful discharge exceptions to employment-at-will.

5. Explain the after-acquired evidence rule.

6. Explain the laws regulating employee working conditions.

7. Outline the laws providing worker benefits.

8. Explain the evolution of the Civil Rights Legislation.

9. Explain the protections provided by the Age Discrimination in Employment Act.

10. Explain the nature of and the need for a social media policy.

III. Major Concepts

23-1 The Employment Relationship

Under the employment at will doctrine, an employer can dismiss an employee at any time

for any reason. Employees who belong to labor unions and individuals with the power to

negotiate their own employment contracts would not be affected by employment-at-will.

Wrongful discharge gives employees legal grounds for a lawsuit against employers who

have dismissed them unfairly. The courts have used several theories to judge the

injustice of a dismissal. These include promissory estoppel, fraud, implied contract,

implied covenant, public policy tort, and intentional inflection of emotional distress.

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23-2 Laws Regulating Employment Conditions

OSHA establishes and enforces occupational health and safety standards with which

employers must comply. The principal federal law affecting the wages and hours of

employees is the Fair Labor Standards Act. The act provides that workers in interstate

commerce or in an industry that produces goods for sale in interstate commerce must be

paid no less than a specified minimum wage. The federal Immigration Reform Act of

1986 created a national employment verification system that placed responsibility on the

employer for verifying the identity and employment of all employees.

23-3 Worker Benefits

Federal and state governments participate in programs designed to reduce the financial

risk to workers by reason of their unemployment, disability, hospitalization, retirement,

and death. The principal federal law covering these risks is the Social Security Act of

1935. Under the Federal Unemployment Tax Act, each state operates its own

unemployment insurance system, subject to conditions established by the federal

government. Workers’ compensation laws are in effect in all states. These statutes

compensate covered workers or their dependents for injuries, disease, or death that

occurred on the job or as a result of it. ERISA provides needed supervision over

employee pension plans established by many employers. Under provisions of the Family

and Medical Leave Act (FMLA), employers who have 50 or more employees must give

those employees up to 12 weeks of leave time for child, spousal, or parental care.

23-4 Equal Employment Opportunity

The Civil Rights Act of 1964 prohibits discrimination based on race, color, creed, gender,

and national origin. Employees who believe they have been discriminated against can file

a complaint with the EEOC. Discrimination can be committed in one of two ways:

disparate treatment or disparate impact. Other steps toward equality in employment

include the Age Discrimination in Employment Act, the Uniformed Services

Employment and Reemployment Rights Act, and the Americans with Disabilities Act.

23-5 Social Media Policies

A social media must be written in a language and a style that is precise, exact, plain, and

explicit. The policy must also be given to the employees with the understanding that they

will read and comprehend the details of the policy. Moreover, employees must be told

that the employer intends to monitor their e-mail accounts and their online work. The

employer must also let the employees know what activities are forbidden. In addition, it

would be helpful to outline what activities are acceptable when using social media in the

workplace. Once the policy has been written and explained to the employees, each of

them should be given two copies of the policy. The employer should reserve the right to

make alterations in the policy. The employer needs to remember that even after the policy

is distributed and the employees have been warned, there are limits to what an employer

can do about violations of the policy.

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Chapter 23 - Employment Law

IV. Outline

I. The Employment Relationship (23-1)

A. Employment-at-Will

1. Most jurisdictions in the United States still follow the doctrine of employment-at-will

which states that an employer can dismiss an employee at any time for any reason.

2. The rationale for employment-at-will is that both the employer and the employee

should be free to terminate the employment relationship at any time.

3. The law has created certain exceptions to the general rule of employment-at-will

falling into three categories: contractual exceptions, statutory exceptions, and court

created wrongful discharge exceptions.

B. Contractual Exceptions

1. Individuals with unique abilities, special talents, or a highly specialized education

often have the power to negotiate their own employment contracts.

2. Such individuals would not be affected by employment-at-will.

3. A collective bargaining agreement is a contract negotiated by an employer and a labor

union covering all issues related to employment.

C. Contractual Details

1. To be valid and enforceable, a contract must contain some key details.

2. The following details add a level of certainty, honesty, and seriousness.

a. If appropriate, a provision outlining the length of time the employment relation

will last or a statement that, even given the establishment of a contract,

employment remains at will.

b. A section identifying the parties and identification of which is the employer and

which is the employee.

c. A statement that the employer expects the employee to know and obey rules and

codes.

d. For arrangements that are not at will, information regarding discipline and causes

for discharge.

e. A clause establishing the need for confidentiality.

f. A section explaining the employee’s access to electronic systems, the employer’s

ownership, that employees have no expectation of privacy, and that work will be

monitored.

g. A statement that the contract may be assigned only to the employer’s successors.

h. A choice-of-law provision.

i. A statement, if applicable, indicating whether arbitration is required and details.

j. A section addressing any tax issues associated with the employment agreement.

k. A section on separation pay.

l. A section that includes details of compensation.

m. A section outlining the termination process.

n. A section explaining any change of control provisions.

o. A restrictive employment covenant including trade secret protection.

p. A section outlining any indemnification provisions.

q. A section that permits the employee to seek the advice of an attorney before

committing to the arrangement.

D. Statutory Exceptions

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1. The federal government has passed legislation altering the at-will doctrine.

2. The government has been interested in protecting employees from discrimination

based on race, color, creed, national origin, and gender.

3. Later, statutory law was passed to prevent discrimination based on age, disability,

service in the armed forces, and from hardship resulting when a business is closed or

moved.

4. The employment-at-will rule is limited by civil rights legislation.

5. Due to civil rights legislation, an employer cannot discharge an employee if the only

reason for the discharge is membership in one or more of the protected classes.

6. Many employers who contemplate mass layoffs and/or plant closings must comply

with the provisions of the Worker Adjustment and Retraining Notification Act

(WARN).

7. With some exceptions, employers with over 100 full-time employees must give notice

at least 60 days before a plant closing or mass layoff.

E. Wrongful Discharge

1. Wrongful discharge, also referred to as unjust dismissal, gives employees legal

grounds for a lawsuit against employers who have dismissed them unfairly.

2. Theories of wrongful discharge include promissory estoppels, fraud, implied contract,

implied covenant, public policy tort, and the intentional infliction of emotional

distress.

3. Promissory estoppel involves (1) a promise made by an employer that (2) the

employer could reasonably expect would be relied on by the employee (3) reliance by

the employee resulting in the employee doing or refraining from doing something and

(4) harm to the employee.

4. Some states permit an employee to bring a wrongful discharge based on fraud which

generally only applies to false promises made by a prospective employer to a possible

future employee who then relies on those promises to his or her detriment.

5. Implied contract involves an employment relationship that would have been at-will

had the employer or an agent of the employer not said, done, written, or printed

something that created a workplace environment that implying the existence of a

contract.

6. Many jurisdictions recognizing the implied contract exception still allow employers

to preserve an employment-at-will arrangement by using a disclaimer although, even

then, a disclaimer might prove ineffective if the employer made a specific promise.

7. An employee who can prove that his or her discharge somehow violated public policy

may recover damages in tort.

8. Public policy is the broad legal principle that says that the courts will not allow

anyone to do anything that injures the public at large.

9. An employee in some jurisdictions may be able to rely on the theory of implied

covenant which holds that there is an implied promise in any employment

relationship that the employer and the employee will be fair and honest with each

other.

10. An employee may attempt to recover damages for the intentional infliction of

emotional distress if the conduct of the employer in the discharge of the employee

caused serious mental and emotional suffering.

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11. To succeed in an action based on the intentional infliction of emotional distress, a

plaintiff must prove that the employer’s conduct was extreme, that the employer knew

the conduct was extreme and would result in emotional distress, and that the conduct

was the proximate cause of serious mental and emotional suffering.

F. After Acquired Evidence Defense

1. The after acquired evidence defense is applied when an employer uncovers evidence

that reveals that the employer could have legitimately discharged the employee, even

if the employee’s claims of wrongful discharge prove to be true.

2. This defense is often raised as grounds for granting a summary judgment.

G. Retaliation and Constructive Discharge

1. Sometimes employers will engage in conduct that adversely affects the employee’s

working conditions without actually terminating the employment relationship itself

leading to a constructive discharge involving the employee’s “voluntarily” leaving the

job.

2. In some states, a constructive discharge is actionable in court.

3. If the constructive discharge is conducted as retaliation for an employee’s actions, the

lawsuit may be found not only in tort law, as in public policy tort, but also in federal

legislation for types of protected employee action.

II. Laws Regulating Employment Conditions (23-2)

A. Health and Safety Laws

1. On the state level, departments of labor and health may be charged with determining

whether an employer is complying with state health and safety laws.

2. On the federal level, the Occupational Safety and Health Administration establishes

and enforces occupational health and safety standards with which employers must

comply.

B. Fair Labor Standards Act

1. The Fair Labor Standards Act requires that workers in interstate commerce be paid no

less than a specified minimum wage, provides that workers cannot work for more

than forty hours per week unless they are paid time and a half for overtime, prohibits

the employment of children under the age of fourteen, and prohibits the use of

“oppressive child labor”.

2. The wage and hour provisions of the FLSA permit the employment of learners,

apprentices, and messengers at less than minimum wage.

3. The wage and hour provisions of the FLSA, with certain exceptions, do not apply to

people employed in an executive, administrative, or professional capacity.

4. Certain other employees, such as government employees, are also exempted from the

wage and hour provisions.

C. Identity and Employment Eligibility

1. The federal Immigration Reform Act of 1986 created a national employment

verification system that placed responsibility for verification of the identity of all

employees on the employer.

2. Job applicants must present original documentation.

III. Worker Benefits (23-3)

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A. Social Security

1. Under the Federal Insurance Contributions Act, both employers and employees are

taxed equally to help pay for the loss of income of workers upon retirement.

2. The employee’s contribution is held back by the employer who then provides a

matching contribution.

3. The Social Security Administration will pay benefits to retired workers who are

eligible under the plan.

B. Unemployment Insurance

1. The unemployment insurance section of the Social Security Act provides for a joint

federal and state system of unemployment insurance.

2. Under the Federal Unemployment Tax Act, each state operates its own unemployment

insurance system, subject to conditions established by the federal government.

3. In order to receive unemployment insurance, unemployed individuals must be ready,

willing, and able to work.

C. Workers’ Compensation

1. Workers’ compensation laws are in effect in all states.

2. The statutes compensate covered workers or their dependents for injuries, disease, or

death that occurred on the job or as a result of it.

D. Pension Plan Regulation

1. The Employee Retirement Income Security Act (ERISA) provides needed supervision

over employee pension plans that are established by many employers.

2. Under the act employers must place their pension contributions made on behalf of

employees into a pension trust, independent of the employer; and other specific

regulations are also in place.

E. Family and Medical Leave Regulation

1. Employers with fifty or more employees at the workplace, or within 75 miles of the

workplace, must give employees up to twelve weeks of leave time in a twelve-month

period for child, spousal, or parental care, or for the employee’s own serious medical

condition if that condition necessitates either in-patient treatment or medical care on a

continuing basis.

2. The leave time may be unpaid, but it must not jeopardize the job of the employee.

3. There are employment requirements for qualification purposes.

4. Leave may be taken intermittently.

5. Congress amended the Family Medical Leave Act in 2009 to accommodate military

caregivers.

a. Under these new provisions, an employer must give an employee up to 26 weeks

of leave time in a 12-month period to care for a family member who has sustained

a serious illness or injury that occurred because of military service.

b. In addition, employees are permitted to use as much as 20 weeks to take care of

certain nonmedical emergencies during the time that a spouse, child, or parent is

on active duty in the military.

IV. Equal Employment Opportunity (23-4)

A. Civil Rights Legislation

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1. The process of establishing civil rights legislation began in the 19th century in the

wake of the Civil War with the adoption of three major constitutional amendments -

Amendment 13 abolishing slavery, Amendment 14 guaranteeing due process and

equal protection of the law, and Amendment 15 guaranteeing voting rights.

2. The above sections all end with the provision that “Congress shall have the power to

enforce this article by appropriate legislation.”

3. It is now indisputable that all of the principles set forth in the Bill of Rights and all

subsequent rights-oriented amendments must be protected by the states as well as by

Congress.

B. The Equal Pay Act

1. The Equal Pay Act set the stage for the Civil Rights Act of 1964.

2. Under provisions of the federal Equal Pay Act, employers must pay women the same

amount that they pay men for the same job.

C. Title VII of the Civil Rights Act of 1964

1. The Civil Rights Act of 1964 covers more than employment.

2. The Civil Rights Act of 1964 outlaws discrimination in such things as housing, travel,

accommodations, and education.

3. The Civil Rights Act of 1964 prohibits discrimination based on race, color, religion,

gender, and national origin.

4. Employees who believe they have been discriminated against can file complaints with

the Equal Employment Opportunity Commission (EEOC) or state deferral agencies.

5. Discrimination can be committed through disparate treatment or disparate impact.

a. Disparate Treatment

(a) In cases of disparate treatment, the employer intentionally discriminates

against an individual or a group belonging to a protected class.

(b) In some cases, but not those involving racial discrimination, a claim of bona

fide occupational qualification may be used as a defense.

b. Disparate Impact

(a) Discrimination through disparate impact, also called adverse impact, occurs

when an employer has a policy that on the surface seems neutral but in

practice has an unequal and unfair impact on the members of one or more

protected classes.

(b) Business necessity may be a defense.

6. Courts have witnessed an increase in the number of workplace harassment claims.

7. The first type of harassment claims were sexual harassment claims.

a. Quid pro quo sexual harassment occurs when a supervisor makes unwelcome

sexual advances towards a subordinate or suggests that the subordinate trade

sexual favors for preferential treatment.

b. A hostile work environment occurs when misconduct pervades the workplace to

the extent that conditions become distressing, offensive, or hostile.

8. The law has begun to recognize that a hostile work environment need not be limited

to sexual situations and may involve religion, color, creed, or national origin.

9. Affirmative action refers to a practice by which an employer actively pursues a policy

that will reduce the effects of past discrimination in the workplace.

a. Affirmative action is neither mandated nor prohibited by the Civil Rights Act.

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b. Generally affirmative action plans come from a court order as the result of a court

case.

c. Reverse discrimination is a term that refers to a practice that is designed to

eliminate discrimination against the members of a protected class, but has the

opposite effect on other members of that class or on the members of another

protected class.

d. To respond to claims of reverse discrimination, the Supreme Court has issued

guidelines including that affirmative action plans promote a compelling state

interest and be finely drawn to minimize harm to workers not included in the plan.

D. Amendments to the Civil Rights Act

1. Congress has amended the Civil Rights Act many times with a major overhaul

occurring in 1991 to revitalize the doctrine of disparate impact and expand available

remedies.

2. The 1991 amendments mandated that American businesses must give U.S. citizens

working abroad the same protection against discrimination given to workers in the

U.S.

3. The 1978 amendment to Title VII of the Civil Rights Act makes it clear that

employers cannot discriminate on the basis of pregnancy.

4. Amendments to the Equal Pay Act specify that the time limit for filing a claim with

the EEOC begins to run every time the worker is paid and adds additional remedies.

5. In after acquired evidence cases, the EEOC has adopted an approach applying only to

cases involving the EEOC that the Commission will not require that the employer

rehire the claimant, nor will the Commission attempt to recover backpay or

compensatory damages that arise after the time that the after acquired evidence was

obtained, but the EEOC will still seek punitive damages in such cases.

E. Age Discrimination in Employment Act

1. For employers who come within the provisions of the act, the ADEA prohibits

discrimination on the basis of age for persons forty or older.

2. The ADEA is administered by the EEOC.

3. If age is a true job qualification, the law does not apply.

4. An amendment to the act called the Older Workers’ Benefit Protection Act (OWBPA)

makes it clear that the ADEA forbids discrimination against older workers in the

handling of their employee benefit and retirement plans.

5. The OWPBA also gives older workers legal recourse if they are forced or tricked into

giving up their rights under the ADEA.

F. Uniformed Services Employment and Reemployment Rights Act

1. Under USERA an employee who has served in the armed forces and who has

successfully completed his or her tour of duty is entitled, upon returning to work, to

be reinstated in his or her previous job position.

2. The USERA is administered by the Office of Veterans’ Employment and Training

Service.

G. Americans with Disabilities Act

1. The act is divided into titles referencing private-sector employers and public services

and transportation.

2. A disability is any physical or mental impairment that substantially limits one or more

of the major life activities.

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3. The ADA forbids discrimination on the basis of disability if the disabled individual

can do the essential functions of the job with “reasonable accommodations.”

4. An accommodation will be reasonable if it permits the disabled individual to

accomplish the essential functions of the job without imposing an undue hardship on

the employer.

5. The ADA also prohibits discrimination on the basis that a person is associated with a

disabled person.

H. The Genetic Information Nondisclosure Act.

1. The Genetic Information Nondiscrimination Act (GINA). GINA was written to

protect employees by making it unlawful for employers and health insurance

companies to make decisions based on any genetic information that they have

acquired due to any type of genetic testing.

2. Employers, unions, employment agencies, and joint labor–management committees

cannot request, require, or purchase genetic information, unless required by law, used

to protect individuals from toxic substances, or as part of a forensic investigation for

law enforcement purposes.

I. The Whistleblower Acts

1. A whistleblower can be defined as an individual who notifies official federal or state

authorities about illegal activities that take place in business, government, and other

similar settings.

2. The fact that whistleblowers can often be subjected to retaliatory actions by

employers, landlords, law enforcement officials, and other authority figures has

prompted the passage of federal and state laws that protect individuals who have

identified and reported cases of fraud, discrimination, cover-ups, and other similar

illegal activities to the appropriate watchdog agencies.

J. Anti-Retaliation Safeguards

1. Employees may face retaliation after filing a complaint, cooperating with

investigations, or working against discrimination.

2. To demonstrate that retaliation has occurred, an individual must show:

a. that he or she is in a protected class;

b. that retaliation did take place; and

c. that the retaliation took place because of an action that is protected under the law.

3. Protected classes include, race, color, creed, national origin, gender, age, and

disability.

V. Social Media Policies

A. The Social Media Culture

1. To the business person it is not just the devices that are important—is the data itself.

2. Keeping trade secrets and protecting a client’s or an employee’s privacy may also

mean protecting data and, at times, metadata which is data about data

B. The Nature of a Social Media Policy

1. Every business needs to write and enforce a social media policy.

2. A social media policy (SMP) is a set of rules written by an employer telling

employees what they can and cannot do when using electronic communication

devices, formats, websites, and other electronic messaging techniques, such as blogs ,

text messages, tweets, skype transmissions, and e-mails.

C. The Hazards Involved in Social Media

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1. Social media can be used to disclose trade secrets or other company information that

is best kept confidential.

2. It can be used to harass fellow workers or customers or to defame them or perhaps to

invade their privacy.

3. There are also legal limits set down by the Federal Trade Commission that might be

violated inadvertently by the improper use of social media.

4. The Proper Way to Construct a Social Media Policy

a. The policy must be written in a language and a style that is precise, exact, plain,

and explicit.

b. The policy must be given to the employees with the understanding that they will

read and comprehend the details of the policy.

c. Employees must be told up front that the employer intends to monitor their e-mail

accounts and their online work.

5. The Content of a Social Media Policy

a. The employer must let the employees know what activities are forbidden.

b. It would be helpful to also outline appropriate activities.

6. The Procedures Associated with a Social Media Policy

a. Once the policy has been written and explained to the employees, each of them

should be given two copies of the policy, one to sign and return for their personnel

file and one to keep as a reminder of what is expected of them.

b. The employer should reserve the right to make alterations in the policy as

experience reveals situations and events that were not predicted by the original

policy.

c. It is also crucial for the employer to remember that, even after the policy is

distributed and the employees have been warned, there are limits to what an

employer can do about violations of the policy.

7. Bring Your Own Device Clauses

a. Many employers are permitting, and some encouraging, employees to bring their

own devices to work which are then programmed by the firm’s IT experts, who

create secure work areas for e-mail, employee forms, and other work-related files.

b. Some employers prefer to provide workers with company-owned devices that are

programmed by the IT department to include separate areas for the employee’s

personal use.

c. Whichever technique is adopted, the employer must make certain that the social

media policy makes it clear that these devices are subject to surveillance and that

all work-related data on such devices is company-owned and must, therefore,

remain confidential.

V. Background Information

A. Cross-Cultural Notes

1. In the late nineteenth century, German chancellor Otto von Bismarck instituted the

first government program of social insurance to diffuse the influence of socialist and

communist organizations on industrial workers. The social insurance system was

modeled after the German “benefit societies” of skilled tradesmen and unions, which

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provided compensation to tradesmen and apprentices who became ill or were injured

on the job.

B. Historical Notes

1. The origins of the employment-at-will doctrine date to the 1890’s when factories

claimed they needed to be free to hire and fire at will to operate their businesses

profitably. An 1884 case, Payne v. Western & Atlantic RR, 81 Tenn. 507 (Tenn. 1884),

established this legal doctrine, and subsequent cases broadened its application to all

types of jobs in private industry.

2. Government relief programs were operating in many European countries by the late

nineteenth and early twentieth centuries. Most of the programs were joint plans in

which the government assisted unions in paying out-of-work benefits to union

members. In 1911, the British Parliament established the world’s first compulsory

unemployment insurance plan, based on contributions from employers and employees

combined with state subsidies. By 1930, ten other European nations had adopted

similar programs. A U.S. system of unemployment insurance was instituted with the

Social Security Act of 1935, in response to severe unemployment during the Great

Depression.

3. Britain’s Workmen’s Compensation Act of 1897 was the prototype for the majority of

compensation acts passed in the United States in the early 1900s. It limited

compensation to workers in hazardous jobs and required employers to cover

compensation without the benefit of insurance. The act only covered injuries or

fatalities “arising out of and in the course of employment,” a phrase found in most

U.S. compensation statutes.

4. The Civil Rights Act of 1964, as originally introduced in Congress, did not include

any mention of discrimination on the basis of sex. Sex discrimination was added at

the last minute by conservative southern opponents of the bill who thought that it

would be considered so ridiculous that it would kill the entire bill when Congress

finally voted on it.

C. State Variations

1. Indiana, Missouri, Montana, and Oklahoma have statutes requiring an employer to

provide discharged employees with written statements about their work history,

known as “service letters,” within a prescribed period of time. All of these states

require that the letters contain an explanation for the employee’s discharge.

2. The federal government, along with most states, have laws that make it illegal for

employers to fire or otherwise punish employees for taking time off to serve on juries.

California, Illinois, Nebraska, and Ohio require that employers be given reasonable

notice that a leave for jury duty will be needed. Most states also make it illegal to fire

someone for reporting employers’ violations of law (“whistle blowing”).

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3. In New Jersey, the state’s law against discrimination prohibits bias based on

consideration of age. Eighteen other states have similar antidiscrimination statutes,

with no minimum age.

D. Quotations

1. (T)he success of vicarious liability statutes and workmen’s compensation provisions

in the law suggest that in order to secure accident deterrence we need not penalize

those at fault (or likely to be at fault) in causing injuries. In the case of workmen’s

compensation, employers have shown a remarkable facility for improving safety

conditions—and thereby reducing the number of accidents—when, regardless of

personal culpability, they have been placed in the position of standing to lose in virtue

of increased accident costs.

— Jeffrie Murphy and Jules Coleman, Philosophy of Law (Boulder, CO: Westview Press

1990), p. 151.

VI. Terms

1. Most people agree that getting fired is a consequence of doing something wrong at

work. Other terms, such as dismissal, discharge, layoff, staff cut, and downsize are

euphemisms for firing often used by employers to prevent bad community relations,

anti-company sentiment among employees, and wrongful discharge lawsuits. To refer

to mass firings, some companies have coined such expressions as reorganizational

incentives and activity analysis and review.

2. The EEOC and the United States Supreme Court accepted this nineteenth-century

definition of race in the Civil Rights Law of 1866, Section 1981: “any ethnic

minority.”

VII. Related Cases

1. In Cloutier v. Costco Wholesale Corp., 390 F.3d 126 (1st Cir. 2004), the plaintiff

claimed that her employer, Costco, failed to offer her a reasonable accommodation

after she alerted the employer to a conflict between the company’s no facial jewelry

code and her religious practice as a member of the Church of Body Modification. On

appeal, the court ruled that Costco had no duty to accommodate the plaintiff because

it could not do so without undue hardship and that Costco was, therefore, entitled to a

summary judgment ruling in its favor.

2. Under a church-devised apprenticeship program, members of the Shiloh True Light

Church of Christ, a separatist religious sect near Charlotte, North Carolina, employed

children as young as ages nine and ten in woodworking and masonry. Children laid

bricks and cinderblocks, hauled mortar, operated power saws and forklifts, and

sometimes worked on rooftops and scaffolds. When the church was sued for violating

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child labor laws, it claimed that the labor was part of the children’s religion and there-

fore was protected under the constitutional free exercise of religion clause. In Brock v.

Wendell’s Woodwork, Inc., and Brock v. McGee Brothers Co. 867 F.2d 196 (4th Cir.

1989), the court found that enforcing labor laws to ensure children’s safety overrides

any argument for free exercise of religion.

3. In Hudgens v. Prosper, Inc., 243 P.3d 1275 (Utah 2010), claiming that a former

supervisor subjected him to waterboarding as part of a motivational exercise, the

plaintiff brought claims for assault and battery, intentional infliction of emotional

distress, wrongful termination, and interference with a contractual relationship against

the supervisor and his former employer. The plaintiff allege that after the

waterboarding experience, the supervisor told other employees that they should work

as hard at making sales as the plaintiff had worked at trying to breathe. The

defendant moved for dismissal for a number of reasons including the exclusivity

provisions of the state’s workers’ compensation system. The district court dismissed

the plaintiff’s claims. On appeal, the court ruled that the lower court abused its

discretion in denying the plaintiff leave to amend and erred in dismissing the case.

VIII. Teaching Tips and Additional Resources

1. The Equal Employment Opportunity Commission has a wealth of information,

including information on discrimination by type, available at http://www.eeoc.gov/.

2. Ask students to discuss their thoughts regarding the solvency of the social security

system. An interesting project would be for students to research the expected life

span of Americans when the social security system was instituted as opposed to today.

Additionally, ask students to research borrowings from social security by other

federal agencies. The Internet site for the Social Security Administration containing

detailed information regarding social security is at http://www.socialsecurity.gov/.

3. A fact sheet from the U.S. Department of Labor on the Uniformed Services

Employment and Reemployment Rights Act is available at

http://www.dol.gov/vets/programs/userra/userra_fs.htm.

4. Additional information regarding the Americans with Disabilities Act is available

from the U.S. Department of Justice at http://www.usdoj.gov/crt/ada/adahom1.htm .

5. The U.S. Department of Justice provides extensive information on the Americans

with Disabilities Act at http://www.ada.gov/.

6. The federal Occupational Safety and Health Administration has an Internet site at

http://www.osha.gov/ with extensive information on safety and health topics at

http://www.osha.gov/SLTC/index.html.

7. The U.S. Department of Labor has information regarding wage and hour

requirements at http://www.dol.gov/dol/topic/wages/.

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Chapter 23 - Employment Law

8. The U.S. Department of Labor has a fact sheet on the Worker Adjustment and

Retraining Notification Act at http://www.doleta.gov/programs/factsht/warn.htm.

9. The EEOC has a number of press releases regarding its activities. An article titled

“Potato Packing Companies to Pay $450,000 to Settle EEOC Suit for Sex Harassment

and Retaliation” is available from the EEOC at

http://www.eeoc.gov/eeoc/newsroom/release/10-7-15.cfm.

10. The Social Security Administration provides information regarding benefits for

people with disabilities at https://www.ssa.gov/disability/.

11. Ask four students to volunteer to conduct a panel discussion on the pros and cons of

employment-at-will. Have two students take the position of the employer and two

students take the position of the employee.

12. Explain to students that, absent a written employment contract, the practice of giving

an employer a notice of two weeks or more before resigning is a traditional

professional courtesy and not a legal requirement.

13. Explain to students that, with the erosion of the employment-at-will doctrine, labor

lawyers often recommend putting disclaimer statements on employment application

forms and in employee handbooks.

14. Lead students in a discussion of whether they think the after acquired evidence

defense is fair to employees. Alternatively, you may wish to organize the class into

debate teams to resolve the following question: Is it fair that an employer can defeat a

valid claim for wrongful discharge by finding later evidence that could have been

used to fire the employee?

15. Emphasize to students the importance of documentation in proving a wrongful

discharge claim by an employee. Both employers and employees should keep detailed

records of written and oral statements and actions regarding job performance and the

circumstances leading to a firing. It is especially important that there be witnesses to

the statements. Discuss with students the best possible method of documenting

incidents.

16. Inform students that employers are also required under WARN to give sixty days

notice of staff reduction to the appropriate unit of local government.

17. Have students research averages wage for women and for men. Discuss what

accounts for any disparity.

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Chapter 23 - Employment Law

between men and women in the Social Security system. Students should examine the

ways in which the system discriminates against women who are divorced, widowed,

disabled, or who work at home. Ask students to devise strategies for eliminating these

inequities.

18. Some companies provide family leave benefits in addition to those required under the

FMLA. Have students research various businesses to find out what additional benefits

these businesses offer their employees. For example, some companies allow their

employees some or all of the following: short-term disability plus child care leave;

full leave for a limited number of months; length of disability determined on

individual cases; a percentage paid disability two weeks prior to childbirth for a

specific number of weeks; disability for a limited period at a percentage of the

employee’s salary; unpaid child care leave when disability ends; and job security for a

limited number of months while on leave.

19. Students may think that quotas for hiring exist under affirmative action programs.

However, it is illegal for an employer to specify that he or she is seeking to hire a

member of a particular minority or ethnic group in job advertisements, even for the

purpose of fulfilling conditions of affirmative action programs.

20. The Equal Employment Opportunity Commission (EEOC) Guidelines on

Discrimination Because of Sex provides: Where employment opportunities or

benefits are granted because of an individual’s submission to the employer’s sexual

advances or requests for sexual favors, the employer may be held liable for unlawful

sex discrimination against the other person who was qualified for but denied that

employment opportunity or benefit.

21. Advise students that if they send letters to employers or employees about contentious

legal issues, they should send them as certified mail because the receiver has to sign

for the mail to obtain it. In this way, if necessary, the dates on which the letters were

sent and received can be proved.

22. In some states, but not all, conversations may be recorded without permission if the

person recording is a party to the conversation. Have students research laws

involving tape recording conversations in their states.

23. Make sure students are aware that an employee’s burden to prove age discrimination

includes producing the following evidence: The employee 1) was forty years old or

older; 2) was terminated or demoted; 3) was doing a good enough job to meet the

employer’s legitimate expectations; and 4) was treated less favorably than those

employees under the age of forty.

24. Inform students that in many cases, a victim of discrimination may end up having to

pay little or nothing for litigation.

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Chapter 23 - Employment Law

25. Challenge students to research the standards established by the Americans with

Disabilities Act and compare them with the standards of the Rehabilitation Act of

1973, including the amendments of 1974 and 1978.

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Solution manual

978-0077733735 Chapter 23 Lecture Notes

Business Law with UCC Applications 14th Edition