Chapter 34 - Employment, Immigration, and Labor Law

Employment at will

A common law doctrine under which either party may terminate an employment relationship at any time for any reason, unless a contract specifies otherwise.

• Majority of U.S. workers continue to have the legal status

What are some exceptions to employment-at-will doctrine based on:

• Contract theory

• Tort theory

• Public policy

When may a Implied Employment Contract exist?

Between the employer and employee

What is the key consideration in determining whether an employment manual creates an implied contractual obligation?

The employee’s reasonable expectations

What are an employer’s oral promises regarding discharge policy considered to be a part of?

Implied Contract

Exceptions based on Tort Theory

Abusive discharge procedures may result in a lawsuit for intentional infliction of emotional distress or defamation.

Tort of Theory Fraud

Fraud may be alleged when an employer makes false promises to a prospective employee.

Exceptions Based on Public Policy

The most common exception to the employment-at-will doctrine is made on the basis that the employer’s reason for firing the employee violates a fundamental public policy of the jurisdiction.

Where must public policy e expressed?

The statutory law governing the jurisdiction.

Whistleblowing

An employee’s disclosure to government authorities, upper-level managers, or the media that the employer is engaged in unsafe or illegal activities.

Wrongful discharge

An employer’s termination of an employee’s employment in violation of the law or an employment contract.

What might wrongful discharge lead to?

May result in liability to the former employee

The Davis-Bacon Act

requires contractors and subcontractors working on federal government construction projects to pay “prevailing wages” to their employees.

The Walsh-Healey Act

requires that a minimum wage, as well as overtime pay at 1.5 times regular pay rates, be paid to employees of manufacturers or suppliers entering into contracts with agencies of the federal government.

The Fair Labor Standards Act (F LSA)

extended wage-hour requirements to cover all employers engaged in interstate commerce or in producing goods for interstate commerce.

What else does the FLSA prohibt?

Oppressive child labor.

What are the limits to child labor under the FLSA?

Children under fourteen years of age are restricted on how many hours per day and per week they can work, and they are allowed to do only the following types of work:

• Deliver newspapers

• Work for their parents

• Be employed in entertainment and (with some exceptions) agriculture

Children aged 14 to 15 can work but what conditions can they not work under?

hazardous occupations, and they are also restricted on how many hours per day and per week they can work.

What are the restrictions for persons between the ages of 16 and 18?

Working times and hours are not restricted, but they cannot be employed in hazardous jobs.

Minimum wage

The lowest wage, either by government regulation or by union contract, that an employer may pay an hourly worker.

What do more than half of states set their minimum wage to?

above the federal level

How much is an employee obligated to pay tipped workers?

$2.13 an hour in direct wages—if that amount, plus the tips received, equals at least the federal minimum wage.

What happens when an employee’s tips and direct wages do not equal the federal minimum wage?

the employer must make up the difference.

What happens when service employees are paid the full minimum wage and take no tip credit

employees who are not tipped can participate in a tip pool.

What must an employer when they collect tips?

create a mandatory tip pool and must fully distribute the tips within the pay period.

Can the employer keep employee tips?

No. Not under any circumstance.

Are managers and supervisors entitled to employee tips?

They may not, including through tip pools.

Under the FLSA, what is an employee who works more than forty hours per week entitled to?

must be paid no less than 1.5 times their regular pay for hours worked over forty.

When do FLSA overtime provisions apply?

only after an employee has worked more than forty hours per week.

What does not qualify for overtime?

Working four ten hour days.

Who is exempt from the FLSA’s overtime provisions?

• Executive

• Administrative, and Professional employees

• Outside salespersons

• Those who create computer code

Are workers who make make a specified amount (salaried) eligible for overtime pay?

No. They are not eligible for overtime pay.

What happens when an employer voluntarily pays overtime to ineligible employees?

The employer cannot waive or reduce the overtime requirement of the FLSA.

The Worker Adjustment and Retraining Notification (WARN) Act

• applies to employers with at least one hundred full-time employees

• The act requires these employers to provide sixty days’ notice before implementing:

  • A mass layoff: defined as a layoff of at least one-third of the fulltime employees at a particular job site

  • OR −closing a plant that employs more than fifty full-time workers.

What is the WARN Act intended to do?

• Give workers advance notice so they can start looking for new jobs while still employed

• Alert state agencies so they can provide training and other resources for displaced workers

What happens when an employer violates the WARN Act?

They can be fined up to $500 for each day of the violation and employees can recover back pay for each day of the violation (up to 60 days), plus reasonable attorneys’ fees.

The Family and Medical Leave Act (FMLA)

allows employees to take time off work for family or medical reasons or in certain situations that arise from military service.

When does the FMLA not apply?

When any state or local law provides more generous protection.

How many employees must an employer have to provide unpaid leave for specified reasons?

50 or more.

Who does the FMLA expressly cover?

Private and public (government) employees who have worked for their employers for at least a year.

What are some reasons for an eligible employee to take up to 12 weeks leave?

• To care for a newborn baby within one year of birth

• To care for an adopted or foster child within one year of the time the child is placed with the employee

• To care for the employee’s spouse, child, or parent who has a serious health condition

• If the employee suffers from a serious health condition and is unable to perform the essential functions of their job

• For any qualifying exigency (nonmedical emergency) arising out of the fact that the employee’s spouse, child, or parent is a covered military member on active duty

What happens when an employee take FMLA leave?

• the employer must continue the worker’s health-care coverage on the same terms as if the employee had continued to work.

• Most employees must be restored to their original position or to a comparable position (with nearly equivalent pay and benefits, for instance).

What is an exception to reinstating an employee under FMLA?

allows the employer to avoid reinstating a key employee— defined as an employee whose pay falls within the top 10 percent of the firm’s workforce.

What are some remedies under FMLA?

1. Damages to compensate the employee for lost wages and benefits, denied compensation, and actual monetary losses (such as the cost of providing care for a family member)

   1. Compensatory damages are available up to an amount equivalent to the employee’s wages for twelve weeks.

2. Job reinstatement

3. Promotion, if a promotion has been denied

   1. A successful plaintiff is also entitled to court costs and attorneys’ fees.

   2. If the plaintiff shows that the employer acted in bad faith, the plaintiff can receive two times the amount of damages awarded by a judge or jury.

   3. Supervisors can also be held personally liable, as employers, for violations of the act.

How does the government protect employees’ income?

• Social Security

• Medicare

• Unemployment insurance

• The regulation of pensions and health insurance plans.

The Occupational Safety and Health Act

• Imposes on employers a general duty to keep the workplace safe.

• OSHA has establishes specific safety standards that employers must follow, depending on the industry.

What does the Occupational Safety and Health Act require employers to do?

• Post certain notices in the workplace

• Keep occupational injury and illness records for each employee

  • Applies to employers with eleven or more employees.

  • Each record must be made available for inspection when requested by an OSHA compliance officer

When must an employer notify OSHA when an employee dies?

Within eight hours.

When must an employer notify OSHA when an employee faces hospitalization, amputation, or loss of an eye?

Within twenty-four hours.

What happens after an incident?

A complete inspection of the premises is mandatory.

When can an employer not discharge an employee under OSHA?

• Files a complaint

• In good faith, refuses to work in a high-risk area if bodily harm or death might result

Workers’ compensation law

A state statute establishing an administrative procedure for compensating workers for injuries that arise out of, or in the course of, their employment, regardless of fault.

Instead of suing the employer, what can an injured worker do?

File a claim with the state agency or board that administers local workers’ compensation claims.

What type of employees are excluded from State Workers’ Compensation Statute?

• Domestic workers

• Agricultural workers

• Temporary employees

• Employees of common carriers (companies that provide transportation services to the public)

Requirements for Receiving Workers’ Compensation

• The existence of an employment relationship

• An accidental injury that occurred on the job or in the course of employment, regardless of fault.

What must an employee do to receive workers’ compensation?

• Notify their employer promptly (usually within thirty days of the accident)

• File a workers’ compensation claim within a certain period (sixty days to two years) from the time the injury is first noticed, rather than from the time of the accident

What happens if an employee accepts workers’ compensation benefits?

they may not sue for injuries caused by the employer’s negligence.

No Fault

Prevents employers from avoiding liability by using defenses such as contributory negligence or assumption of risk.

Federal and state governments participate in insurance programs designed to protect employees and their families from the financial impact of:

• Retirement

• Disability

• Death

• Hospitalization

• Unemployment

The Social Security Act (or O A S D I)

provides for retirement, survivors’, and disability insurance

What are retired workers covered by Social Security entitled to?

monthly payments from the Social Security Administration, which administers the Social Security Act.

Medicare

Medicare is a federal government health-insurance program administered by the Social Security Administration.

Who does Medicare apply to?

• People sixty-five years of age and older

• Some under age sixty-five who are disabled

Federal Insurance Contributions Act (FICA)

both employers and employees contribute to Social Security and Medicare, although the contributions are determined differently

What does an employer do with FICA contributions?

withholds the employee’s contributions from the employee’s wages and ordinarily matches the contributions.

Employee Retirement Income Security Act (E R I S A)

U.S. Department of Labor to enforce its provisions governing employers that have private pension funds for their employees.

What does E.R.I.S.A. not require an employer to do?

does not require an employer to establish a pension plan, but when a plan exists E R I S A provides standards for its management.

Vesting

employee’s legal right to receive pension benefits when they stop working.

When do employee rights to employer contributions vest?

after five years of employment.

Unemployment Insurance

The Federal Unemployment Tax Act (FUTA) created a state-administered system that provides compensation to eligible individuals who have lost their jobs.

What must an employee do to prove that they are eligible for unemployment compensation?

a worker must be willing and able to work.

When is a worker ineligible for unemployment compensation?

Workers who have been fired for misconduct or who have voluntarily left their jobs are not eligible for benefits.

The Consolidated Omnibus Budget Reconciliation Act (COBRA)

enables employees to continue, for a limited time, their health-care coverage after they are no longer eligible for group health-insurance plans.

Who pas for premiums under COBRA?

The employee

What doe COBRA prohibit an employer from doing?

eliminating a worker’s medical, vision, or dental insurance when:

• The worker’s employment is terminated voluntarily or involuntarily (only workers fired for gross misconduct are excluded from protection).

• A reduction in the worker’s hours would affect coverage.

How many dats does a worker have to decide whether to continue with the employer/s group insurance plan?

Sixty Days

What happens if a worker chooses to continue coverage?

The employer is obligated to keep the policy active for up to eighteen months (twenty-nine months if the worker is disabled).

• The coverage must be the same as that provided to the worker (and their family members) prior to the termination or reduction of work.

What happens when an employer violates COBRA?

substantial penalties, including a tax of up to 10 percent of the annual cost of the group plan or $500,000, whichever is less.

The Health Insurance Portability and Accountability Act (HIPAA)

restricts the manner in which employers collect, use, and disclose the health information of employees and their families.

What does HIPPA ensure?

To ensure that employees’ health information is not disclosed to unauthorized parties, employers must designate privacy officials, distribute privacy notices, and train employees.

What happens when HIPPA regulations are violated?

Failure to comply with the regulations can result in civil penalties of up to $100 per person per violation (with a cap of $25,000 per year).

• Employers are also subject to criminal prosecution for certain types of HIPAA violations.

• An employer can face up to $250,000 in criminal fines and imprisonment for up to ten years if convicted.

The Affordable Care Act

requires most employers with fifty or more full-time employees to offer health-insurance benefits.

What must businesses do under the Affordable Care Act?

Under the act, any business offering health benefits to its employees (even if not legally required to do so) may be eligible for tax credits of up to 35 percent to offset the costs.

What happens when an employer fails to provide health benefits as required under the statute?

can be fined up to $2,000 for each employee after the first thirty people.

When can an employer be assessed a penalty for their healthcare plan costs?

When it costs an employee more than 9.5% of their income.

How do employers electronically monitor their employees?

• Review employees’ e-mail, social media posts, and other internet messages

• Make video recordings of employees at work

• Record employees’ telephone conversations

• Listen to employees’ voice mail

The Electronic Communications Privacy Act

prohibits employers from intercepting personal electronic communications unless made on devices and systems furnished by the employer.

What leeway do employers have when monitoring their employees in the workplace?

• Private employers generally are free to use filtering software to block access to certain websites.

• The First Amendment’s protection of free speech prevents only government employers from restraining speech by blocking websites.

Reasonable Expectation of Privacy

When determining whether an employer should be held liable for violating an employee’s privacy rights, the courts generally weigh the employer’s interests against the employee’s reasonable expectation of privacy.

What if employees have been informed that their communications are being monitored?

they cannot reasonably expect those interactions to be private.

What happens when employees are not informed that certain communications are being monitored?

the employer may be held liable for invading their privacy.

What exception do courts typically hold regarding reasonable expectation of privacy?

when using a system (such as an e-mail system) provided by the employer.

the Employee Polygraph Protection Act

• Prohibits employers from requiring, suggesting, or requesting employees or job applicants to take lie-detector tests

  • Restricts employers’ ability to use or ask about the result of any lie-detector test

  • Restricts employers’ ability to take any negative employment action based on the results of a lie-detector test

What are some exemptions to the Employee Polygraph Protection Act?

• Federal, state, and local government employers

• Certain security service firms

• Companies that manufacture and distribute controlled substances

• While investigating losses attributable to theft, including embezzlement and the theft of trade secrets

What amendment constrains government employers in drug testing.

the Fourth Amendment to the U.S. Constitution, which prohibits unreasonable searches and seizures.

When is drug testing of public employees allowed?

by statute for transportation workers

When do courts uphold drug testing of certain employees?

when drug use in a particular job may threaten public safety

When can courts find that drug testing does not violate the Fourth Amendment?

When there is a reasonable basis for suspecting public employees of drug use