EXAM 2 MGT 330

Types of contracts

Word Play: 🦄 Big Unicorns Eat Ice. Quiet Elephants Visit Vegas Underground.

1. Bilateral: Both sides exchange promises.

2. Unilateral: One side promises something in exchange for an action.

3. Express: Agreement made through spoken or written words.

4. Implied-in-Fact: Actions show an agreement without directly saying it.

5. Quasi-Contract: Court imposes an obligation to prevent unfair benefit; not a real contract.

6. Executory: At least one side still has something promised to do.

7. Void: Never legally valid.

8. Voidable: Valid, but one protected party can cancel.

9. Unenforceable: Agreement may be valid, but a court won't enforce it.

Sources of contract law

UCC Article 2 governs sales of movable goods. Common law generally governs services and real estate. UCC Article 2A governs leases of goods.

click on agreements

A click-on (clickwrap) agreement forms when a person is shown terms and indicates agreement by clicking something like “I agree.” The key is clear assent to the terms.

Elements of a contract

A valid contract generally requires an agreement (offer and acceptance), consideration, parties with legal capacity, and a lawful purpose. Some contracts also require a particular form, such as writing.

agreement

Agreement means the parties objectively agree to the same deal through offer and acceptance. Offeror makes the offer; offeree receives it. An offer needs intent to be bound, reasonably definite terms, and communication. Acceptance must be a clear agreement to the offer before it ends; changing the terms is generally a counteroffer under common law.

mailbox rule

Under the traditional mailbox rule, an acceptance sent by an authorized method is effective when properly dispatched, not when received, unless the offer says otherwise. Rejections and revocations generally take effect when received.

terminations of offers

An offer can end by revocation (offeror withdraws it), rejection (offeree says no), counteroffer (offeree proposes different terms), lapse of time, death or incapacity, or destruction/illegality of the subject. A valid option contract or UCC firm offer can restrict revocation. A counteroffer is not limited to nonmerchants or businesses.

consideration

Consideration is a bargained-for exchange of something legally valuable, such as a promise, act, or giving up a legal right. Doing only an existing legal duty usually is not new consideration. A promise based solely on something already done is past consideration and usually insufficient.

contractual capacity

Contractual capacity means legal ability to enter a binding contract. Minors, people lacking mental capacity, or people so intoxicated they cannot understand a transaction may have the right to avoid a contract. Their contracts are not automatically all void.

legality

A contract must have a lawful purpose. Agreements requiring illegal conduct or violating public policy generally cannot be enforced.

promissory estoppel

A legal doctrine that makes a promise enforceable without consideration when the promisor should reasonably expect reliance, the promisee actually and reasonably relies on it to their detriment, and enforcement is necessary to avoid injustice.

Example: An employer promises Sarah a job, so she quits her current job and relocates. The employer withdraws the offer. Sarah may recover damages because she reasonably relied on the promise to her detriment.

contracting with a minor

In North Carolina, the usual age of majority is 18. A minor's contract is generally voidable by the minor (disaffirmance), with exceptions such as necessities and certain statutory rules. An adult usually cannot cancel solely because the other party is a minor.

shrink wrap agreements

Shrink-wrap agreements have terms inside or on product packaging, often software. Acceptance may be claimed when the buyer keeps or uses the product after a fair opportunity to review and reject the terms; enforceability depends on the circumstances.

firm offer

Under UCC Article 2, a merchant's signed written promise to hold an offer to buy or sell goods open cannot be revoked for the stated time, or a reasonable time if unstated, up to 3 months without consideration. It does not have to be written in English.

statute of frauds

The statute of frauds requires certain agreements to be evidenced by a signed writing to be enforceable. Common examples include land sales, agreements impossible to perform within one year, and generally sales of goods priced at $500 or more (subject to exceptions). It is unrelated to the tort of fraud.

The word “frauds” is there because the law was originally created to prevent people from lying about contracts.

option

An option contract is an agreement, generally supported by consideration, to keep an offer open for a specified time. During that time, the offeror cannot revoke it.

parole evidence rule

Prevents prior or simultaneous agreements from contradicting a final written contract.

• Prior Agreements: Earlier oral or written promises generally cannot contradict the final contract.

• Final Written Contract: The written agreement controls.

• Exceptions: Evidence may be allowed for fraud, ambiguity, or certain other reasons.

• Later Changes: Agreements made after signing are not barred by this rule.

Example: A seller verbally promises a 2-year warranty, but the final written contract specifies 1 year. The buyer generally cannot use the earlier promise to contradict the contract.

puffery

Puffery means obvious sales exaggeration or opinion, such as “the best product ever,” rather than a specific factual promise. It generally is not an enforceable warranty.

Undue influence

Undue Influence: Using a position of trust or power to pressure someone into an agreement they wouldn't freely choose.

Example: A caregiver pressures an elderly patient into signing over their house by exploiting the patient's trust and dependence on them.

contract defenses

Contract defenses are reasons a contract may not be enforced. Lack of genuine voluntary consent can result from fraud, duress, undue influence, or certain mistakes. A form defense occurs when a required form, such as a signed writing, is missing.

specific performance

Specific performance is a court order to carry out the promised contractual performance instead of merely paying money. Usually used when money cannot adequately replace a unique item, especially land; ordinarily not ordered for personal services.

5 elements of fraud

5 Elements of Fraud — “I Miss My Jelly Donuts” (IMMJD)

• I – Intent to induce reliance: Intended to make someone act on the lie.

• M – Material Misrepresentation: False statement about an important fact.

• M – Mens Rea (Scienter): Knew it was false or recklessly disregarded the truth.

• J – Justifiable Reliance: Victim reasonably believed and acted on the lie.

• D – Damages: Victim suffered harm because of it.

mutual vs unilateral mistake

Mutual mistake means BOTH parties share the same mistaken belief about an important fact; the contract may be voidable. Unilateral mistake means only ONE party is mistaken; relief is less common. A bad guess about future value generally is not enough.

innocent misrepresentation

When someone gives false information without knowing it's false and without trying to trick anyone.

Even though they didn't mean to lie, the false information may still allow the other person to cancel a contract.

Example:

Sarah sells her car to John.

• Sarah tells John the car has never been in an accident.

• Sarah genuinely believes this is true.

• John buys the car based on that information.

• Later, John discovers the car was in a major accident before Sarah owned it.

• Result: Sarah made an innocent misrepresentation because she gave incorrect information without knowing it was false. John may be able to cancel the contract.

duress

Duress means wrongful threats or pressure leave a person without a reasonable free choice about entering a contract. The pressured party can generally avoid the contract; ordinary persuasion or financial need alone is not necessarily duress.

third party rights

Rules governing when contract rights or duties transfer to someone else, or when a third party can enforce a contract.

• Assignment: Transfers a contractual RIGHT to another person (often the right to receive payment).

• Delegation: Transfers a contractual DUTY to another person (original party generally remains liable).

• Intended Beneficiary: Third party the contract is meant to benefit; can enforce the contract.

• Incidental Beneficiary: Benefits accidentally or indirectly; cannot enforce the contract.

Examples:

• Assignment: John transfers his right to collect $500 to Sarah.

• Delegation: John hires someone else to paint a house he agreed to paint.

• Intended: Mom buys life insurance naming her daughter as beneficiary.

• Incidental: A nearby restaurant earns more money because a new office opens.

contract performance and discharge

A contract can be discharged by complete or legally sufficient performance, agreement of the parties, or operation of law. True impossibility, impracticability, or frustration of purpose may excuse performance in limited circumstances. A foreseeable risk does not automatically bar every excuse, but an assumed or allocated risk often does.

damages for breach of contract

Damages for breach of contract: Money someone may have to pay for breaking a contract.

“Cool Cats Play Nice, Love Pizza, Man!”

• Compensatory damages: Pay for what the other person directly lost because the contract was broken.

• Consequential damages: Pay for additional losses caused by the broken contract that could have been reasonably expected.

• Punitive damages: Extra money meant to punish someone. Usually not allowed for just breaking a contract.

• Nominal damages: A small amount awarded when someone breaks a contract but no actual loss can be proven.

• Liquidated Damages: A specific amount of money agreed upon beforehand in a contract that someone must pay if they break it. EX: Your contract says you must pay $500 if you cancel. You cancel the wedding. You owe $500 because that amount was agreed upon beforehand.

• Penalty: An unreasonable amount meant to punish someone for breaking a contract. Usually not enforceable.

• Duty to mitigate: If someone breaks a contract with you, you must make reasonable efforts to keep your losses from getting worse.

force majeure

Force Majeure: A contract clause that allows someone to delay or avoid fulfilling a contract because of extraordinary events beyond their control.

• Examples: Hurricanes, earthquakes, wars, or other disasters.

• Protection: May excuse delays or failure to fulfill the contract.

• Important: Only applies to events covered by the contract's wording.

Example: A hurricane destroys a wedding venue, preventing the wedding from happening. A force majeure clause may excuse the venue from fulfilling its contract.

restitution

Restitution — “Give Back What You Got”

Returning money, property, or the value of a benefit someone unfairly received to prevent unjust enrichment (unfairly benefiting at someone else's expense).

Example: You pay a contractor $500, but they never perform the work. Restitution means returning your $500.

Remember:

• Restitution: Give back what was received.

• (tell difference) Rescission = Cancel the contract. Treat it as if the agreement never happened.

• Expectation damages: Pay for what someone would have gained if the contract was fulfilled.

rescission

Rescission: Legally canceling a contract and trying to return both parties to how they were before the agreement.

• Fraud: Someone lied to get the agreement.

• Mistake: A qualifying error was made.

• Duress: Someone was forced or threatened into agreeing.

• Result: Both sides generally return what they received.

Example: You buy a camera for $1,000 after the seller lies about its condition. The contract is rescinded → You return the camera, and the seller refunds your $1,000.

Exam word association:

Rescission → Reset the contract.

3 types of warranties

Express warranty: a seller's factual promise, description, or sample that becomes part of the bargain.

Implied warranty of merchantability: goods sold by a merchant of that kind are reasonably fit for their ordinary use.

Implied warranty of fitness for a particular purpose: seller knows the buyer's SPECIAL purpose and knows the buyer is relying on the seller's expertise to select suitable goods. Example: A customer tells a shoe salesperson they need shoes for mountain climbing. The salesperson recommends a pair, but the shoes are unsuitable for climbing.

statute of repose

A law that sets an absolute deadline for filing certain lawsuits, even if you don't discover the injury or problem until later.

Example:

John buys a lawnmower in North Carolina in 2020.

• 2020: John buys the lawnmower.

• 2032: The 12-year statute of repose expires.

• 2034: The lawnmower malfunctions and injures John.

• Result: John generally cannot sue for a product defect because the 12-year deadline has already passed.

Even though John just got injured, the law generally prevents his product liability claim.

Important North Carolina Rule:

For most product liability claims, North Carolina has a 12-year statute of repose, starting from the product's initial purchase for use or consumption.

strict product liability

A company can be held responsible if its defective product injures someone, even if the company wasn't careless.

Example:

Sarah buys a brand-new blender.

• The blender has a manufacturing defect.

• While Sarah uses it normally, the blade breaks and injures her hand.

• Even if the manufacturer followed safety procedures, it could still be held responsible under strict product liability.

• Sarah generally needs to prove the product was defective and the defect caused her injury, not that the company was negligent.

Important North Carolina Difference:

North Carolina does NOT recognize strict liability in product liability cases. Instead, injured consumers generally must pursue claims based on negligence or breach of warranty.

Magnuson Moss Act

Magnuson-Moss Warranty Act (1975): Federal law protecting consumers by regulating written warranties on products.

• Written Warranties: Sellers aren't required to offer them, but must follow federal rules if they do.

• Full Warranty: Provides stronger consumer protections, including free repairs or replacements under qualifying conditions.

• Limited Warranty: Covers only certain repairs, parts, or conditions.

• Key Rule: Warranties must be clear, truthful, and properly disclosed.

Example: A company advertises a “full warranty” on a defective refrigerator but refuses to repair it for free. This may violate the Act.

Magnuson = Manufacturer's Warranty

Moss = Must disclose

caveat emptor

Caveat emptor means “buyer beware.” An “as is” sale often places risk of defects on the buyer and can exclude some implied warranties, but does not automatically excuse fraud or override every consumer protection.

UCC Article 2 Sale of Goods

UCC Article 2 applies to sales of movable tangible goods. A sale transfers ownership (title) for a price. A merchant regularly deals in the goods or holds themselves out as having relevant commercial knowledge or skill; a farmer CAN qualify as a merchant in the proper circumstances.

lease/lessor/lessee

Lease: agreement giving temporary possession and use of goods for payment without transferring ownership.

Lessor: owner or party granting the right to use goods.

Lessee: person receiving the temporary right to possess and use them.

negligence

Negligence requires a duty of reasonable care, breach of that duty, actual causation (but-for cause), proximate causation (legally close and generally foreseeable harm), and actual damages. In product cases, negligent design, manufacture, or inadequate warnings can be claims. Direct contract (privity) is not always required. Defenses depend on state law, including contributory negligence, assumption of risk, or an independent superseding cause.

covenant not to compete

Covenant Not to Compete (Noncompete Agreement)

A contract that prevents someone from working for or starting a competing business after leaving a job or selling a business.

Restrictions usually involve:

• Time: How long the restriction lasts.

• Location: Where they cannot compete.

• Activity: What type of competing work is restricted.

Important: Must be reasonable and legally allowed to be enforceable.

Example: A barber agrees not to open a competing barbershop within 5 miles for 1 year after quitting.

detour and frolic test

Detour: a small personal deviation while still generally doing the employer's business, so employer may remain liable. Frolic: a major departure for purely personal purposes, so employer generally is not liable for torts during it.

employee vs independent contractor

The key difference is who controls HOW the work is done.

• Employee: Employer controls how, when, and where work is performed.

• Independent Contractor: Worker generally controls how the job gets done.

• Key Rule: The actual working relationship matters, not the job title.

Example:

• Employee: A restaurant chef follows the manager's schedule and instructions.

• Independent Contractor: A plumber is hired to fix a sink but chooses their own tools and methods.

agency relationship

Agency exists when a principal authorizes an agent to act on the principal's behalf and subject to the principal's control. The agent owes fiduciary duties, including loyalty, to the principal.

disclosed contract liability of a principal/agent

Disclosed Principal: When the third party knows the agent is representing someone AND knows exactly who that person or business is.

EX: Bill buys a camera for your photography business and tells the store he's buying it for Kobi Cole Photography. Your business is responsible for paying, not Bill.

Why does knowing the identity matter?

Because the store knows who it's actually making a deal with and who it can hold responsible.

partially disclosed contract liability of a principal/agent

Partially disclosed (unidentified) principal: third party knows the agent represents SOMEONE but does not know that principal's identity. The principal and usually the agent can be liable on an authorized contract.

undisclosed contract liability of a principal/agent

When an agent makes a contract without revealing they're acting for someone else.

• Undisclosed Principal: The third party doesn't know a principal exists.

• Agent: Appears to be acting on their own behalf.

• Liability: Both the agent and principal can generally be held liable for an authorized contract.

• Key Rule: Keeping the principal secret does not eliminate liability.

Example: Sarah buys supplies for her boss without telling the seller. If payment isn't made, the seller can generally hold both Sarah and her boss liable.

employment at will

Employment at will means an employer or employee generally can end employment at any time, with or without a stated reason. Exceptions include discrimination, retaliation, unlawful reasons, public policy, and enforceable contractual protections.

negligent retention

Negligent retention is keeping an employee after the employer knew or should have known the employee posed an unreasonable danger, and the employee later causes a related injury. Key difference from negligent hiring: the warning signs arise or become known AFTER hiring.

negligent hiring

Negligent Hiring: Employer knew or should have known the person was dangerous BEFORE hiring them.

Negligent Retention: Employer knew or should have known the employee was dangerous but KEPT them employed.

respondeat superior

Respondeat superior means “let the master answer.” An employer can be vicariously liable for an employee's wrongful act committed within the scope of employment, even if the employer was not personally negligent. Usually does not apply to an independent contractor's acts.

3 types of principal/agent authority

The ways an agent can gain authority to act on behalf of a principal.

• Express Authority: Principal directly tells the agent what they can do.

• Implied Authority: Agent has authority to do what's reasonably necessary to carry out their duties.

• Apparent Authority: Principal makes a third party reasonably believe the agent has authority, even if they don't.

Examples:

• Express: Boss tells employee to order supplies.

• Implied: Employee buys shipping boxes to fulfill orders.

• Apparent: Boss introduces an employee as a manager, so a customer reasonably believes they can make deals.

Agency by Ratification

When someone acts without permission, but the person in charge later approves what they did, making the action legally authorized.

Example:

Sarah owns a clothing store, and John is her employee.

• John orders $5,000 worth of clothing from a supplier without Sarah's permission.

• Sarah finds out about the purchase.

• Instead of rejecting the order, Sarah approves it and agrees to pay.

• Result: Sarah has ratified John's action, making the purchase binding on her business.

workers compensation

Provides benefits to employees injured or made sick because of their job.

• No-Fault: Employees don't need to prove employer negligence.

• Benefits: Covers medical expenses and part of lost wages.

• NC Rule: Employers with 3+ employees generally must provide coverage.

• Trade-Off: Employees generally cannot sue their employer for ordinary negligence involving covered injuries.

Example: A warehouse worker injures their back lifting boxes. Workers' comp covers medical bills and part of lost wages, even if the employer wasn't at fault.

duties of agent to principal

An agent owes the principal performance with reasonable care, notification of relevant information, loyalty (avoid conflicts and secret profits), obedience to lawful instructions, and accounting for money/property handled.

duties of principal to agent

A principal generally owes the agent agreed compensation, reimbursement of authorized expenses, cooperation, and duties of care or safe working conditions as applicable.

principals liabilities to third parties (Authorities)

🦅 Memory Trick: “Eagles Invite Angry Rhinos!” (E-I-A-R)

Principal’s Liability to Third Parties: A principal can be legally responsible for agreements their agent makes with others through. Third party = Outsider dealing with the agent:

• Express authority: Principal directly gives permission.

• Implied authority: Permission is reasonably necessary to perform the agent's job. EX: You tell your employee, “Go make pizzas.” They use the restaurant's cheese without asking.

• Apparent authority: Principal makes others reasonably believe the agent has permission.

• Ratification: Principal approves the agent's actions afterward.

Agent’s Liability: The agent may also be personally responsible depending on whether the third party knew the principal's identity. The less the third party knows about the principal, the more likely the agent is personally liable.

• E → Express = Told yes

• I → Implied = Part of the job

• A → Apparent = Looks allowed

• R → Ratification = Approved later

how are agency relationships terminated?

Agency may end by agreement, either party's termination, expiration, task completion, or an agreed event. Operation of law may end it through death, loss of capacity, or certain legal impossibility. Third parties may need notice so apparent authority does not continue.

closed shop

Closed shop: workplace that requires someone to already belong to a union BEFORE being hired. Closed shops were outlawed by the federal Taft–Hartley Act of 1947.

union shop

A workplace where employees can be hired without belonging to a union but must meet union membership or fee requirements afterward, where legally allowed.

Example:

John gets hired at a factory that has a union shop agreement.

• John doesn't need to be in the union to get hired.

• After being hired, he must meet the required union obligations to keep his job.

• In a right-to-work state like North Carolina, employees cannot be forced to join or pay a union as a condition of employment.

Key things to remember for exams:

• Union shop = Union requirement AFTER hiring

• Closed shop = Union membership required BEFORE hiring (illegal under federal labor law)

• Right-to-work state = Cannot require union membership or dues to keep a job

right to work

Right-to-work laws mean employees cannot be required to join or financially support a union as a condition of getting or keeping a job. This does not mean employers cannot fire workers at will, and does not prevent workers from voluntarily joining unions.

collective bargaining agreement

A collective bargaining agreement (CBA) is a negotiated contract between an employer and a union representing a bargaining unit, setting wages, hours, benefits, and other working conditions. Both sides generally must bargain in good faith, but neither must agree to every demand.

employee polygraph protection act

The Employee Polygraph Protection Act generally bans most private employers from requiring, requesting, or using lie detector tests for employment. Limited exceptions apply, including certain security-related jobs and specific theft investigations.

FMLA

FMLA (Family and Medical Leave Act): Allows eligible employees to take unpaid, job-protected leave for family or serious medical needs.

• 12 weeks: Maximum leave in a 12-month period.

• 26 weeks: Maximum for qualifying military caregiver leave.

• Unpaid: Employer generally doesn't have to pay during leave.

Eligibility requirements:

• 12 months: Must have worked for the employer at least 12 months.

• 1,250 hours: Must have worked this many hours in the past 12 months.

• 50 employees: Employer generally must have 50+ employees, and the employee must work at a location with 50+ employees within 75 miles.

I-9 form

Form I-9 verifies a new hire's identity and authorization to work in the US. Employee completes Section 1 by the first day of employment, and employer generally completes document review/Section 2 within 3 business days after employment begins.

ICE

ICE stands for Immigration and Customs Enforcement, a federal agency enforcing immigration-related laws and investigating worksite compliance. Do not confuse ICE with the employer's Form I-9 duties or USCIS.

NLRB

NLRB (National Labor Relations Board) is the federal agency that conducts union representation elections and investigates or remedies unfair labor practices under the NLRA.

NLRA

NLRA (National Labor Relations Act / Wagner Act): Protects employees' rights to form unions, negotiate as a group, and work together to improve working conditions. Makes it illegal for employers to interfere, control unions, punish union activity, retaliate against NLRB (National Labor Relations Board) participants, or refuse to negotiate in good faith.

Exam association: NLRA = Protects union and group worker rights.

certified unions

A certified union is officially recognized by the NLRB as the exclusive bargaining representative of the employees in a defined bargaining unit, usually after winning a valid election.

steps in union elections

Typically at least 30% of workers in a proposed bargaining unit sign support cards to request an NLRB election. The union generally wins if it gets a majority of valid votes CAST, not necessarily a majority of all employees. The NLRB then certifies the union.

bargaining units

Bargaining unit is simply the group of employees covered by the same union representation. It can include different job types, not necessarily just one.

• Not a union: It's the group of workers the union represents.

• Union's role: Negotiates on behalf of the entire group.

• Important: Once the union is officially certified, it represents everyone in the unit, even those who voted against it.

Example: A factory has 100 factory specific workers in a bargaining unit. Even if 40 voted against the union, the certified union still represents all 100.

WARN

WARN (Worker Adjustment and Retraining Notification Act) generally requires covered employers with 100 or more employees, under statutory counting rules, to give 60 days' advance notice of qualifying plant closings or mass layoffs. Not every layoff triggers WARN.

fair labor standards act

FLSA (Fair Labor Standards Act) sets federal minimum wage, overtime pay for covered nonexempt workers (generally over 40 hours in a workweek), recordkeeping, and child labor standards.

OSHA

OSHA means Occupational Safety and Health Administration, the federal agency that enforces workplace safety and health requirements through standards, inspections, and penalties.

general duty clause

A law requiring employers to protect workers from known, serious workplace hazards, even if OSHA doesn't have a specific safety rule for that hazard.

income security

Programs that help people maintain financial stability and access to benefits, especially during retirement, disability, or after the death of a family member.

Example:

John works at a company for 30 years and decides to retire.

• Social Security: John receives monthly retirement payments based on his work history.

• Medicare: John, age 67, receives health insurance coverage through Medicare.

• Private Retirement Plan: John also receives retirement income from his employer's pension or 401(k), if available.

• Result: These programs help John pay his bills and maintain financial security after he stops working.

unemployment insurance

Unemployment insurance provides temporary payments to eligible people who lose work through no fault of their own and meet state requirements. Employer payroll taxes generally fund it. Quitting without good cause or discharge for misconduct can disqualify someone, depending on state rules.

COBRA

COBRA (Consolidated Omnibus Budget Reconciliation Act) lets qualified people temporarily CONTINUE an employer's group health coverage after certain events such as job loss or reduced hours. Coverage after job loss is generally available up to 18 months, often with the person paying the full premium plus an administrative fee. It does not make the employer keep paying for coverage.

employee privacy

Employee Privacy: Employees have some privacy rights at work, but employers may monitor or search for legitimate business reasons.

• Public employees (government jobs): May have constitutional privacy protections.

• Private employees (businesses): Privacy rights mainly come from laws, employment contracts, and privacy-related legal protections.

• Reasonable expectation of privacy: Whether an employee should realistically expect something to remain private.

• Employer's rights: Employers may monitor or search when justified, within legal limits.

electronic communications privacy act

The Electronic Communications Privacy Act generally limits unauthorized interception of electronic communications and access to certain stored communications, subject to exceptions such as consent and some ordinary-course employer monitoring.

genetic information nondiscrimination act

GINA (Genetic Information Nondiscrimination Act) generally prohibits covered employers from using genetic information in employment decisions and health plans/insurers from using genetic information for certain coverage or premium decisions. Genetic information includes family medical history.

immigration reform and control act 1986

IRCA Immigration Reform and Control Act (1986): A law that makes it illegal for employers to knowingly hire or keep workers who are not legally allowed to work in the U.S. Employers must verify workers' eligibility using Form I-9.

immigration act of 1990

A U.S. law that expanded opportunities for people to legally immigrate to the United States, especially through employment, and changed visa categories and immigration limits.

Example:

Maria is a skilled engineer living in another country.

• A U.S. technology company wants to hire her.

• The Immigration Act of 1990 expanded employment-based immigration opportunities.

• Maria may qualify for an employment-based visa if she meets the requirements.

• Result: The law helped create more pathways for qualified foreign workers to live and work legally in the United States.

Key things to remember for exams

• 1990 = Expanded legal immigration opportunities.

• Employment-based visas = More pathways for qualified foreign workers.

• Family-based immigration = Updated categories and limits.

• Diversity Visa Program = Created a pathway for immigrants from countries with historically low U.S. immigration rates.

• H-1B visas = Established major rules for specialty occupation workers.

norris-laguardia act

1932 Federal law protecting workers' rights to engage in peaceful union activities.

• Limits Injunctions: Restricts federal courts from stopping lawful labor activities.

• Protects Unions: Helps protect peaceful strikes, picketing, and organizing.

• Key Rule: Employers generally cannot use federal court injunctions to shut down lawful union activities.

Example: Workers peacefully strike for better wages. Their employer generally cannot obtain a federal court injunction simply to stop the strike.

taft-hartley act

The Taft–Hartley Act (Labor Management Relations Act of 1947) amended the NLRA, restricted certain union activities, outlawed closed shops, allowed state right-to-work laws, and permits federal intervention in certain strikes threatening national health or safety.

landrum-griffin act

The Landrum–Griffin Act (Labor-Management Reporting and Disclosure Act of 1959) protects union members' democratic rights and requires union financial reporting, elections, and accountability.

Wordplay to remember:

“Landrum-Griffin keeps union leaders from griftin’!”

Think: No griftin’ (cheating), fair votin’, and money reportin’.

• Fair votin’ = Democratic union elections

• No griftin’ = Prevents corruption

• Money reportin’ = Requires financial transparency

ADEA

ADEA (Age Discrimination in Employment Act) generally prohibits age discrimination against workers aged 40 OR OLDER, with no upper age cutoff, at employers with 20 or more employees. Most forced retirement based solely on age is unlawful, with narrow exceptions.

affirmative action

Affirmative action refers to lawful measures intended to address unequal opportunity or past discrimination. It does NOT automatically permit giving someone a job solely because they belong to a protected group; legal limits and context matter.

ADA

ADA (Americans with Disabilities Act)

Definition: Federal law that prohibits discrimination against people with disabilities and requires reasonable accommodations.

• Title I: Employment discrimination protections (generally employers with 15+ employees).

• Title II: State/local government services, including public transportation.

• Title III: Public accommodations (restaurants, stores, hotels, etc.).

• Title IV: Telecommunications accessibility.

• Reasonable Accommodation: Employers must accommodate qualified employees with disabilities unless it causes undue hardship.

• Medical Exams: Generally allowed after a conditional job offer if required of everyone entering the same job category.

Example: An employee with a disability requests an adjusted work schedule. The employer generally must provide it if reasonable and not an undue hardship.

Word Association: ADA = Access, Disability, Accommodation

Memory Trick: 1 = Jobs, 2 = Government, 3 = Businesses, 4 = Phones.

what is defined as having a disability

Under the ADA, disability means (1) a physical or mental impairment substantially limiting a major life activity, (2) a record of such impairment, OR (3) being regarded as having such an impairment. It is not limited to a visible disability.

employment discrimination defenses

Employers may defend certain discriminatory employment practices using:

• Business Necessity: A job-related practice is necessary for business operations, even if it has a discriminatory effect.

• BFOQ (Bona Fide Occupational Qualification): Certain protected traits may be legitimate job requirements (e.g., sex, religion, national origin, or age). Race is never a BFOQ.

• Bona Fide Seniority System: Employment decisions based on a legitimate seniority system are generally allowed if not intended to discriminate.

Example: A women's locker room may hire only female attendants under a valid BFOQ based on privacy.

State anti discrimination laws

State Anti-Discrimination Laws: State laws that can provide more protection against workplace discrimination than federal laws.

• More groups: May protect people not covered by federal law.

• Smaller employers: May apply to businesses with fewer employees.

• Stronger remedies: May offer greater compensation or other legal protections.

Exam word association:

Federal law = Minimum protection.

State law = Can add more protection.

lilly ledbetter act

The Lilly Ledbetter Fair Pay Act of 2009 says each discriminatory paycheck can restart the deadline to challenge discriminatory compensation. It does NOT mean there is unlimited time after the last discriminatory paycheck to file a charge.

civil rights act of 1964 title vii

Title VII of the Civil Rights Act of 1964 generally prohibits employment discrimination because of race, color, religion, sex (including pregnancy and sexual orientation/gender identity), or national origin. It generally covers employers with 15 or more employees. A worker usually files an EEOC charge before suing and obtains a notice of right to sue.

civil rights act of 1991

Civil Rights Act of 1991: Strengthened protections against workplace discrimination by allowing employees to seek additional money damages and jury trials in certain discrimination cases.

• Compensatory damages: Money to cover harm caused by discrimination.

• Punitive damages: Extra money to punish employers for especially serious intentional wrongdoing.

• Damage limits: Maximum awards depend on employer size.

• Jury trials: Employees can request a jury in certain discrimination cases.

disparate impact

Disparate impact means a seemingly neutral employment policy disproportionately harms a protected group, even WITHOUT intent to discriminate, unless legally justified. Clue: neutral rule, unequal results.

disparate treatment

Disparate treatment means an employer intentionally treats someone differently BECAUSE of a protected trait. Clue: purposeful unequal treatment, even if the employer gives a different explanation.

EEOC

EEOC (Equal Employment Opportunity Commission)

A federal government agency that protects employees from workplace discrimination and enforces laws requiring fair treatment at work.

Example:

Sarah works at a company and applies for a promotion.

• Sarah is qualified for the promotion.

• Her manager refuses to promote her because she is pregnant.

• Sarah believes she was discriminated against and files a complaint (called a charge) with the EEOC.

• The EEOC may investigate the situation and try to resolve it.

• Result: The EEOC may take legal action or issue a right-to-sue notice allowing Sarah to pursue a lawsuit.

equal pay act

Equal Pay Act requires equal pay for women and men at the same establishment doing substantially equal work requiring similar skill, effort, responsibility, and working conditions, subject to lawful pay differences. Job titles need not be identical; “similar positions” alone is not the exact test.

protected classes

Protected classes are groups or traits protected against particular kinds of discrimination by law, such as race, color, religion, sex, national origin, age (40+ under ADEA), disability, and genetic information. The relevant law determines which traits are protected.

pregnancy discrimination act

Pregnancy Discrimination Act amended Title VII to prohibit discrimination because of pregnancy, childbirth, or related medical conditions. Affected workers must be treated consistently with others similar in ability or inability to work; separate accommodation protections may also apply.