Employment Laws
• Social reasons
– Minimum living standards
– Safe workplace
– Fair treatment
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Fair Labor Standards Act
• All businesses that affect interstate commerce
• Exception – business whose only regular
employees are owner & family
• Established minimum wage
– Exception – learners, apprentices, handicapped workers
• Hours after 40 per week: time and a half
– No limits on hours
– No right to refuse overtime
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Fair Labor Standards Act
• Exempt employees (from overtime)
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Professionals
Executives/managers
Those who use discretion & judgment
Teachers
Salespeople
Casual babysitters
Farm workers
Some specific industries
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Fair Labor Standards Act
• Child Labor
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18+: any job
16-17: “nonhazardous jobs” & unlimited hours
14-15: “limited hours
Exemptions
• Child actors: exempt except earnings must be put in
trust
• Farm work
• Work-study programs
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Fair Labor Standards Act
• Enforcement
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Employee complaints
Labor Department investigations
Record keeping requirements
Civil and criminal penalties
Corporations & officers liable
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Fair Labor Standards Act
• Equal Pay Act of 1963
– Disparate pay may only be based on merit and seniority
– Jobs do not have to be identical
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Equal effort
Equal skill
Equal responsibility
Similar working conditions
– Includes exempt employees
– Defenses
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Seniority
Merit
Piecework
Any factor other than sex
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Social Security
• 1935 Act – minimal retirement income for
workers in industry & commerce
• 1939 amendment added dependents
• 1957 disability payments/workers in
households, farms, military, clergy, state &
local government, self-employed
• 1965 Medicare
• 1973 amended Medicare
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Social Security
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Funded equally by employer and employee
Tax rate has risen
Maximum salary has risen
COLA
1984 – federal workers
Benefits taxable
Current retirees draw $4 for every $1 paid
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Regulations for Retirement Plans
• ERISA - 1974
– Medical, retirement, income-deferral plans
– Reporting
• Annual reports
• Annual statements to employees
• Accounting as current expenses
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Fiduciary duties
Investment restrictions
Pension Benefit Guaranty Corporation
Vesting
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Family & Medical Leave Act of
1993
• Social issues
– Women in the work force
– Single-parent families
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12 weeks unpaid leave w/health coverage
Return to equivalent job
Employers w/50 or more employees
Employees over 1 year service
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OSHA
• Businesses with 1 or more employees
• OSHA may award temporary or permanent
variances
• Prioritized inspections
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Conditions that could result in death
Fatal accident sites
Employee complaints
Hazardous industries
Random inspections
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OSHA
• Whirlpool Corp. v. Marshall
– Employees may refuse to work in unsafe conditions
• Pre-emptive counseling
• Search warrants required
• Penalties
– Fines
– Prison
• Drug & alcohol screening
• 50% of states administer OSHA
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OSHA
• Criticisms
– Nature of regulations
• Vague: “all places of employment…kept clean &
orderly”
• Trivial: “irregularities in wood used for ladders”
– Cost of compliance
– Attitude of OSHA employees
– No relation to safety: “no ice in drinking water”
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Unemployment Compensation
• State laws
– Administered and taxed by state
– Benefits vary
• Employers
– One or more employees/20 or more weeks per year
– Wages greater than $1500
– Exempt businesses
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Educational, religious or charitable organizations
Farm labor
Family members
Federal & state government
• Payroll tax paid by employers/depends on
experience
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Unemployment Compensation
• Eligibility
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Involuntarily terminated
Able & available for work
Seeking employment
Has not exceeded maximum payment
• Safe harbor or encouragement to
unemployment?
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Worker’s Comp
• Social purpose
– Benefits and medical care for work-related injuries
• Interpretations
– Includes stress
– Mental illness
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Injury caused by a coworker
Fault
Independent contractors
Other suits
Insurance
Scheduled benefits
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Workers’ Comp
• Reforms
– Fraud
• “work-related” interpreted broadly
• No self-inflicted injuries
– Tax-free benefits
– Conflicts with ADA
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Unions
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Railway Labor Act 1926
Norris-LaGuardia Act 1932
Wagner Act 1935 – NLRB
Taft-Hartley Act 1947
Landrum-Griffin Act 1959
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Unions
• Good faith bargaining
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Insurance plans
Maternity leaves
Plant rules
Subcontracting procedures
Strikes
Layoffs
Union bookkeeping rules
Meal periods
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Unions
• Protected concerted activities
– Public advertisements
– Picketing
– Nonunion activities
• Discussion of employment issues
– Strikes
– Pressure on the board and shareholders
– Use of special interest groups/regulators
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Unions
• Unfair practices by employees
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Hot cargo agreements
Slowdowns
Featherbedding
Secondary boycotts
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Unions
• Employer rights
– Freedom of speech
– Right-to-work laws
– Right to an enforceable collective bargaining agreement
• Employer weapons
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Plant closings
Plant flight
Lockouts
Conferring benefits
Bankruptcy
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Discrimination
• Title VII – Fair Employment Practices Act
– Covers
• Groups with 15 or more employees
• State and local agencies
– Not covered
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Aliens outside the U.S.
Religious & educational organizations
Federal government/Congress
American Indians
Independent contratctors
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Discrimination
• Disparate Treatment
– Employee treated differently because of race, color,
national origin, or sex
– Employer has burden of proof
• Disparate Impact
– Employment practices unintentionally impact protected
group
– Statistical
– Employer must prove ‘business necessity’
• Pattern or practice of discrimination
– Against groups of people
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Discrimination
• Gender issues
– Sexual Harassment
– Pensions
– Pregnancy
• Religious discrimination
• Racial discrimination
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Title VII Defenses
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BFOQ
Seniority/Merit systems
Aptitude testing
Employee misconduct
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Title VII Enforcement
• Process
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Complaint from employee or EEOC
EEOC notifies employer within 10 days
EEOC investigates (180 days)
Employee can still sue employer
• Remedies
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Injunctions
Back pay
Punitive damages
Attorney’s fees
Caps on sex, religion, & disability cases
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Affirmative Action
• Requirements
– Employers who are obligated because of past
wrongs
– State & local agencies
– Colleges & universities that receive federal
funds
– Government contractors
– Business that work on federal projects
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Discrimination
• Age Discrimination in Employment Act
1967 (+40)
• Rehabilitation Act 1973
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Americans with Disabilities Act
• 15 or more employees
• Disabilities
– Physical or mental impairments that substantially limit
one or more of a person’s major life activities
– Any record of such impairment
– A person’s being regarded as having such impairment
• Employee must be able to perform essential
functions of job with or without reasonable
accommodations
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Other Laws
• Immigration Reform & Control Act 1986
• COBRA
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International Labor
• International Covenant on Economic,
Social, and Cultural Rights
• International Labor Organization
• National Labor Committee
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