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Chapter 31Employment and Worker Protection

Laws

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Employment at Will• At-will employees – employees

who do not have employment contracts.

• Wrongful discharge – the discharge of an employee in violation of a statute, an employment contract, or public policy, or tortiously.– The employee can recover

damages and other remedies.

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Employment at Will (continued)

Statutory Statutory ExceptionsExceptions

Contract Contract ExceptionsExceptions

Public Policy Public Policy ExceptionException

Tort ExceptionsTort Exceptions

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Workers’ Compensation ActsWorkers’ Compensation Acts

Acts that compensate workers Acts that compensate workers and their families if workers and their families if workers are injured in connection with are injured in connection with their jobs.their jobs.

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Workers’ Compensation Acts

• Workers’ compensation benefits – vary by state. – are paid according to preset

limits established by statute or regulation.

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Workers’ Compensation Insurance

• States usually require employers to:– To pay for workers’

compensation insurance, or– To self-insure by making

payments into a contingency fund.

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Employment Related Injury

• To recover under workers’ compensation, the worker’s injuries must have been employment-related.

• Stress may be a compensable work-related injury.

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Exclusive Remedy

• Workers’ compensation is an exclusive remedy.

• Workers cannot sue their employers in court for damages.– Exception occurs when an

employer intentionally injures an employee.

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Occupational Safety and Health Act (1970)

• Enacted to promote safety in the workplace.

• Established the Occupational Safety and Health Administration (OSHA).

• Virtually all private employers are within the scope of the act.

• Federal, state, and local governments are exempt.

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Occupational Safety and Health Act (continued)

• The act imposes record keeping and reporting requirements on employers.

• Employers are required to post notices in the workplace informing employees of their rights under this act.

• OSHA is empowered to administer the act and adopt rules and regulations to interpret and enforce it.

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Occupational Safety and Health Act (continued)

• OSHA is empowered to inspect places of employment for health hazards and safety violations.

• If a violation is found, OSHA can issue a written citation.– Requires the employer to

abate or correct the situation.

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Types of OSHA StandardsSpecific Duty Standard• Addresses a safety problem of a

specific duty nature.– e.g., requirement for a safety guard

on a particular type of equipment

General Duty Standard• Duty that an employer has to

provide a work environment “free from recognized hazards that are causing or are likely to cause death or serious physical harm to his employees.”

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Fair Labor Standards Act (FLSA)

• Federal act enacted in 1938 to protect workers.

– Prohibits child labor

– Establishes minimum wage requirements

– Establishes overtime pay requirements

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Child Labor• The FLSA forbids the use of

oppressive child labor.• It is unlawful to ship goods

produced by businesses that use oppressive child labor.

• The Department of Labor defines the standards for lawful child labor.

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Minimum Wage and Overtime Pay

• Managerial, administrative, and professional employees are exempt from the FLSA’s wage and hour provisions.

• Employers are required to pay covered (non-exempt) workers at least the minimum wage for their regular work hours.

• Overtime pay is also mandated.

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Minimum Wage• Set by Congress and can be

changed.• Employers are permitted to

pay less than minimum wage to students and apprentices.

• An employer may reduce minimum wages by an amount equal to the reasonable cost of food and lodging provided to employees.

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Overtime Pay• An employer cannot require

nonexempt employees to work more than 40 hours per week unless they are paid one-and-a half times their regular pay for each hour worked in excess of 40 hours.

• Each week is treated separately.

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Family and Medical Leave Act• Applies to employers with

50 or more workers, federal, state, and local government workers

• Employee must have worked for employer for at least one year

• Employee must have performed 1250 hours of work in previous twelve-month period

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Family and Medical Leave Act (continued)

• Provides up to 12 weeks of unpaid leave for:– Birth of child– Placement of child for

adoption or foster care– Serious health condition– Care for spouse, child, or

parent with serious health condition

• Must use all available sick time and vacation time before it is applied

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Family and Medical Leave Act (continued)

• Employee mist be restored to either same or equivalent position

• Must be given equivalent pay and benefits

• No accrual of seniority

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Consolidated Omnibus Budget Reconciliation Act (COBRA)

• Separated employee must be offered the opportunity to continue group health program

• Separated employee bears cost plus administration fees

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Employee Retirement Income Security Act (ERISA)

• If employer offers a pension plan ERISA applies.– Establishes record-keeping

and disclosure requirements– Sets requirements for vesting– Establishes percentage of

assets that can be invested in employer’s securities

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Immigration Reform and Control Act (IRCA)

• Administered by U.S. Immigration and Naturalization Service

• Makes it unlawful to hire illegal immigrants.– Employers must keep records.– Employers must file I-9.

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Other Federal Employment Laws (1 of 2)

Law Description

Employee Retirement Income Security Act (ERISA)

Prevents fraud and other abuses associated with private pension plans.

Consolidated Omnibus Budget Reconciliation Act (COBRA)

Permits employees and their beneficiaries to continue their group health insurance after an employee’s employment has ended.

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Other Federal Employment Laws (2 of 2)

Law Description

Family and Medical Leave Act (FMLA)

Guarantees workers up to twelve weeks of unpaid leave in a twelve-month period to attend to family and medical emergencies

Immigration Reform and Control Act (IRCA)

Makes it unlawful for employers to hire illegal immigrants. Employers are required to complete INS Form I-9 attesting legal U.S. citizenship or legal alien status of each employee.