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Hospitality Business Law > Exam 4 > Flashcards

Exam 4 Flashcards

1
Q

Partnership Law

A
  • Usually a forced business arrangement
  • 2 or more actors involved in some commercial activity who haven’t incorporated

Basic form - general partnership
•all partners manage the business and are personally liable for its debts
•strict liability to all parties injured by the partnership

2 other types of partnerships

1) limited partnership (LP)
•limited partners relinquish their ability to manage the business in exchange for some limited liability
2) limited liability partnership (LLP)
•all partners have some degree of limited liability

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2
Q

General partnerships

A
  • form of co-ownership by several persons
  • can be sued in partnerships name
  • Partnership Agreement outlines operation (oral or written)
  • unlimited personal liability
  • each partner has management and control
  • consent required to transfer interest
  • partnership not a tax paying entity, passed thru to partners
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3
Q

Types of Entities

A

1) sole proprietorship
2) partnership
—general partnership
—limited partnership
—limited liability partnership
3) corporation
—C-corp
—S-corp
—professional corporation (PC)
4) limited liability company (LLC)

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4
Q

Corporation

A

•separate and distinct legal entity from owners
•continuity of existence despite death (buy/sell agreement)
•no personal shareholder liability
—only corporation will be liable for debts
•FORMALITIES
—must be formed with state by filing Articles of Incorporation, preparation of Bylaws and Minutes
•LIMITATIONS
—cannot appear in proper court except in small claimed actions
•alter ego/piercing corporate veil issues

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5
Q

C-Corporations

A
  • every corporation starts out as c-corp
  • no limit on number of shareholders
  • no limits/requirements on shareholder residency
  • double taxation (corporation level and shareholder/personal level)
  • no limit on classes of stock (common/preferred)
  • future services not adequate capitalization
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6
Q

S-Corporations

A
  • starts out as c-corp but files “S” election with IRS & FTB
  • max. 100 shareholders
  • shareholders limited to individuals, estate and certain trusts (cannot be other entities)
  • must all be US citizens or residents aliens
  • only one class of stock
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7
Q

Limited Liability Company (LLC)

A

hybrid been corporation and partnership
—no double taxation, limited liability

STRUCTURE
—centralized management is optional and may be by managers and/or members

LIABILITY
—alter ego liability
—lack of formalities not a factor for alter ego
—each member can bind LLC

CREATION
—must file Articles of Organization with Secretary of State, parties entering into Operating Agreement

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8
Q

Piercing the corporate veil

A

When corporation shareholders can be held responsible/are liable for business actions and debts
—rare circumstances
—ex: Bernie Madoff, when corporation formed to cover illegal activities

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9
Q

Professional corporations (PC)

A

licensed professional incorporates their business
—incorporating doesn’t protect them from professional malpractice
—not personally insulted from malpractice, but otherwise the incorporation works the same

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10
Q

Employment-at-Will Doctrine

A
  • No agreement exists defining how long the employment relationship will last
  • either the employer or employee can terminate employment at any time
  • the employer can terminate with cause or for no cause
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11
Q

An employer cannot terminate an employee for:

Under employment at will doctrine

A

•refusing to carry out an illegal activity
•exercising a legal right
—ex: filing a workers comp claim
•performing a legal duty
—ex: jury duty or army reserve
•whistleblowing (reporting the employers wrongdoing)

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12
Q

Exceptions to the Employment-at-Will Doctrine

A

1) statutory exceptions/public policy
2) employment “for cause”
3) contract for a fixed period of time

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13
Q

For Cause/Just Cause Employment Contracts

A

Just cause = burden of proof or standard that an employer must meet to justify disciplinary actions or discharging an employee
—usually refers to violation of company rule/policy

Employer must agree to be ‘just cause/for cause employer’ - changes burden of proof

When arbitrator looks at a discipline dispute, first asks if employees wrongdoing has been proven by employer
—then asks if discipline should be upheld

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14
Q

7 Common Tests to Determine ‘Just Cause’

A

1) was employee forewarned of the consequences of their actions?
2) are employers rules reasonably related to business efficiency and the performance they might reasonably expect from employee?
3) was an effort made before discipline/discharge to determine whether the employee was guilt as charged?
4) was investigation conducted fairly and objectively?
5) did the employer obtain substantial evidence of the employees guilt?
6) were the rules applied fairly and without discrimination?
7) was the degree of discipline reasonably related to the seriousness of the employees offense and the employees past record?

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15
Q

Equal Pay Act of 1963

A

Requires that men and women in same workplace performing similar jobs must be paid the equally
—equal pay for equal work
—job duties not title determine if they are substantially equal

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16
Q

Sole proprietorship

A
  • entity where there is no legal distinction between the owner and the business
  • personally responsible for all debts of the business
  • unlimited personal liability for losses
  • complete management
  • no formalities
  • Net profits taxable to owner
  • fictitious business name filing
17
Q

Civil Rights Act of 1964 -Title VII

A

Prohibits discrimination by covered employers on basis of race, color, religion, sex, or national origin
—also prohibits discrimination based on someone’s associations with another person of particular race, color, religion, sex, or national origin (ie, interracial marriage)
—supplemental legislation also cover pregnancy, age, and disability
—applies to hiring, firing, pay, job assignments, promotions, layoff, training, fringe benefits, and any other term/condition of employment

18
Q

Age Discrimination in Employment Act

A

Forbids age discrimination against people who are 40 or older
—some states protect from discrimination against younger workers

  • Not generally illegal for employer to favor older worker over younger one, even if both are over 40
  • can occur if both employee and person who inflicted the discrimination are over 40
19
Q

Rehabilitation Act of 1973

A

Prohibits discrimination on basis of disability in programs/employment matters under or related to the federal government
—standards for determining discrimination same as under ADA

20
Q

Americans with Disabilities Act of 1990

A

Wide ranging civil rights law that prohibits discrimination based on disability (under certain circumstances)

Defines disability as: “a physical or mental impairment that substantially limits a major life activity”
—determined in a case by case basis
—sims things excluded (ie. Current substance abuse or visual impairment that can be corrected with prescription lenses)

21
Q

Family Medical Leave Act of 1993

A

Requires employers to provide job-protected and unpaid leave for qualified medical and family reasons
—include: personal or family illness, family military leave, pregnancy, adoption, or foster care placement of a child

Allows eligible employees to take up to 12 weeks of unpaid leave during any 12-month period

22
Q

DEFENSES TO STATUTORY VIOLATIONS OF AT-WILL DOCTRINE

Defenses Applicable to Per Se Claims of Wrongful Discrimination

A

1) bona ride occupational qualification
—policy stating that only individuals of a particular class can do a certain type of job
—represents a legitimate qualification for a job that is actually not aimed at a particular class
—ex: male guards required for male prison

2) merit
—poor job performance overshadows discrimination claims

3) seniority/longevity
–so long as it is followed uniformly by the employer

23
Q

Sexual Harassment

A

Prohibited under Title VII of Civil Rights Act and Violence Against Women Act

2 Basic Categories:

1) quid pro quo
2) hostile work environment

24
Q

Quid pro quo | sexual harassment

A

Occurs when the perpetrator makes an aspect of employment (hiring, promoting, etc.) contingent on the victim’s providing sexual favors

25
Q

Hostile work environment | sexual harassment

A

When there is:

1) a frequency and severity of discriminatory conduct
2) it is physically threatening (not a “mere offensive utterance”)
3) it unreasonably interferes with an employees work performance

26
Q

Remedies in Employment Cases

A

-goal of law is to put victim back in position they would have been in if discrimination hadn’t occurred

-types of relief depend on discriminatory action and effect it had on victim
—ie, reinstatement and payback of wages if someone wrongfully terminated

  • employer also required to stop discriminatory practices now and in future
  • victim may be able to recover attorney’s fees, expert witness fees, and court costs

-compensatory and punitive damages may be awarded in cases in intentional discrimination
—compensatory= out-of-pocket expenses caused by discrimination and compensation for emotional harm

27
Q

Burden of persuasion in wrongful termination cases

A

Burden on the employee
—employment at will doctrine

If it’s a “for cause/just cause” relationship, burden on the employer

28
Q

Whistleblower protection laws

A

Afford an employee protection against retaliation if they lawfully report on their employer, exercise sir legal rights, etc.

29
Q

Union

A

An organization that represents employees interests to management on such issues as wages, work hours, and working conditions

30
Q

Why do employees join unions?

A

1) job dissatisfaction

2) employees lack influence with management to make needed changes

31
Q

Wagner Act

A
  • passed during Great Depression
  • designed to protect employees rights to form and join unions and to engage in activities like striking, picketing, and collective bargaining

•created the National Labor Relations Board
—independent federal agency
—administer certification elections
—prevent and remedy unlawful acts (unfair labor practices)
—identified 5 illegal labor practices

32
Q

5 illegal labor practices identified by Wagner Act

A

1) do not keep employees from forming unions or collective bargaining
2) do no dominate or interfere with the formation of administration of a union or provide financial support for Union
3) do not discourage against employee to encourage or discourage union membership
4) do not discharge or discriminate against employee who filed charges (gave testimony) under Act
5) do not refuse to bargain collectively with the union that employees chose

33
Q

Taft Hartley Act

Labor Management Relations Act of 1947

A
  • amended NLRA to add Union unfair labor practices
  • set up Union security options for states
  • allowed unions to be sued by employers
  • outlined 6 unfair Union labor practices

*essentially give employers more rights in regards to dealing with unions
—allows them to enforce collective bargaining agreements
—certain items that must be negotiated in these contracts, in good faith

34
Q

6 unfair Union labor practices outlined in Taft-Hartley Act

A

1) cannot influence employers choice of representation in collective bargaining
2) causing or attempting to cause an employer to discriminate against any employee who is not a member of the Union
3) refusing to bargain with employer in good faith
4) asking or requiring its member to boycott products made by a firm engaged in a labor dispute with another Union
5) never charge employees excessive or discriminatory Union dues as a condition of membership
6) never ask an employee to pay for services that are not performed

35
Q

Landrum-Griffen Act

A

Designed to protect Union members and their participation in unions affairs, allowing gov’t to regulate union activities:

  • each Union has a bill of rights to ensure min. standards of internal union democracy
  • each union must give their constitution to Department of Labor
  • each union must report its financial activities and financial interests of leaders to Department of Labor
  • Union elections regulated by gov’t
  • Union leaders have fiduciary responsibility to use union money and property for the membership, not for own personal gain
36
Q

Mandatory bargaining topics

A

Topics that both unions and management consider fundamental to organizations labor relations:

1) wages
2) hours
3) employment conditions

37
Q

Closed Shop

A

PRE-ENTRY CLOSED SHOP= Agreement under which employer agrees to hire Union members only
-employees must remain members of union at all times to stay employed

POST-ENTRY CLOSED SHOP = requires all employees to join the union if they’re not already members
*in a Union shop, union must accept as member any person hired by the employer

Taft-Hartley act outlawed closed shop but permits the union shop

  • except in right to work states, Union shop illegal there too
  • an employer can’t agree with Union to only hire Union members, but may agree to require employees to join Union or pay equivalent fees
38
Q

Right to work

A

Prevents employer-Union contracts from excluding non-Union workers or requiring employees to pay Union fees

Hospitality Business Law (4 decks)

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