Business Law IX: Other Federal Laws/Regulation Flashcards Preview

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Flashcards in Business Law IX: Other Federal Laws/Regulation Deck (26):

Title VII of Civil Rights Act of 1964

Forbids Discrimination in employment based on race, color, religion, sex, national origin


Title VII applies to

1. Employers with 15 or more employees for 20 weeks and whose business affects interstate commerce
2. Employment agencies
3. Labor Unions
4. Federal/State/Local government employees


Title VII covers virtually all employment practices, including:

1. Hiring
2. Promotion
3. Transfers
4. Firings
5. Compensation
6. Job assignments


Title VII is enforced by

1. Equal Employment Opportunity Commission (EEOC)
2. Civil actions by individual plaintiffs


Types of Discrimination

1. Intentional - disparate treatment
2. Discriminatory impact - disparate impact (requiring h.s. diploma to be janitor)


Employer Defense: Bona Fide Occupational Qualification (BFOQ)

If requirement that has discriminatory impact is BFOQ pertaining directly to needs of job, then not Title VII violation


Employer Defense: Bona Fide seniority/merit system

No affirmative action plan can override such systems


Age Discrimination in Employment Act (ADEA)

Purpose is to eliminate discrimination in individuals 50 or over.


Americans with Disabilities Act (ADA)

Purpose is to ensure our economy takes advantage of skills/abilities that disabled persons offer.


Social Security Benefits

1. Purpose - partial replacement of earnings when a worker retires
2. Mechanism - monthly benefits paid to retired insured worker from 62 onward
3. "fully insured" worker (minimum of 10 yrs contribution), entitled to:
- survivor benefits
- disability benefits
- old age retirement benefits



1. Covers portion of costs of hospitalization/med benefits of insured workers/spouses 65+


Disability Benefits

1. Covers severe physical/medical impairment preventing work for > 1 yr or expected to result in death
2. Must be total disability
3. After 24 months, medicare kicks in


Federal Insurance Contributions Act (FICA)

1. Imposes SS tax on employers, employees, self-employed
2. Applies only to part of compensation deemed "wages"


Current FICA Rates

7.65% (6.2% SS, 1.45% Medi)

SS currently capped at $117K


"Willful Failure" to pay tax liability

Awareness of the obligation and conscious/voluntary payment of someone else with funds that should have been used to pay the tax owed.


Federal Unemployment Tax (FUTA)

1. Purpose - provide unemployment compensation benefits to workers who lose jobs/can't find new ones
2. Mechanism - federal, state, only $7K


Fair Labor Standards Act (FLSA)

1. Applies to all businesses that affect interstate commerce
2. Four major sections:
- Minimum Wage
- Overtime Standard
- Child Labor Restrictions
- Equal Pay Provision


Minimum Wage

1. Must be paid = $7.25
2. Year end bonuses not figured in
3. Interns included if their work gives a company immediate advantage or they displace a regular worker
4. Does not cover independent contractors


Overtime Standard

1. Employees working > 40/week mus receive 1.5x
2. No "offset" for weeks where employees work < 40
3. May use hourly, weekly, monthly pay base provided minimum hourly rate/overtime standards are met


Child Labor provisions

1. Excludes those under 18 from hazardous jobs
2. 16 is basic minimum age for employment
3. 14-15 limited to certain occupations such as sales/clerical
4. < 14 can only work for parents or court-approved contracts


Equal pay

1. Prohibits from discrimination on basis of sex by paying unequal wages for same work
2. Allows pay variance based on seniority, merit, quality/quantity of work
3. Covers even executive, administrative, professional employees as well as fed/state govt employees


Employee Retirement Income Security Act of 1970 (ERISA)

1. Protects employee rights in existing pension plans and offers tax incentives to employers/employees who fund them
2. Applies to employee pension/welfare benefit plans
3. If employer sets up pension plan, must vest immediately - employees have ability to contribute
4. Must fully vest after 5 years
5. Must have written plan to avoid mismanagement


Defined-benefit pension plan

1. Ensure eligible employees specified monthly income for life
2. insured by Pension Benefit Guaranty Corporation (PBGC)
3. some plans "integrated" with SS benefits


Defined-contribution pension plan

1. Specify annual fixed-share contributions to be made by employer and hope wise investing will provide generous benefits
2. investment decisions often can me made by employee
3. no PBGC insurance


Federal Consolidated Budget Reconciliation Act (COBRA)

Amended ERISA to provide health insurance in some circumstances after job loss.

Usually 18 months.


Family Medical Leave Act of 1993 (FMLA)

1. Purpose - balance employee's workplace demands with needs of family
2. Unpaid leave of 12 weeks for certain events such as birth, adoption, serious health issue