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Employment Law and Rule of Law

Provide the rule of law raised by the issue in each question, apply the elements of the law to the facts in the scenario, and conclude with an answer to the question asked. Answer the questions with responses of at least 250 words.

Scenario 1

Patricia began working for Encyclopedia Britannica as a part-times sales representative in 1986. Her position required selling Encyclopedia Britannica's educational products. Until 1999, she worked as a part-times sales representative and then a district manager for Encyclopedia Britannica. In 1999, Encyclopedia Britannica decided to separate the parent division from the school and library division and reorganize its sales force by "outsourcing:" contracting with individual "regional directors" who would in turn contract with individual sales representatives. The same people who had worked for Encyclopedia Britannica under the previous arrangement filled many of the positions under the new structure, in which branch managers became separately incorporated regional directors and district managers while sales representatives took positions with the newly formed companies.

Patricia signed a contract with Sam, a former Encyclopedia Britannica branch manager who had formed her own corporation and gathered a sales force comprised largely of former Encyclopedia Britannica sales representatives. Patricia eventually became a territory coordinator, a position slightly above sales representative but still reporting to Sam. In 2001, Patricia was told that she was losing her territory and would no longer be selling Encyclopedia Britannica products. Patricia sued Encyclopedia Britannica, claiming that the loss of her territory was effectively a termination. Was her suit successful, i.e., was Patricia an employee or an independent contractor? Why?

Scenario 2

At the end of all her written communications, an employee writes, "have a blessed day." One of employer's most important clients requests that employee not do so, and employer asks employee to stop. Employee refuses, saying it is a part of her religion. If employee sues the employer for religious discrimination, then is she likely to win? Why or why not?

Scenario 3

Answer two of the following questions:
a. Can race or gender be the only factor in an employment decision?

b. If race or gender can be the only factor in an employment decision, how long can it be a factor?

c. What is the difference between an affirmative action goal and a quota, or is there one?

d. What is the proper comparison to determine if there is an underrepresentation of women or minorities in the workplace?

Scenario 4

During the interview Jean had with Marcus Accounting Firm, Jean was asked whether she had any children, whether she planned to have any more children, to what church she belonged and what her husband did for a living. Are these questions illegal? Why or why not?

Scenario 5

David comes into the office and says to Sue: "Good morning! You look great today! Oops, I'd better not say that. That's sexual harassment." Is David correct? Explain.

Solution Preview

Scenario 1: Patricia began working for Encyclopedia Britannica as a part-times sales representative in 1986. Her position required selling Encyclopedia Britannica's educational products. Until 1999, she worked as a part-times sales representative and then a district manager for Encyclopedia Britannica. In 1999, Encyclopedia Britannica decided to separate the parent division from the school and library division and reorganize its sales force by "outsourcing:" contracting with individual "regional directors" who would in turn contract with individual sales representatives. The same people who had worked for Encyclopedia Britannica under the previous arrangement filled many of the positions under the new structure, in which branch managers became separately incorporated regional directors and district managers while sales representatives took positions with the newly formed companies.

Patricia signed a contract with Sam, a former Encyclopedia Britannica branch manager who had formed her own corporation and gathered a sales force comprised largely of former Encyclopedia Britannica sales representatives. Patricia eventually became a territory coordinator, a position slightly above sales representative but still reporting to Sam. In 2001, Patricia was told that she was losing her territory and would no longer be selling Encyclopedia Britannica products. Patricia sued Encyclopedia Britannica, claiming that the loss of her territory was effectively a termination. Was her suit successful, i.e., was Patricia an employee or an independent contractor? Why?

Response:

Although Patricia signed a contract initially, making her an independent contractor, it appears she moved to being considered an employee when she became territory coordinator (e.g. a position slightly above sales representative but still reporting to Sam). If Patricia is now an employee (versus independent contractor) as it appears she is, then her suit would probably not be successful, mainly because of the "at will' legislature, where the employer can terminate employment without reason as long as it is not under a protected category (e.g., discrimination in violation of Title VII), where it appears not to be.

However, if Patricia was still under contract, she could make the case for wrongful termination (see excerpt below, and Patricia would need to have these conditions to be considered an independent contractor. So, who is an is an Independent Contractor (IC)? "A general rule is that the [employer] have the right to control or direct only the result of the work done by an independent contractor, and not the means and methods of accomplishing the result. Example: Vera Elm, an electrician, submitted a job estimate to a housing complex for electrical work at $16 per hour for 400 hours. She is to receive $1,280 every 2 weeks for the next 10 weeks. This is not considered payment by the hour. Even if she works more or less than 400 hours to complete the work, Vera Elm will receive $6,400. She also performs additional electrical installations under contracts with other companies that she obtained through advertisements. Vera is an independent contractor" (http://www.irs.gov/businesses/small/article/0,,id=99921,00.html).

Interestingly, there is no set definition of the term "independent contractor" and as such, one must look to the interpretations of the courts and enforcement agencies to decide if in a particular situation a worker is an employee or independent contractor. "In handling a matter where employment status is an issue, that is, employee or independent contractor, DLSE starts with the presumption that the worker is an employee. Labor Code Section 3357. This is a rebuttable presumption however, and the actual determination of whether a worker is an employee or independent contractor depends upon a number of factors, all of which must be considered, and none of which is controlling by itself. Consequently, it is necessary to closely examine the facts of each service relationship and then apply the law to those facts. For most matters before the Division of Labor Standards Enforcement (DLSE), depending on the remedial nature of the legislation at issue, this means applying the "multi-factor" or the "economic realities" test adopted by the California Supreme Court in the case of S. G. Borello & Sons, Inc. v Dept. of Industrial Relations (1989) 48 Cal.3d 341. In applying the economic realities test, the most significant factor to be considered is whether the person to whom service is rendered (the employer or principal) has control or the right to control the worker both as to the work done and the manner and means in which it is performed."

In fact, there are additional factors that may be considered depending on the issue involved are:

1. Whether the person performing services is engaged in an occupation or business distinct from that of the principal;

2. Whether or not the work is a part of the regular business ...

Solution Summary

Referring to the scenarios, this solution provides the rule of law raised by the issue in each question, applies the elements of the law to the facts in the scenario, and then concludes with an answer to the question asked.

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