Business Law
Exam Solutions
Course Introduction
Business Law provides students with a foundational understanding of the legal principles and frameworks that govern commercial transactions and business organizations. The course covers key topics such as contract law, agency, sales, negotiable instruments, business structures (including partnerships, corporations, and limited liability companies), employment law, and the regulatory environment. Emphasis is placed on the practical application of legal concepts to real-world business scenarios, highlighting ethical considerations and the impact of legal decisions on business operations. This course equips students with the knowledge to identify and address legal risks in the business environment, fostering informed decision-making and compliance with the law.
Recommended Textbook
Employment Law for Business 8th Edition by Dawn
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Bennett
Page 2
Chapter 1: The Regulation of the Employment Relationship
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Q1) The Food Cult Restaurant (FCR)employs part-time workers through a staffing firm.After the staffing firm sent over a part-time waitress,FCR asked the firm to replace her with someone from a different race.If the replaced waitress proceeds with a discrimination claim under Title VII of the Civil Rights Act,FCR cannot be liable because the part-time waitress was never its employee.
A)True
B)False
Answer: False
Q2) As used by the Equal Employment Opportunity Commission (EEOC),the term contingent worker includes a(n):
A) employee hired and trained directly by an employer.
B) permanent worker who works for only one employer at a time.
C) full-time worker.
D) independent contractor.
Answer: D
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Chapter 2: The Employment Law Toolkit: Resources for Understanding
the Law and Recurring Legal Concepts
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Q1) Hannah was fired by Friendly Catering Company (FCC)without a valid reason.The company's employee handbook stated that employees would only be terminated for good cause.Hannah's job position was later filled by her former supervisor's niece.In this scenario,Hannah cannot file a wrongful discharge lawsuit against FCC because she is an at-will employee.
A)True
B)False
Answer: False
Q2) Major Tire Inc.'s manufacturing plant in Charleston,South Carolina was destroyed when Hurricane Hazel hit the coast.The company officially closed the facility after reviewing the damage and terminated all 500 workers.The company did not give the employees 60 days' notice,and thus,it is liable under the Worker Adjustment and Retraining Notification Act.
A)True
B)False Answer: False
Q3) Whistle-blowing occurs when an employer reports an employee's wrongdoing.
A)True
B)False
Answer: False
Page 4
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Chapter 3: Title Vii of the Civil Rights Act of 1964
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Q1) Ivan studied voice,opera,and Jewish liturgical music at the Southern Baptist Theological Seminary.After he graduated,he applied for a job as a cantor to lead prayer services at the Nashville Downtown Synagogue.The synagogue refused to consider him for the job because he is not Jewish.If Ivan files an employment discrimination claim against the Nashville Downtown Synagogue,the synagogue can:
A) be held liable for discrimination under Title VII of the Civil Rights Act of 1964.
B) defend itself using the ministerial exception to Title VII of the Civil Rights Act of 1964.
C) be held liable for retaliation under Title VII of the Civil Rights Act of 1964.
D) assert the doctrine of promissory estoppel to protect itself against Ivan's claim.
Answer: B
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Chapter 4: Legal Construction of the Employment Environment
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Q1) While interviewing Zarah Qazi for the post of marketing manager,the Vice President of Glowing Hair Products Inc.asks Zarah about the origin of her first name,if she is married,and if she plans to have children in the near future.Which of the following holds true in this scenario?
A) These questions are prohibited by federal law because they concern national origin, ethnicity, and marital status.
B) These questions are not prohibited by federal law but they could be used as evidence of discrimination because they are not job related.
C) These questions are not prohibited by federal law but there is a risk of liability if all applicants are asked the same questions.
D) These questions are prohibited by federal law only when an employer is protected under the business necessity defense.
Q2) Under common law,employers can be found liable for fraud in recruitment if they:
A) offer all candidates the same information about a position or their company.
B) allow an applicant to believe something about a job that they know is false.
C) use word-of-mouth recruiting to obtain new employees.
D) fill a job position by promoting from within the company.
Q3) What is eligibility testing? Why are eligibility tests conducted?
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Chapter 5: Affirmative Action
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Q1) Affirmative action is used only when there is:
A) an undoubted reason to raise the bona fide occupational qualification defense.
B) a demonstrated underrepresentation of women and minorities in the workplace.
C) a need to improve workplace productivity and efficiency.
D) a need to punish someone for employment discrimination.
Q2) Executive Order 11246 requires all federal contractors:
A) with 15 or more employees and a nonconstruction contract of $10,000 or more to implement judicial affirmative action.
B) with 50 or more employees and a nonconstruction contract of $50,000 or more to develop a written affirmative action plan.
C) to draft an affirmative action plan regardless of the number of employees or the size of the contract.
D) to draft an affirmative action plan that prohibits them from terminating minorities and females based on their performance at their jobs.
Q3) Describe some actions an employer can take to make an effort to include those historically underrepresented in the workplace.
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Chapter 6: Race and Color Discrimination
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Q1) Brett,the manager at Warson's Diner,plans to promote Keisha,one of the waitresses,to the position of an assistant manager.However,the owner,being racially biased,prevents him from doing so.Later,when Brett wants to promote one of the delivery boys to waiter,the owner again vetoes his recommendation on the grounds that his customers would feel uncomfortable having a black man deliver their food.Brett,extremely frustrated,offers Keisha and the delivery boy their promotions as he finds them deserving.Subsequently,Brett gets fired.Which of the following holds true in this scenario?
A) Brett has a cause of action against Warson's Diner for retaliatory discharge under Title VII of the Civil Rights Act of 1964.
B) Brett has a cause of action against Warson's Diner based on the bona fide occupational qualification defense.
C) Brett is liable for racial discrimination because as a manager he failed to change the company's policy regarding promotion of African-Americans.
D) Brett is liable because he failed to follow the instructions provided by his employer.
Q2) Discuss national origin discrimination at the workplace.
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Chapter 7: National Origin Discrimination
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Q1) Under Title VII of the Civil Rights Act of 1964,the prohibition against national origin discrimination is subject to the political function exception,which allows:
A) only a naturalized U.S. citizen to run for president of the United States.
B) only private employers to discriminate against individuals based on their country of origin.
C) discrimination against a noncitizen when the position is intimately related to the process of self-government.
D) discrimination against individuals whose national origin is a country with which trade has been outlawed by an act of Congress.
Q2) An employee may have a national origin discrimination claim if the worker is simply perceived to be of a certain origin,even if the individual is not,in fact,of that origin.
A)True
B)False
Q3) "Not all harassment is prohibited under Title VII of the Civil Rights Act of 1964." Explain.
Q4) Distinguish between national origin and citizenship.
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Chapter 8: Gender Discrimination
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Q1) Parker owns a line of cosmetics and other grooming products called Bliss You.All the makeup artists working for Bliss You are required to wear black at work.Male employees must wear black pants and black T-shirts,and female employees must wear black skirts,black tops,and high-heeled shoes.Parker believes that sales will be better if female employees are dressed in a feminine way.Selena,an employee of Bliss You,is fired for wearing pants to work.If Selena files a gender discrimination lawsuit against Bliss You,she is most likely to win the case.
A)True
B)False
Q2) The 1991 Civil Rights Act created the Glass Ceiling Commission to:
A) eliminate discrimination based on a person's affinity orientation.
B) fix a cap on the compensation provided to top managers of publicly held companies.
C) investigate the barriers to female and minority advancement in the workplace.
D) protect transgender employees from discrimination in the workplace.
Q3) Comparable worth claims under Title VII of the Civil Rights Act of 1964 have generally been successful in the federal courts.
A)True
B)False
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Page 10
Chapter 9: Sexual Harassment
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Q1) Sexual harassment class action trials are rare mainly because:
A) the Equal Employment Opportunity Commission has limited power to enforce sexual harassment claims.
B) most cases are settled rather than litigated as a means of avoiding bad publicity and the possibility of even greater damages if the matter goes to trial.
C) claimants are not entitled to any compensatory damages on winning the claim.
D) the Civil Rights Act of 1991 is not clear about what constitutes sexual harassment and what does not.
Q2) Distinguish quid pro quo sexual harassment from hostile environment sexual harassment.
Q3) In a sexual harassment claim,it is a defense to liability if an employer can show that a harassee unreasonably failed to avail himself or herself of a mechanism the employer had in place for preventing or correcting sexual harassment.
A)True
B)False
Q4) What are the elements of hostile environment sexual harassment?
Q5) What is the Ellerth/Faragher affirmative defense,and what should an employer do to be able to assert the defense?
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Chapter 10: Sexual Orientation and Gender Identity
Discrimination
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Q1) Chan,an Asian employee working at Coral Systems Inc.,is terminated on the grounds that he is homosexual.He wants to file a discrimination claim against his employer.Chan will have a valid claim under Title VII of the Civil Rights Act of 1964 if he can show that:
A) he was discriminated solely based on his sexual orientation.
B) he and his partner are married per the Defense of Marriage Act.
C) his employer did not terminate homosexual employees from other races.
D) his employer treated heterosexuals differently.
Q2) Research shows that in states with laws prohibiting discrimination against gays and lesbians,the laws had:
A) not generated a significant amount of litigation.
B) increased the number of discrimination claims by 20 percent.
C) not been effective in reducing discrimination based on sexual orientation.
D) decreased the number of homosexuals hired by employers.
Q3) The term transgender includes those who may not yet have undergone gender reassignment surgery but are living as the opposite gender.
A)True
B)False
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Page 12
Chapter 11: Religious Discrimination
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Sample Questions
Q1) LaTonya joins the Freewill Church,and as a member,she is not allowed to wear pants.Her employer,Salo's Seafood,requires all employees to wear coveralls provided by the company for safety reasons.Although LaTonya wore the uniform prior to joining the church,she now refuses to wear the coverall.She explains to Sal,the owner of the restaurant,that wearing pants is against her beliefs.Sal makes an exception in her case and allows her to wear knee-length boots with a protective jacket,but LaTonya refuses to wear the boots.Sal fires her for insubordination.Which of the following holds true in this case?
A) Sal is liable for religious discrimination for failing to provide an accommodation that LaTonya would accept.
B) Sal is liable for religious discrimination for failing to provide a reasonable alternative.
C) Sal is not liable for religious discrimination because LaTonya's religious practice is not followed by any other employee at the company.
D) Sal is not liable for religious discrimination because he made an effort to reasonably accommodate LaTonya's religious practice.
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Page 13
Chapter 12: Age Discrimination
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Q1) The Hazen Paper Co.v.Biggins case is an important one in the area of reductions in force since the Supreme Court held that there is no disparate treatment under the Age Discrimination in Employment Act when the factor motivating an employer is some feature "other than an employee's age."
A)True
B)False
Q2) When a claim is pretextual,it means that it is the true reason for an action,that there is no underlying motivation.
A)True
B)False
Q3) The Age Discrimination in Employment Act does not allow the defense of bona fide occupational qualification to be used by employers.
A)True
B)False
Q4) In almost half the states.state employees are not able to sue their state employers under the ADEA.
A)True
B)False
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Page 14
Chapter 13: Disability Discrimination
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Q1) Under the Americans with Disabilities Act (ADA),employers are permitted to:
A) accommodate disabled employees by eliminating an essential function of a job or lowering a production standard that applies to all employees if they want to.
B) provide employees with disabilities more rights to their jobs than those provided to nondisabled employees.
C) impose standards or criteria that discriminate against or screen out employees or applicants on the basis of their disability.
D) make presumptions about what a class of disabled individuals may or may not be able to do.
Q2) A person who is substantially limited in performing the unique aspects of a single,specific job will be deemed substantially limited in the major life activity of working.
A)True
B)False
Q3) Current illicit drug users are protected by the Americans with Disabilities Act (ADA).
A)True
B)False
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Chapter 14: The Employees Right to Privacy and Management of Personal Information
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Q1) Provide a justification for electronic surveillance conducted by employers.
Q2) Andrew works for the Department of Health and Human Services in the accounting department.David,the head of the department,storms into Andrew's office demanding to search the files and all records of payments made by the department to BT Holland Construction Corp.Andrew attempts to leave the office during the search,but David blocks the way and asks him to stay until the review of all the files is complete.Which of the following statements is most likely to be true in this scenario?
A)Andrew's rights have been violated because the search was per se unreasonable under the Fourth Amendment.
B)Andrew has a claim for defamation.
C)Andrew has a claim for false imprisonment.
D)Andrew has no recourse because the search was justified by a legitimate business reason.
Q3) The Privacy Act of 1974,originally enacted to apply only to government employees,was extended to cover private sector employees in 1977.
A)True
B)False
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Page 16
Chapter 15: Labor Law
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Q1) U.S.postal employees are generally allowed to bargain over wages,hours,or benefits.
A)True
B)False
Q2) A management security clause gives an employer the right to:
A) refuse to sign a written agreement to which the contracting parties orally agreed.
B) require employees to sign an agreement stating that they do not belong to a union and will not join one.
C) run the business and make appropriate business decisions as long as management complies with applicable laws and agreements.
D) require the union to represent all employees fairly and without discrimination based on union membership.
Q3) The _____ was enacted in response to congressional investigations into union corruption from 1957 to 1959.
A) Wagner Act
B) Norris-LaGuardia Act
C) Landrum-Griffin Act
D) Taft-Hartley Act
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Chapter 16: Selected Employment Benefits and Protections
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Q1) Salim has been an employee of Firewood Heavy Equipment for the past seven months.His wife was recently diagnosed with cancer and needs to undergo surgery.Salim asks his supervisor,Harris,for four to six weeks of leave pursuant to the Family Medical Leave Act of 1993 (FMLA)for his wife's surgery and rehabilitation.Which of the following holds true in this case?
A) Harris is not required to grant the leave under the FMLA because the act is limited to employees at the executive level.
B) Harris is not required to grant the leave under the FMLA because Salim has worked for Firewood Heavy Equipment for less than 12 months.
C) Harris is required to grant the leave under the FMLA because Salim belongs to a protected class.
D) Harris is required to grant the leave under the FMLA because the condition of Salim's wife is severe.
Q2) Payroll practices from an employer's general assets are welfare benefit plans covered by the Employee Retirement Income Security Act (ERISA).
A)True
B)False
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Page 18