Legal Environment of Business Exam Bank
Course Introduction
The Legal Environment of Business provides students with an understanding of the fundamental legal principles that impact the world of commerce. This course examines the structure and sources of law, the court system, dispute resolution, and the regulatory environment in which businesses operate. Topics include contracts, torts, agency, employment law, intellectual property, and government regulation. Students will explore how laws shape business decision-making and operations while gaining awareness of ethical considerations and the role of law in promoting fairness and accountability in the marketplace.
Recommended Textbook
Employment and Labor Law 9th Edition by
Patrick J. Cihon
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22 Chapters
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Page 2
Chapter 1: First the Forest, Then the Trees:an Overview of Employment and Labor Law
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Q1) The Merchant Marine (Jones) Act (1936):
A) provides remedies for injured sailors.
B) provides modest pensions to retired workers.
C) sets the terms and conditions of employment to be provided by government contractors.
D) sets minimum wages, mandates overtime pay, and regulates child labor.
Answer: A
Q2) Explain the consequences of the New Deal that was created subsequent to the Great Depression.
Answer: The Great Depression and the subsequent New Deal of President Franklin D.Roosevelt resulted in the enactment of the major federal employment and labor laws.These statutes include: The Social Security Act (1935) The National Labor Relations Act (1935) The Walsh-Healy Act (1936) The Merchant Marine (Jones) Act (1936) The Fair Labor Standards Act (1938)?These laws continue to govern the fundamental features of the employment relationship and unionization even today
Q3) What does the Racketeer Influenced and Corrupt Organizations Act (RICO) state?
Answer: RICO is a federal law designed to criminally penalize those who engage in illegal activities as part of an ongoing criminal organization.Essay
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Chapter 2: Employment Contracts and Wrongful Discharge
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Q1) Pennsylvania Human Relations Act provides that a person fired on the basis of gender or race discretion has to initially seek redress from the commission created under the Act and not with the court.
A)True
B)False
Answer: True
Q2) Watson, a Director of a telecom company in Florida, entered into a written contract with Carter Telecon.The contract outlined the services his company would provide in exchange for a fixed monthly rate.This is an example of:
A) an implied contract.
B) an express contract.
C) a specification of contract.
D) a breach of contract.
Answer: B
Q3) Public Policy Exception is not a commonly adopted exception to the pure employment-at-will rule.
A)True
B)False
Answer: False
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Page 4
Chapter 3: Commonly Committed Workplace Torts
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Q1) How does the court recognize qualified privilege?
Answer: The law generally recognizes a qualified privilege where one person communicates with another who has a legitimate need to know the information.
Q2) If a state recognizes tort of negligent infliction of emotional distress, how will the defendant of that state be liable for damages?
Answer: A defendant may be liable in damages for unreasonable behavior that results in severe emotional harm to the plaintiff, even though the defendant never meant to inflict any harm.
Q3) How can a person be immune from a defamation suit if he is protected by qualified privilege?
Answer: If a person is protected by qualified privilege his remarks will be immune from defamation suit, provided he made them in good faith.
Q4) Since business defamation is a per se tort, it cannot amount to strict liability even if the plaintiff has proved that the damaging statement was published.
A)True
B)False
Answer: False
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Chapter 4: Employee Privacy Rights in the 21st Century
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Q1) Identify the entities covered under HIPPA.
Q2) Increases in incidents of workplace violence and concomitant increases in ______ lawsuits, by customers and co-workers of violent employees, have added urgency to the effort of checking employees' background.
A) malice
B) academic freedom
C) negligent hiring
D) substance abuse
Q3) In Koeppel v.Speirs, an electronic invasion occurs under the intrusion on solitude or seclusion component of the tort of:
A) liability.
B) defamation.
C) libel.
D) invasion of privacy.
Q4) The most common way employers invade their employees' privacy is to:
A) intrude on their seclusion, solitude or private affairs.
B) probe into their personal lives and medical history.
C) monitor their relationships with individuals at the workplace.
D) request for irrelevant information and past records.
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Chapter 5: The Global Perspective:international
Employment Law and American Immigration Policy
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Q1) The Union Network International has laid special emphasis to build more effective alliances in multinationals.
A)True
B)False
Q2) UNI claims to hold the allegiance of approximately 15 million workers in 900 unions in 150 countries, representing employees in the following economic sectors EXCEPT:
A) medicine.
B) commerce.
C) electricity.
D) hair and beauty.
Q3) Employer compliance with IRCA includes that employers must verify the employment eligibility of any employee hired.
A)True
B)False
Q4) What are the components of Global Unions?
Q5) What is the Union Network International (UNI)?
Q6) What are conventions?
Q8) What is the role of U..Citizenship and Immigration Services (USCIS)? Page 7
Q7) What is the purpose of the Immigration Reform and Control Act (IRCA) of 1986?
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Page 8
Chapter 6: Title VII of the Civil Rights Act and Race Discrimination
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Q1) Criterion-related validity is a method of demonstrating that an employment selection device reflects the content of a job for which employees are being selected.
A)True
B)False
Q2) Content validity is a means of isolating and testing for specific traits or characteristics that are deemed essential for job performance.
A)True
B)False
Q3) Title VII is administered by:
A) the Equal Employment Opportunity Commission.
B) the Supreme Court.
C) the Department of Labor.
D) None of these answers.
Q4) The Four-Fifths Rule, is a mathematical formula developed by the EEOC to demonstrate disparate impact of a facially neutral employment practice on selection criteria.
A)True
B)False
Page 9
Q5) What is bona fide occupational qualification?
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Chapter 7: Gender and Family Issues:title VII and Other Legislation
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Q1) What is the provision under Title VII with respect to gender discrimination? Explain "gender-plus" discrimination.
Q2) In which of the following cases did the court hold that abuse and ridicule by coworkers and managers directed at a male employee because he appeared effeminate and did not conform to a male stereotype was discrimination "because of sex" for the purposes of establishing a claim under Title VII?
A) Price Waterhouse v.Hopkins.
B) Willingham v.Macon Tel.Publishing Co.
C) Baker v.California Land Title Co.
D) Nichols v.Azteca Restaurant Entreprises, Inc.
Q3) In Smith v.City of Salem, Ohio, Greenamyer suspended Smith for one twenty-four hour shift, based on his alleged infraction of a City and/or Fire Department policy.Smith filed suit in the federal district court alleging:
A) pay discrimination in violation of Title VII.
B) sex discrimination and retaliation in violation of Title VII.
C) violation of National Relation Board by Greenamyer.
D) violation of Title VII by discriminating her on the basis of religion.
Q4) When should an employee give notice for leave under FMLA?
Q5) Explain the coverage of the Equal Pay Act.
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Chapter 8: Discrimination Based on Religion and National
Origin and Procedures Under Title VII
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Q1) An employee is given 160 days to file complaint with the EEOC under the Lilly Ledbetter Fair Pay Act.
A)True
B)False
Q2) Title VII of the Civil Rights Act of 1964 prohibits employment discrimination on the basis of religion.
A)True
B)False
Q3) The court may award "reasonable attorney's fees":
A) with a notice from the chief justice of the Supreme court.
B) at its discretion.
C) upon the order of the federal government.
D) only when the plaintiff's case was not frivolous, unreasonable, vexatious, or meritless.
Q4) Discuss the enforcement of Title VII.
Q5) The rules of procedure for the federal courts allow an individual plaintiff to sue on behalf of a whole class of individuals allegedly suffering the same harm.
A)True
B)False
11
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Chapter 9: Discrimination Based on Age
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Q1) Retirement ages for firefighters and law enforcement officers are set by local and state government under Section 623(j) of the Age Discrimination in Employment Act (ADEA).
A)True
B)False
Q2) What are the procedures to file complaint for alleged violation under Age Discrimination in Employment Act?
Q3) The Age Discrimination in Employment Act provides for suits by the responsible government agency against non federal employees.In this instance:
A) the EEOC must attempt to settle the complaint voluntarily before filing suit.
B) the time limitation for the required conciliation effort is sixty days.
C) the 1991 amendments to the ADEA enforced the previous time limits spelled out for suits by the EEOC.
D) at present, the courts are split on the question of when the EEOC suit must be filed.
Q4) When is arbitration for ADEA claims enforced?
Q5) How is the Age Discrimination in Employment Act enforced and administered?
Q6) What is meant by "age discrimination in employment" and under which act is it prohibited?
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Chapter 10: Discrimination Based on Disability
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Q1) Wills appeared for a written examination for a job in the Department of Health in Federal Government.He was selected for the particular job, but the head of the department disqualified him on the ground of disability.In this case, 501 of the Rehabilitation Act, prohibits discrimination on the basis of disability by the:
A) jury.
B) state executive.
C) federal executive.
D) state legislature.
Q2) What is the consequence for failure to make reasonable accommodation?
Q3) What is the constitutional validity of drug testing by public sector employment?
Q4) How do state laws handle discrimination with respect to disabilities?
Q5) In which of the following cases did the Supreme Court uphold the constitutionality of Federal Railroad Administration regulations that required drug tests of all railroad employees involved in accidents, regardless of whether there was any reason to suspect individual employees of drug use?
A) Raytheon Co.v.Hernandez
B) Skinner v.Railway Labor Executives' Association
C) New York City Transit Authority v.Beazer
D) Vande Zande v.State of Wisconsin Dept.
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Chapter 11: Other EEO and Employment Legislation:federal and
State Laws
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Q1) Employers from discriminating against employees because of their legal off-duty recreational or political activities are prohibited under _____ of the New York State Labor Law.
A) Section 201-a
B) Section 201-d
C) Section 205-d
D) Section 203-b
Q2) Which one of the following options is responsible for investigating and pursuing claims of whistleblowers?
A) Equal Employment Opportunity Commission
B) National Labor Relations Board
C) The federal Office of Special Counsel
D) International Labor Organization
Q3) The federal Employee Polygraph Protection Act of 1988 prohibits honesty testing.
A)True
B)False
Q4) Briefly explain the Uniformed Services Employment and Reemployment Rights Act.
Q5) What are the requirements of strict scrutiny test?
Q7) Define honesty tests. Page 14
Q6) What is the role of federal Employee Polygraph Protection Act of 1988?
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Page 15
Chapter 12: The Rise of Organized Labor and Its Regulatory Framework
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Q1) Yellow-dog contracts require employees to sign a contract with the employer, where the employees agree not to:
A) revolt against the employer.
B) join any union.
C) challenge management decisions legally.
D) divulge confidential information.
Q2) In Duplex Printing Press Company v.Deering, Duplex responded to the national boycott called by the Machinists' Union by filing suit for an injunction under the: A) Sherman Act.
B) National Labor Relations Act.
C) Clayton Act
D) Norris-La Guardia Act.
Q3) The National Industrial Recovery Act, the centerpiece of Franklin Roosevelt's New Deal, provided protection for employees organizing unions and encouraged collective bargaining.
A)True
B)False
Q4) What is the extent of jurisdiction of the NLRB?
Q5) Discuss the Congress of Industrial Organizations.
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Chapter 13: The Unionization Process
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Q1) Under the contract bar rule, an employer filing a petition must submit a proof of union's recognition demand within two days of filing the petition to the regional office.
A)True
B)False
Q2) In _____, the court held that the NLRB will intervene if either party uses a forged document that renders the voting employees unable to recognize the propaganda for what it is.
A) NLRB v.St.Francis Healthcare Center
B) Bro-Tech Corp.v.NLRB
C) Packard Motor Car v.NLRB
D) American Hospital Association v.NLRB
Q3) Explain the second exception under contract bar rule.
Q4) As the NLRB agent supervises the conduct of the election, no parties are entitled to have observers present during the voting.
A)True
B)False
Q5) Define voluntary recognition.
Q6) Explain the two exceptions of contract bar rule.
Q7) What is the significance of Section 9(e)(1) of the NLRA pertaining to election?
Page 17
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Chapter 14: Unfair Labor Practices by Employers and Unions
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Q1) Section 8(a)(1) and Section 8(b)(1) of NLRB, prohibits:
A) union organizing campaigns.
B) strikes by employees.
C) coercion and restraint of employees.
D) poll conducted by employers.
Q2) Which guidelines should be followed when employer conducts a poll of his employees?
Q3) Robert joined as a trainee manager in Lite Apparels, which is the biggest garment factory in California.As soon as he joined, the company's union asked him to sign a union security agreement.According to the agreement, he had to pay membership fee of $500.The union's demands seem to be a violation of:
A) Section 8(b)(1)(A).
B) Section 8(b)(6).
C) Section 8(b)(5).
D) Section 10(l).
Q4) Section 8(a)(3) and Section 8(b)(2) prohibit discrimination to encourage or discourage union membership.
A)True
B)False
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Chapter 15: Collective Bargaining
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Q1) The Worker Adjustment and Retraining Notification (WARN) permits the creation of a separate enforcement agency and gives enforcement authority to the Department of Labor.
A)True
B)False
Q2) The collective agreements covering professional baseball and football players are examples of agreements that:
A) amount to yellow dog contracts.
B) permit individual negotiation.
C) are ex parte agreements.
D) require an inspection officer.
Q3) The employer need not give written notice of the closing or mass layoff to the employees (or their representative), the state economic development officials, or the chief elected local government official.
A)True
B)False
Q4) According to NLRB guidelines, what is the tenure of the bargaining agreement for a certified union?
Q5) When can an employer act unilaterally?
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Chapter 16: Picketing and Strikes
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Q1) The General Electric case made the nature of the work performed by the secondary employees at the primary site the key to whether the union may target secondary employees with:
A) strike.
B) picketing.
C) legal action.
D) violence.
Q2) A union that unilaterally delays the start of a strike beyond the time specified in the written notice violates _____ of the NLRA.
A) Section 9(a)
B) Section 8(a)(1)
C) Section 8(g)
D) Section 8(a)(5)
Q3) The National Labor Relations Act allows the NLRB to seek injunctions in federal courts when a complaint alleges violations of:
A) Section 8(b)(4)
B) Section 8(b)(7)
C) Section 8(e)
D) Section 8(g)
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Page 20
Chapter 17: The Enforcement and Administration of the Collective Agreement
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Q1) Discuss the applicability of interest arbitration.
Q2) California law requires that employers pay discharged employees all wages owed to them immediately at the time of the discharge.
A)True
B)False
Q3) In Fall River Dyeing & Finishing Corp.V.NLRB, the union requested the petitioner to recognize it as the bargaining agent for petitioner's employees and to begin collective bargaining.The petitioner refused the request, stating that, in its view, the request had "no legal basis. The union filed an unfair labor practice charge with the Board, alleging that in its refusal to bargain, the petitioner had violated Section 8(a)(1) and (5) of the:
A) Discrimination in Employment Act.
B) Occupational Safety and Health Act.
C) National Labor Relation Act.
D) Equal Employment Opportunity Act.
Q4) An implied no-strike clause does not cover any dispute that is subject to arbitration under the agreement.
A)True
B)False
Page 21
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Chapter 18: The Rights of Union Members
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Q1) Section 304 of the Taft-Hartley Act, along with related federal laws, controls:
A) employers' discretionary powers.
B) government action.
C) union political contributions.
D) unfair labor practices.
Q2) _____ of the Labor Management Reporting and Disclosure Act, guarantees the right of union members to participate in all membership business.
A) Section 301(a)
B) Section 101(a)(2)
C) Section 101(a)(1)
D) Section 10(a)(5)
Q3) The duty of fair representation is a judicially created obligation on the part of the union to represent fairly all employees in the:
A) arbitral tribunal.
B) illegal strike.
C) legal proceeding.
D) bargaining unit.
Q4) What are the rights guaranteed under Section 101(a)(1) of the Labor Management Reporting and Disclosure Act?
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Chapter 19: Public Sector Labor Relations
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Q1) Nearly 30 percent of the bargaining unit members at Specialty Mills Company no longer wish to be represented by their exclusive representative union.When such a petition is filed, the representation question will be investigated by the:
A) International Labor Union.
B) National Labor Relations Board.
C) Federal Labor Relations Authority.
D) Equal Employment Opportunity Commission.
Q2) Informational picketing that does not interfere with agency operations is not allowed.
A)True
B)False
Q3) Which of the following is not a significant difference in labor relations in private and public sector employers?
A) Limits of constitutional provisions
B) Right to strike
C) Sovereignty
D) Appointment of bargaining unit
Q4) What is the duty of the Merit System Protection Board (MSPB)?
Q5) Briefly explain the role of the Federal Service Labor-Management Relations Act.
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Chapter 20: Occupational Safety and Health
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Q1) Under which law can illegal immigrant workers challenge the employer if the wage paid to them is lower than the minimum wage?
Q2) Obama's first budget was released in late February 2009, and passed in early April 2009, which increased funding to the Occupational Safety and Health Administration (OSHA).
A)True
B)False
Q3) In Chao v.Gunite Corp. citations were issued for violations of:
A) the Fair Labor Standards Act.
B) the Americans with Disabilities Act.
C) occupational safety and health regulations.
D) None of these answers.
Q4) The National Institute of Occupational Safety and Health (NIOSH) is an agency created to cater to:
A) employers' needs.
B) dispute settlement.
C) research.
D) corporate investigations.
Q5) What is the National Institute of Occupational Safety and Health?
Q6) Name the two kinds of variances under OSHA.
Page 24
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Q1) Explain the concept of litigating unemployment claims.
Q2) Explain the concept of a fiduciary.
Q3) Explain the role of the Employee Retirement Income Security Act (ERISA).
Q4) When are workers' compensation benefits awarded?
Q5) In the case of a railroad worker accident brought to court in the 1900s, one of the defenses the railroad company used against the plaintiff was the "fellow-servant" doctrine.What does this refer to?
A) The claims for such incidents are usually settled out-of-court, as between fellows.
B) The company is not a separate entity above the employee, but a colleague and a caretaker.
C) The injured employee had assumed responsibility of the risks involved.
D) The accident is attributed to the negligence of the co-worker.
Q6) What is the main purpose of Social Security?
Q7) The Federal Employment Liability Act is a federal law designed to protect and compensate the injured:
A) disabled workers.
B) railroad workers.
C) war veterans. Page 25
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Chapter 22: The Fair Labor Standards Act
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Q1) Explain the term "workweek".
Q2) Which of the following is an example of an employee exempt from overtime or minimum wages under the FLSA?
A) Senior Manager, Human Resources
B) Operations Executive, Factory Floor
C) Machine Operator, Drilling Division
D) Creative Artist, Web Media Division
Q3) Discuss the provisions regarding child labor under the Fair Labor Standards Act.
Q4) Congress enacted the FLSA in:
A) 1940.
B) 1938.
C) 1951.
D) None of these answers.
Q5) Machinists and sewing machine operators are usually paid on a(n):
A) hourly basis.
B) piece-rate basis.
C) monthly basis.
D) lump sum basis.
Q6) Which are the categories of child labor exempted from the category of oppressive child labor under the Fair Labor Standards Act?
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