BUSA2106 Lecture 22 Outline of Last Lecture I II Agency relationships Agency liability for contracts and torts Outline of Current Lecture I II Employee versus independent contractor relationship Employment at will Current Lecture Employment law Agency law employment law Employer employee relationship is one kind of agency relationship Distinguished from independent contractor relationship Employment law is the body of federal and state law that governs the employer employee relationship Who is an employee Employee versus independent contractor How much control does the employer have over the worker Does the worker have more than one employer Is the worker s occupation different from that of the employer Is the work done under the employer s direct supervision What is the method of payment How much skill is required of the worker Factors courts do not consider Job title what label the employer uses internally How the employer classifies the worker in reporting to the IRS Why does it matter Many laws only apply to employees Example FedEx Ground drivers were classified by the company as independent contractors Sued FedEx claiming that they were actually employees and that FedEx therefore owed them back overtime under the Fair Labor Standards Act Drivers work was wholly integrated into FedEx s operations Paid weekly wages just like FedEx employees Receive benefits from FedEx Schedules routes and hours dictated by FedEx Color of drivers socks and the length of their hair dictated by FedEx Employment at will Which employees are subject to EAW doctrine Rule Either party may terminate the employment relationship at any time for any reason Rationale Rule presumes equality of bargaining power between workers and employers Questions to ponder Do employers and workers have equal bargaining power in determining the terms of their employment relationship How does EAW benefit employers Workers Are employers likely to discharge at will workers for irrational or inappropriate reasons What role does the economy play When are workers likely to challenge an at will discharge
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