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BUSI 3705U (10)
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Chapter 20

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BUSI 3705U

Chapter 20 Legal Environment of Business The Employment Relationship The Employment Relationship - Contractual relationship whereby an employer provides remuneration to an employee in exchange for work or services - Independent contractor → person who is in a working relationship that does not meet the criteria of employment - Usually doctors and lawyers provide services in the capacity of independent contractor Employee VS independent Contractor - Based on various Test: o Degree of control exercised over the individual by the employer- more direction and supervision provided by employer, more likely the relationship is employment o Ownership of tools, chance of profit, and the risk of loss from performance of the requested service o Degree of integration of the work into the company’s activities Implications of an Employment Relationship - Employee has certain statutory rights and benefits such as paid holidays and overtime - Employee may sue for wrongful dismissal, but this avenue is not available to an independent contractor - Employer is responsible for the torts of an employee in the course of employment, but not for those of an independent contractor in the course of carrying out the contract Risk in Hiring - critical to business success or failure - Vicarious liability – employer is liable when an employee commits a wrong while carrying out assigned duties or authorized tasks. - Negligent hiring – if the employer is careless in hiring, training, or supervising there may be an action against the employer in negligence due to the actions of employee Hiring Process - Steps in Hiring Process o Develop job descriptions o Advertise the positions o Have candidates complete an application form or submit a résumé o Short-list candidates o Check backgrounds or references o Interview selected applicants - Human rights legislation prohibits discrimination in hiring on certain grounds o Marital status o Race o Colour o Physical or mental disability o Religion or creed o Sex o Age Discrimination - Treating someone differently on the basis of a prohibited ground - Adverse effects discrimination – discrimination that occurs as a result of a rule that appears neutral but in its effects is discriminatory - Systemic discrimination – discrimination that results from the combined effects of many rules, practices, and policies - Defenses to Discrimination Chapter 20 Legal Environment of Business The Employment Relationship o Bona fide occupational requirement (BFOR)  a defense that excuses discrimination on a prohibited ground when it is done in good faith and for a legitimate business reason o Duty to accommodate  the duty of an employer to modify work rules, practices, and requirements to meet the needs of individuals who would otherwise be subjected to unlawful discrimination - Penalties o Failure to avoid or eliminate discriminatory practices can result in a complaint to the Human Rights Commission o Board of inquiry investigates the complaint o If complaint is valid, it can order the employer to stop its practices, hire a particular individual, pay monetary compensation, write a letter or apology, reinstate employee or institute an affirmative action plan - Avoiding Discrimination In Hiring o Job description o Advertisements o Application forms o Interviews Employment Equity Legislation - Laws designed to improve the status of certain designated groups - requires employers to take positive steps to make the workplace more equitable - Employment Equity Act targets the under-representation of women, Aboriginal peoples, people with disabilities, and visible minorities in the workforce Formation of Employment Contract → Offer of Employment - Must be reasonably certain to constitute an ‘offer’ in law - Need not be in a particular form or in writing - Once made, the offer is capable of acceptance until it is terminated The Employment Contract - Considerations prior to making the offer o Employer should determine whether the candidate has any obligations to his/her most recent employer o Could result in legal action against the new employer for:  Inducing breach of contract  Restrictive covenants  Fiduciary obligations - Fixed or Definite Term Contract → A contract for a specified period of time, which automatically ends on the expiry date - Indefinite-Term Contract → A contract for
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