BUL 3320 – LAW AND BUSINESS –
WELKER QUESTIONS WITH
REVISED ANSWERS
Workers Compensation/Third parties - Answer-most cases, employees injured by
independent third parties can file workers' compensation claims through their
employers' insurance companies AND separate third-party negligence claims against
those who inflicted the injuries.
If the employee receives an award from the third-party claim, most state laws require
him to reimburse the workers' comp benefits. The employee keeps the remaining
amount, such as awards for pain and suffering or punitive damages that are not covered
by worker's comp.
Example: Delivery Man Hit by Drunk Driver
A delivery man on his work route is struck by a drunk driver and seriously injuried. The
delivery man is entitled to collect workers' compensation benefits and pursue a personal
injury claim against the drunk driver and his insurance company.
The delivery man's workers' comp insurance covers only medical benefits and partial
wage reimbursement. The third-party personal injury award includes medical bills, out-
of-pocket expenses, full lost wages, and compensation for the his pain and suffering.
After reimbursing workers' comp the amount he received for medical expenses and a
percentage of his wages, the delivery man keeps the remaining amount.
Landrum Griffin Act - Answer-The Labor-Management Reporting and Disclosure Act
(LMRDA) — also known as the Landrum-Griffin Act — deals with the relationship
between a union and its members. The LMRDA grants certain rights to union members
and protects their interests by promoting democratic procedures within labor
organizations. The Act establishes a Bill of Rights for union members; reporting
requirements for labor organizations, union officers and employees, employers, labor-
relations consultants, and surety companies; standards for the regular election of union
officers; and safeguards for protecting labor organization funds and assets.
Right to Work Law - Answer-"Right-to-work" laws are statutes in a number of states in
the United States that prohibit union security agreements, or agreements between labor
unions and employers, that govern the extent to which an established union can require
employees' membership, payment of union dues, or fees as a condition of employment,
either before or after hiring. Right-to-work laws do not aim to provide general guarantee
of employment to people seeking work, but rather are a government regulation of the
contractual agreements between employers and labor unions that prevents them from
,excluding non-union workers,[1] or requiring employees to pay a fee to unions that have
negotiated the labor contract all the employees work under.
Closed Shop Agreement - Answer-In a closed shop agreement, the employer agrees
that he will only hire employees who are members of the union. If an employee ever
leaves the union, the employer must fire the employee. Closed shop agreements are
prohibited by national law (called the Taft-Hartley Act) in the United States. A shop in
which persons are required to join a particular union as a precondition to employment
and to remain union members for the duration of their employment.
Union Shop Agreement - Answer-Union shop agreements allow an employer to hire
non-union members but require the employee to join the union within a certain amount
of time (usually after 30 days). In practice though, employers are not allowed to fire
employees who refuse to join the union, provided the employees pay dues and fees to
the union.
Agency Shop Agreement - Answer-Agency shop agreements require employees who
do not join the union to pay dues and fees.
Worked Adjustment and Retraining Act (WARN) - Answer-WARN offers protection to
workers, their families and communities by requiring employers to provide notice 60
days in advance of covered plant closings and covered mass layoffs. This notice must
be provided to either affected workers or their representatives (e.g., a labor union); to
the State dislocated worker unit; and to the appropriate unit of local government.
Employer Coverage
In general, employers are covered by WARN if they have 100 or more employees, not
counting employees who have worked less than 6 months in the last 12 months and not
counting employees who work an average of less than 20 hours a week. Private, for-
profit employers and private, nonprofit employers are covered, as are public and quasi-
public entities which operate in a commercial context and are separately organized from
the regular government. Regular Federal, State, and local government entities which
provide public services are not covered.
Employee Coverage
Employees entitled to notice under WARN include hourly and salaried workers, as well
as managerial and supervisory employees. Business partners are not entitled to notice.
Employee Lockouts - Answer-A lockout is a temporary work stoppage or denial of
employment initiated by the management of a company during a labor dispute.[1] This
is different from a strike, in which employees refuse to work. It is usually implemented
by simply refusing to admit employees onto company premises, and may include
actions such as changing locks and hiring security guards for the premises. Other
, implementations include a fine for showing up, or a simple refusal of clocking-in on the
time clock. It is therefore referred to as the antithesis of strike.[2]
Specific Performance (3 q's) - Answer-A remedy that orders the breaching party to
perform the acts promised in the contract. Specific performance is usually awarded in
cases in which the subject matter is unique, such as in contracts involving land,
heirlooms, and paintings.
Specific Performance (3 q's) - Answer-On September 1, Won-Suk enters into a contract
to purchase a house from Geraldine fro $1 million. The closing date is set for November
1. On November 1, Won-Suk brings the money to the closing but Geraldine does not
appear at the closing and thereafter refuses to sell the house to Won-Suk. In this case,
because each piece of real estate is considered unique, Won-Suk can bring an action of
specific performance against Gerldine and obtain a court judgement ordering Geraldine
to sell the house to Won-Suk.
Specific Performance (3 q's) - Answer-"Specific performance" is a specialized remedy
used by courts when no other remedy (such as money) will adequately compensate the
other party. If a legal remedy will put the injured party in the position he or she would
have enjoyed had the contract been fully performed, then the court will use that option
instead. The most common reason courts grant specific performance is that the subject
of the contract is unique. When a contract is for the sale of a unique property, mere
money damages will not remedy the purchaser's situation.
Example: Rina offers to buy Beth's house and Beth accepts, but later decides to keep
the property. Real estate is considered to be unique. Since there is no other piece of
property or house exactly like Beth's, Rina may be entitled to specific performance on
the contract. Beth would be compelled to go through with the sale.
Mitigation of Damages - Answer-A non-breaching party's legal duty to avoid or reduce
damages caused by a breach of contract.
Liquidates Damages ( 2 q's) - Answer-Damages that parties to a contract agree in
advance should be paid if the contract is breached
Liquidates Damages ( 2 q's) - Answer-Alaska Oil Company discovers a new rich oil field
in the northern-most part of Alaska. Alaska Oil contracts to purchase special oil drilling
equipment from Tundra Equipment corporation that is necessary to drill holes in the
hard ground in the Alaska tundra. The contracts states that the equipment is to be
delivered by July 1, 2014. The parties know that Alaska Oil cannot start digging the oil
holes until it recieves this equipment. It is uncertain how great the oil flow will be from
the drilled oil holes... Thus, if Tundra equipment does not delever the equipment until
July 1, 2012, it owes Alaska oil $7,300,000 (365 days x $20,000 per day)
