TEST BANK
Employment Law for Business, 10th Edition,
Dawn Bennett-Alexander, Chapters 1 - 16
,TABLE OF CONTENTS
Chapter 1 The Regulation of Employment
Chapter 2 The Employment Law Toolkit: Resources for Understanding the
Law and Recurring Legal Concepts
Chapter 3 Title VII of the Civil Rights Act of 1964
Chapter 4 Legal Construction of the Employment Environment
Chapter 5 Affirmative Action
Chapter 6 Race and Color Discrimination
Chapter 7 National Origin Discrimination
Chapter 8 Gender Discrimination
Chapter 9 Sexual Harassment
Chapter 10 Sexual Orientation and Gender Identity Discrimination
Chapter 11 Religious Discrimination
Chapter 12 Age Discrimination
Chapter 13 Disability Discrimination
Chapter 14 The Employee’s Right to Privacy and Management of Personal
Information
Chapter 15 Labor Law 857
Chapter 16 Selected Employment Benefits and Protections
,Chapter 01: The Regulation of Employment
Answers are at the End of Each Chapter
Student name:
TRUE/FALSE - Write 'T' if the statement is true and 'F' if the statement is false.
1) Agency law, based on the traditional law called master and servant, governs
employment relationships.
⊚ true
⊚ false
2) In an employment-agency relationship, if an agent acts beyond his or her authority,
the principal may be liable for any resulting loss to a third party.
⊚ true
⊚ false
3) Myra provides accounting services as an independent contractor for Great
Northern. Because of this relationship, Great Northern is responsible for withholding and
paying Myra's employment taxes, including federal unemployment compensation (FUTA),
Social Security (FICA) and FICA excise tax.
⊚ true
⊚ false
4) Employers are not liable for most torts committed by an independent contractor
within the scope of the working relationship.
⊚ true
⊚ false
5) There is a single commonly accepted definition of "employee" used by courts,
employers, and the government.
, ⊚ true
⊚ false
6) Fresh Ideas employs part-time workers through a staffing firm. After the staffing
firm sent over a part-time office assistant, Fresh Ideas asked the firm to replace her with
someone from a different race. The replaced office assistant cannot proceed with a
discrimination claim under Title VII of the Civil Rights Act since she (the part-time office
assistant) was never an employee of Fresh Ideas.
⊚ true
⊚ false
MULTIPLE CHOICE - Choose the one alternative that best completes the statement or
answers the question.
7) If an employee has a car accident while driving a company car from one company
office to another, the employer may be liable to the owner of the other vehicle under which
legal theory?
A) Vicarious liability
B) Joint liability
C) Strict liability
D) Negligence
8) Which federal law protects employees from unfair labor practices of employers?
A) Occupational Safety and Health Act
B) National Labor Relations Act
C) Fair Labor Standards Act
D) Labor Management Relations Act
9) A willful misclassification of workers by an employer may result in harsh sanctions,
including imprisonment and a fine of up to $10,000, under which federal law?
, A) Federal Unemployment Compensation Act (FUTA)
B) Fair Labor Standards Act (FLSA)
C) National Labor Relations Act (NLRA)
D) Federal Insurance Contributions Act (FICA)
10) Which of the following is currently considered to be the leading test to
determine employee status?
A) Common-law agency test
B) IRS 20-factor analysis
C) Economics realities test
D) Degree of control test
11) How many employees must an entity have under The Civil Rights Act of 1866 to qualify
as an employer under the Act?
A) 15 employees
B) 20 employees
C) 50 employees
D) No minimum requirement
12) The Rehabilitation Act of 1973 applies to government contractors that maintain
contracts with the federal government in excess of how much annually?
A) $1,000
B) $5,000
C) $10,000
D) No minimum dollar amount
,13) CMS, Inc. solicited bids from various contractors to develop and maintain the grounds
of its new office complex. Roberta, the head of facilities management at CMS, told her
secretary, LeAnne, that she will not accept any bids from a Russian contractor. She then
rejected a bid made by a Russian contractor without any legitimate reason. If the Russian
contractor brings a lawsuit against CMS for discrimination, what is the likely result?
A) Roberta's refusal to hire Russian contractors will be found to be a violation of
the Social Security Act.
B) Roberta's refusal to hire Russian contractors will be found to be a violation of
the Consumer Protection Act.
C) Roberta's refusal to hire Russian contractors will not be considered an offense
because employers in the United States are free to discriminate against employees based on
their race or national origin.
D) Roberta's refusal to hire Russian contractors will not be considered a violation
of Title VII of the Civil Rights Act because that law does not cover discrimination against
independent contractors.
14) Riley is a freelance handyman hired by Bob’s Burgers whenever small repairs are
needed in the store. Riley is paid per project and usually works at Bob’s Burgers one day a
month. Which of the following is likely true of this scenario?
A) Bob’s burgers will need to withhold a certain percentage of Riley's wages for
federal income tax purposes.
B) Riley cannot be held liable for any torts committed by him within the scope of
the working relationship.
C) Riley can make a claim for medical or retirement benefits from Bob’s Burgers as
he is an employee.
D) Riley cannot make a claim for medical or retirement benefits from Bob’s Burgers
as he is an independent contractor.
15) Employment law based on agency principles imposes a duty on an employee to act
as authorized. If the employee exceeds his or her authority, the employer is:
, A) not liable for any loss or damage that results from the employee's unauthorized acts.
B) liable for damages or losses incurred by third parties and has no recourse against
the employee for the losses incurred.
C) liable for damages or losses incurred by third parties, while the employee
remains liable to the employer.
D) not liable for any loss or damage incurred by third parties, unless the damage
is beyond $35,000.
16) Nelson is misclassified as an independent contractor for FunTime Toys. He is actually
an employee. While driving to a meeting at FunTime's headquarters, Nelson caused a car
accident in which a cab driver was hurt. Upon investigation, it was found that Nelson was on
the phone with one of the managers at FunTime when he was driving that day. Which of the
following may be true in the context of liability for the accident?
A) FunTime has no liability, because Nelson is classified by FunTime as an
independent contractor.
B) FunTime has vicarious liability.
C) FunTime has no liability even if Nelson is an employee.
D) FunTime has strict liability.
17) Chris stocks shelves for a grocery store. While unloading cases of soda, Chris dropped
a case on a customer’s foot causing a severe break. Which of the following is true of the
scenario?
A) The grocery store is not vicariously liable because it was an accident.
B) The grocery store is vicariously liable because Chris was not acting within the
course of employment.
C) The grocery store is not vicariously liable because Chris was not acting within
the course of employment.
D) The grocery store is vicariously liable because Chris was acting within the course of
employment.
,18) Salvatore and Annette are sales managers for Acme USA. Both work full-time in the
Acme offices under the same manager, and share the same type of job responsibilities.
Salvatore was hired as an employeeand is paid a salary. Required federal and state tax
withholdings are made by Acme for Salvatore. Annette was hired as an independent
contractorand is paid by the project. No federal and state withholdings are taken for Annette,
and she does not receive retirement or health insurance benefits. Which of the following is
likely true?
A) Acme properly classified Annette as an independent contractor.
B) Acme willfully misclassified Annette as an independent contractor and is
liable under Fair Labor Standards Act of 1938.
C) Acme has no rights to withhold federal and state taxes for Salvatore if he is
classified as a full-time employee.
D) Acme has to provide more health and retirement benefits to Annette than
Salvatore because Annette is an independent contractor.
19) Jeffrey works as an independent contractor for an accounting firm jointly owned and
managed by the Matthews brothers. Which of the following implications can be drawn from
the scenario?
A) Jeffrey will be solely responsible for making payments for his Social Security
(FICA), federal income tax, state taxes, and Medicare.
B) The accounting firm will be completely responsible for paying Jeffrey's
federal unemployment compensation (FUTA), Medicare, and state taxes.
C) Jeffrey will be protected from unfair labor practices just like an employee under
the National Labor Relations Act of 1935 (NLRA).
D) The accounting firm will have to include Jeffrey in its dental, medical, pension,
and profit-sharing plans.
20) Carol is a nurse in a rehabilitation facility run by Sun Retirement Systems. She works
at least 50 hours every week. After looking at her payroll stubs for the past six months, she
concludes that she has not received her share of overtime pay. With the help of a friend in
the payroll department, Gabriel learns the she has been classified as a temporary employee
so that her overtime pay can be avoided. She complains to her supervisor, but her employer
makes no changes. Which of the following legal courses can Carol take against Sun
Retirement Systems?
, A) Carol can bring a complaint to the U.S. Department of Labor, under the
Social Security Act.
B) Carol can bring a complaint to the U.S. Department of Labor, under the Fair
Labor Standards Act of 1938 (FLSA).
C) Carol can bring a complaint to the U.S. Department of Labor, under the
Employee Retirement Income Security Act of 1974 (ERISA).
D) Carol can bring a complaint to the U.S. Department of Labor, under
Equal Employment Opportunity Act.
21) Blockbuster Stores hired programmers at its headquarters to maintain its online retail
operation. As the size of the online business grew, Blockbuster changed the status of the
programmers from employees to independent contractors, although their job responsibility
increased. For the past 3 years, all new programmers brought on board have signed
documents classifying them as independent contractors. Some of the programmers brought a
court case regarding their status and got a verdict that they were misclassified. Which of the
following is an implication of this scenario?
A) The Internal Revenue Service (IRS) can hold the employer liable for its share of
Social Security and federal unemployment compensation that should have been
withheld.
B) The Internal Revenue Service (IRS) will require the employer to exclude its
programmers from its dental, medical, pension, and profit-sharing plans.
C) The Internal Revenue Service (IRS) will hold the employer liable for a minimum of
10 percent of the wages received by the programmers.
D) The Internal Revenue Service (IRS) will require the programmers to pay all the
outstanding federal taxes, state taxes, and Medicare on their own if their employer fails to
pay.
22) The three main tests courts use to classify employees and independent contractors are:
A) the common-law agency test, the Darden test, and the master-servant rule.
B) the master-servant rule, the common-law agency test, and the GAP analysis.
C) the common-law agency test, the Internal Revenue Service (IRS) 20-factor
analysis, and the economic realities test.
D) the Internal Revenue Service (IRS) 20-factor analysis, Myers-Briggs test, and
earned value analysis.
Employment Law for Business, 10th Edition,
Dawn Bennett-Alexander, Chapters 1 - 16
,TABLE OF CONTENTS
Chapter 1 The Regulation of Employment
Chapter 2 The Employment Law Toolkit: Resources for Understanding the
Law and Recurring Legal Concepts
Chapter 3 Title VII of the Civil Rights Act of 1964
Chapter 4 Legal Construction of the Employment Environment
Chapter 5 Affirmative Action
Chapter 6 Race and Color Discrimination
Chapter 7 National Origin Discrimination
Chapter 8 Gender Discrimination
Chapter 9 Sexual Harassment
Chapter 10 Sexual Orientation and Gender Identity Discrimination
Chapter 11 Religious Discrimination
Chapter 12 Age Discrimination
Chapter 13 Disability Discrimination
Chapter 14 The Employee’s Right to Privacy and Management of Personal
Information
Chapter 15 Labor Law 857
Chapter 16 Selected Employment Benefits and Protections
,Chapter 01: The Regulation of Employment
Answers are at the End of Each Chapter
Student name:
TRUE/FALSE - Write 'T' if the statement is true and 'F' if the statement is false.
1) Agency law, based on the traditional law called master and servant, governs
employment relationships.
⊚ true
⊚ false
2) In an employment-agency relationship, if an agent acts beyond his or her authority,
the principal may be liable for any resulting loss to a third party.
⊚ true
⊚ false
3) Myra provides accounting services as an independent contractor for Great
Northern. Because of this relationship, Great Northern is responsible for withholding and
paying Myra's employment taxes, including federal unemployment compensation (FUTA),
Social Security (FICA) and FICA excise tax.
⊚ true
⊚ false
4) Employers are not liable for most torts committed by an independent contractor
within the scope of the working relationship.
⊚ true
⊚ false
5) There is a single commonly accepted definition of "employee" used by courts,
employers, and the government.
, ⊚ true
⊚ false
6) Fresh Ideas employs part-time workers through a staffing firm. After the staffing
firm sent over a part-time office assistant, Fresh Ideas asked the firm to replace her with
someone from a different race. The replaced office assistant cannot proceed with a
discrimination claim under Title VII of the Civil Rights Act since she (the part-time office
assistant) was never an employee of Fresh Ideas.
⊚ true
⊚ false
MULTIPLE CHOICE - Choose the one alternative that best completes the statement or
answers the question.
7) If an employee has a car accident while driving a company car from one company
office to another, the employer may be liable to the owner of the other vehicle under which
legal theory?
A) Vicarious liability
B) Joint liability
C) Strict liability
D) Negligence
8) Which federal law protects employees from unfair labor practices of employers?
A) Occupational Safety and Health Act
B) National Labor Relations Act
C) Fair Labor Standards Act
D) Labor Management Relations Act
9) A willful misclassification of workers by an employer may result in harsh sanctions,
including imprisonment and a fine of up to $10,000, under which federal law?
, A) Federal Unemployment Compensation Act (FUTA)
B) Fair Labor Standards Act (FLSA)
C) National Labor Relations Act (NLRA)
D) Federal Insurance Contributions Act (FICA)
10) Which of the following is currently considered to be the leading test to
determine employee status?
A) Common-law agency test
B) IRS 20-factor analysis
C) Economics realities test
D) Degree of control test
11) How many employees must an entity have under The Civil Rights Act of 1866 to qualify
as an employer under the Act?
A) 15 employees
B) 20 employees
C) 50 employees
D) No minimum requirement
12) The Rehabilitation Act of 1973 applies to government contractors that maintain
contracts with the federal government in excess of how much annually?
A) $1,000
B) $5,000
C) $10,000
D) No minimum dollar amount
,13) CMS, Inc. solicited bids from various contractors to develop and maintain the grounds
of its new office complex. Roberta, the head of facilities management at CMS, told her
secretary, LeAnne, that she will not accept any bids from a Russian contractor. She then
rejected a bid made by a Russian contractor without any legitimate reason. If the Russian
contractor brings a lawsuit against CMS for discrimination, what is the likely result?
A) Roberta's refusal to hire Russian contractors will be found to be a violation of
the Social Security Act.
B) Roberta's refusal to hire Russian contractors will be found to be a violation of
the Consumer Protection Act.
C) Roberta's refusal to hire Russian contractors will not be considered an offense
because employers in the United States are free to discriminate against employees based on
their race or national origin.
D) Roberta's refusal to hire Russian contractors will not be considered a violation
of Title VII of the Civil Rights Act because that law does not cover discrimination against
independent contractors.
14) Riley is a freelance handyman hired by Bob’s Burgers whenever small repairs are
needed in the store. Riley is paid per project and usually works at Bob’s Burgers one day a
month. Which of the following is likely true of this scenario?
A) Bob’s burgers will need to withhold a certain percentage of Riley's wages for
federal income tax purposes.
B) Riley cannot be held liable for any torts committed by him within the scope of
the working relationship.
C) Riley can make a claim for medical or retirement benefits from Bob’s Burgers as
he is an employee.
D) Riley cannot make a claim for medical or retirement benefits from Bob’s Burgers
as he is an independent contractor.
15) Employment law based on agency principles imposes a duty on an employee to act
as authorized. If the employee exceeds his or her authority, the employer is:
, A) not liable for any loss or damage that results from the employee's unauthorized acts.
B) liable for damages or losses incurred by third parties and has no recourse against
the employee for the losses incurred.
C) liable for damages or losses incurred by third parties, while the employee
remains liable to the employer.
D) not liable for any loss or damage incurred by third parties, unless the damage
is beyond $35,000.
16) Nelson is misclassified as an independent contractor for FunTime Toys. He is actually
an employee. While driving to a meeting at FunTime's headquarters, Nelson caused a car
accident in which a cab driver was hurt. Upon investigation, it was found that Nelson was on
the phone with one of the managers at FunTime when he was driving that day. Which of the
following may be true in the context of liability for the accident?
A) FunTime has no liability, because Nelson is classified by FunTime as an
independent contractor.
B) FunTime has vicarious liability.
C) FunTime has no liability even if Nelson is an employee.
D) FunTime has strict liability.
17) Chris stocks shelves for a grocery store. While unloading cases of soda, Chris dropped
a case on a customer’s foot causing a severe break. Which of the following is true of the
scenario?
A) The grocery store is not vicariously liable because it was an accident.
B) The grocery store is vicariously liable because Chris was not acting within the
course of employment.
C) The grocery store is not vicariously liable because Chris was not acting within
the course of employment.
D) The grocery store is vicariously liable because Chris was acting within the course of
employment.
,18) Salvatore and Annette are sales managers for Acme USA. Both work full-time in the
Acme offices under the same manager, and share the same type of job responsibilities.
Salvatore was hired as an employeeand is paid a salary. Required federal and state tax
withholdings are made by Acme for Salvatore. Annette was hired as an independent
contractorand is paid by the project. No federal and state withholdings are taken for Annette,
and she does not receive retirement or health insurance benefits. Which of the following is
likely true?
A) Acme properly classified Annette as an independent contractor.
B) Acme willfully misclassified Annette as an independent contractor and is
liable under Fair Labor Standards Act of 1938.
C) Acme has no rights to withhold federal and state taxes for Salvatore if he is
classified as a full-time employee.
D) Acme has to provide more health and retirement benefits to Annette than
Salvatore because Annette is an independent contractor.
19) Jeffrey works as an independent contractor for an accounting firm jointly owned and
managed by the Matthews brothers. Which of the following implications can be drawn from
the scenario?
A) Jeffrey will be solely responsible for making payments for his Social Security
(FICA), federal income tax, state taxes, and Medicare.
B) The accounting firm will be completely responsible for paying Jeffrey's
federal unemployment compensation (FUTA), Medicare, and state taxes.
C) Jeffrey will be protected from unfair labor practices just like an employee under
the National Labor Relations Act of 1935 (NLRA).
D) The accounting firm will have to include Jeffrey in its dental, medical, pension,
and profit-sharing plans.
20) Carol is a nurse in a rehabilitation facility run by Sun Retirement Systems. She works
at least 50 hours every week. After looking at her payroll stubs for the past six months, she
concludes that she has not received her share of overtime pay. With the help of a friend in
the payroll department, Gabriel learns the she has been classified as a temporary employee
so that her overtime pay can be avoided. She complains to her supervisor, but her employer
makes no changes. Which of the following legal courses can Carol take against Sun
Retirement Systems?
, A) Carol can bring a complaint to the U.S. Department of Labor, under the
Social Security Act.
B) Carol can bring a complaint to the U.S. Department of Labor, under the Fair
Labor Standards Act of 1938 (FLSA).
C) Carol can bring a complaint to the U.S. Department of Labor, under the
Employee Retirement Income Security Act of 1974 (ERISA).
D) Carol can bring a complaint to the U.S. Department of Labor, under
Equal Employment Opportunity Act.
21) Blockbuster Stores hired programmers at its headquarters to maintain its online retail
operation. As the size of the online business grew, Blockbuster changed the status of the
programmers from employees to independent contractors, although their job responsibility
increased. For the past 3 years, all new programmers brought on board have signed
documents classifying them as independent contractors. Some of the programmers brought a
court case regarding their status and got a verdict that they were misclassified. Which of the
following is an implication of this scenario?
A) The Internal Revenue Service (IRS) can hold the employer liable for its share of
Social Security and federal unemployment compensation that should have been
withheld.
B) The Internal Revenue Service (IRS) will require the employer to exclude its
programmers from its dental, medical, pension, and profit-sharing plans.
C) The Internal Revenue Service (IRS) will hold the employer liable for a minimum of
10 percent of the wages received by the programmers.
D) The Internal Revenue Service (IRS) will require the programmers to pay all the
outstanding federal taxes, state taxes, and Medicare on their own if their employer fails to
pay.
22) The three main tests courts use to classify employees and independent contractors are:
A) the common-law agency test, the Darden test, and the master-servant rule.
B) the master-servant rule, the common-law agency test, and the GAP analysis.
C) the common-law agency test, the Internal Revenue Service (IRS) 20-factor
analysis, and the economic realities test.
D) the Internal Revenue Service (IRS) 20-factor analysis, Myers-Briggs test, and
earned value analysis.
