5. Areas of Business Law
● In the United States, business law is comprised of two sets of law.
○ Common Law, the broadly used term for federal
○ Uniform Commercial Code, which governs the sale of goods in the United States to consumers
● Business Law can be broken into subcategories
○ Contracts and Formations
○ Employment Law
○ Sale of Goods to consumers and commercial paper
○ Intellectual Property
○ Antitrust
○ Tax Law
○ Bankruptcy
○ Immigration
6. Intellectual Property
● “Intellectual property is integral to helping us put together our ideas and put them out
in the world in a way that gives us the freedom to be creative, all while knowing the
laws protecting us.”
● “Intellectual property, or, as we like to call it, IP, is the set of laws the protects our
goods, services, inventions, and creativity and how they're marketed.”
● There are three types of Intellectual Property in the United States: copyright,
trademark, and patent.
7. Employment Law 101
● “The happiest environment is lawsuit free.”
● There are laws and regulations that protect you and the people you manage in your
work environment
8. Torts and The Court System
● “A tort is a civil wrong for which a remedy may be obtained, usually in the form of
damages. This can include injury in the following ways: slip-and-fall accidents,
medical and legal malpractice, assault, motor vehicle accidents, product liability
injuries, and the one that could affect you or a member of the group you manage,
workplace accidents.”
● Tort claims are filed in civil court as opposed to criminal.
● “There are two standard ways an employee can pursue a claim against their employer:
through the court system and arbitration.”
10. Your Responsibilities on Behalf of The Company
● “It’s best that you remember the laws and the regulations that govern your company
and your work along with your code of ethics to be 100% sure.”
● “You’re responsible for your own health and safety and that of your employees.”
● “By following guidelines, along with your company’s rules and the federal and state
laws related to your work, you’ll be well on your way to not only being a fabulous
manager, but a safe one as well.”
11. How To Recognize and Mitigate Risks
● “Business ethics is a set of moral and ethical behavior standards each officer or
employee must follow, outlined by a company regarding their business activity and
the distribution of goods and services in the marketplace.”
● Three step process which may help reduce the legal exposure of your company and
yourself:
○ Arrange a meeting with the employee
○ Make a record
○ Discipline
12. Potential Personal Liability: How To Prevent It
● “If you’re personally liable for your actions, this could mean that you could be sued civilly, encounter fines,
infractions administered by the state or federal government, or even serve a prison sentence if you’re held
liable in criminal court.”
● Here are some of the ways liability could happen:
○ Unlawful termination
○ Failure to comply with employment legislation
○ Failure to keep employment records
○ Failure to report a breach
● “If you keep it in check, you’ll keep it out of court.”
13. When To Bring In A Legal Professional
● Just a few example situations where a company or manager should bring in a legal professional:
○ When the employee has access to trade secrets or very sensitive information within the company
○ When an employee is part of a protected class and has claimed discrimination
○ If the employment contract in some way limits your rights to fire them, or, if an employee has claimed
workplace harassment and if an employee has a propensity for violence, vandalism, or erratic behavior
● “Make sure that you’re in direct contact with human resources”
● “When in doubt ask a lawyer. It’s better to be safe and legally protected than sorry and wish you’d done
things differently.”
15. Wrongful Discharge
● “To have a claim, the former employee would need to have an illegal reason, meaning the employee was fired
on the basis of discrimination for their sex, race, color, gender, national origin, religion, age, pregnancy, or
disability.”
○ “A claim can also be filed on the basis of a contractual breach or a retaliation by an employer.”
● “If an employee wants to lodge a complaint, their first step would be to head over to the Equal Employment
Opportunity Commission, or EEOC.”
● “Cover yourself and your company by following procedure. Human resources will ensure that the steps are
outlined and aligned with the current developments in the law.”
16. Harassment
● “Workplace harassment is defined by the Department of Labor in two categories, quid pro quo and hostile work environment
harassment.”
○ Quid pro quo, or this or that, harassment involves a tangible work decision based on an employee’s acceptance or
rejection of sexual advancements, requests for sexual favors, or even unwelcome conduct of a religious nature.”
○ Hostile work environment is the type of behavior from individuals that creates an atmosphere that fills intimidating,
hostile, or offensive for someone else.”
● To determine if the conduct is unlawful:
○ Is the unlawful harassing conduct based on a victim’s protected class?
○ Is the conduct unwelcome?
○ Is the hostility subjectively abusive to the victim?
● “Keep your hands to yourself, focus on your work, and be nice to everyone, but not too nice.”
17. Discrimination
● The EEOC defines workplace discrimination as discrimination in any aspect of
employment, including hiring, firing, pay, job assignments, promotions, layoff,
training, benefits, and any other term or condition of employment.”
● “The protected classes include age, disability, genetic information, national origin,
pregnancy, race or color, religion, or sex.”
● “Keep it fair and equal.”
18. Fair Labor Standards Act (FLSA) and Family Medical
Leave Act (FMLA)
● “FMLA was an act created to help working people have a balance between the jobs that are important to them and their life
outside their families.”
○ “An employee can take up to 12 weeks of non-paid vacation if they’ve been working as their company at least 12
months, have worked at least 1,250 hours in the past 12 months, and their company employs more than 50 people within
a 75 mile radius. You may also take time off if you have pregnancy complications.”
● “FLSA is in place to establish the minimum wage rates, overtime rates, and child labor standards in the country for employees
working in the private sector amongst others.”
● “These acts are important to you (as a manager) because if your employees need to take time off, you need to know where, how,
and if they’re within their rights to do so and how that impacts your team.”
20. The Business Law and Ethics Overlap
● “Business law is the set of laws and regulations that govern all aspects of a
company’s business activity. This law includes but is not limited to corporate law,
intellectual property, immigration, labor laws, torts, employment laws, et cetera.”
● “Business ethics is the set of moral and ethical behavior standards each employee
must follow, outlined by a company regarding their business activity and distribution
of goods and services in the marketplace.”
“Business law and business ethics are like two ships passing in
the night that could crash at any point.”
21. What To Do When Facing An Ethical Dilemma
● There are five steps process to evaluating how to handle and make an ethical
decision:
○ Know how to spot them when they arise
○ Evaluate
○ Clarify
○ Determine
○ Take action based on that decision
22. How To Protect The Company and Yourself From
Liability
● “Business ethics are defined as a set standard of moral behavior determined by the
company related to the conduct of the employees and the distribution of goods and
services in the marketplace.”
○ “This behavior also affects their stakeholders. A stakeholder can be the company’s employees, the
executive board, special interest groups, and society as a whole.”
● Formula to follow:
○ Know the code
○ Follow the code
○ Set the standards
○ Keep records
24. What Is the Corporate Veil?
● “When a corporation or limited liability company, also known as an LLC, is filed under the law of the state
and/or country, that company is considered to be its own legal entity. This means that it is separate from the
owners, members, and shareholders who created it or own it.”
○ “The entity can enter into its own contracts, it can incur debts, credits, revenue, and be liable to
creditors.”
■ “The courts will look at the liabilities of the company and hold the directors, officers, owners,
and shareholders personally responsible. This concept is called piercing the corporate veil.”
● “The courts consider the veil, or alternate ego for individuals who would otherwise be liable for debts and
responsibilities incurred by the company.”
● “There are several ways that a company can prevent the corporate veil from getting pierced.”
25. The Corporate Veil and Corporate Wrongdoing
● “A legally formed corporation is considered its own entity under the eyes of the law.”
● How a corporation stays on the right side of the veil:
○ No commingling of funds
○ Maintain corporate formalities
○ Maintain integrity
○ Don’t use company assets for your personal use
○ Don’t purchase smaller businesses in hopes of diverting your debts and liabilities to those companies to
keep the larger parent corporate safe
● “Don’t engage in fraudulent activities or illegal behavior.”
26. The Corporate Veil and Your Role As A Manager
● “The courts consider the company a veil or alter ego for individuals who otherwise
would be liable for debts and responsibilities incurred by the company.”
● “It’s important that you uphold the standards of the corporation within your position
so the courts won’t see fit to pierce the veil.”