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Chapter 14

Chapter 14. Common Law Rules in Employer-Employee Relations . Employer-Employee Legal Classifications. Master-servant relationship One person employs another in tasks not involving contracts Principal-agent relationship One person employs another to contract with third persons

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Chapter 14

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  1. Chapter 14 Common Law Rules in Employer-Employee Relations

  2. Employer-EmployeeLegal Classifications • Master-servant relationship • One person employs another in tasks not involving contracts • Principal-agent relationship • One person employs another to contract with third persons • Employer-independent contractor relationship • One person hires another and has no control over how the contractor performs the work

  3. Effect of Employer-Employee Classifications • Respondeat superior • Nondelegable duties • Consensual relations • Gratuitous agent

  4. Types of Agents • General agent • Has authority to act on another’s behalf in many different matters • Del credere agent • Sells goods for another on credit and guarantee that agent will pay if buyer does not • Special agent • Accomplishes particular tasks

  5. How Agency Authority is Created • Express authority • Agreement in writing • Implied authority • Agreement by inference • Apparent authority • Agreement by conduct • Ratification • Agreement conferred retroactively

  6. Common Law Duties • Master-to-servant • Provide safe work place • Provide safe tools • Reasonably pay servant

  7. Common Law Duties • Principal-to-agent • Pay agent specified amount • Advance money if the contract provides for it • Reimburse ordinary expenses • Indemnify agent for losses sustained while agent performs tasks • Duty of care

  8. Common Law Duties • Agents-to-principals • Duty to account • Duty to use care and skill • Duty to follow instructions • Fiduciary duty

  9. Agent or ServantLiability: Torts • Indemnity • Respondeat superior principal • Scope of employment • Distinction between where agent’s responsibilities end and duties begin can be difficult to ascertain

  10. Agent Liability to Third Persons: Contracts • Agents may be subjected to liability to third persons with respect to contracts in three ways: • On the contract • For the tort of fraud • For breach of warranty of authority

  11. Liability for Crimes • Employee liability • Employer liability • Criminal conspiracy • Corporate employers • Respondeat superior • Superior agent rule

  12. How Agencies End • Voluntary completion of the tasks for which agent was hired • Death of principal or agent • Insanity of principal or agent • Bankruptcy of principal • Physical incapacitation of agent • Illegality of activities for which the agent was hired

  13. Ending of Employment Relationship: Employment-at-Will • Wrongful dismissal lawsuits in general • Employee actions causing wrongful dismissal • Legal limits on wrongful dismissal • Notice of ending of agency

  14. Recap – Terms to Know • Employer-employee legal classifications • Respondeat superior • Nondelegable duties • Consensual relations • Gratuitous agent • General, del credere, and special agent • Express, implied, and apparent agency • Indemnity • Respondeat superior principal • Employment-at-will

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