Legal and Ethical Issues in U.S. Employee Management

Introduction: Corporate Ethics and Workforce Diversity

Pressure groups and consumers appear to have been placing increasing demands on firms to seek more ecological and ethical means of conducting business. The media, too, appears to be focusing on abuses and malpractices in the corporate sector. Firms themselves seem to be more aware of the fact that being ethical — or at least creating a perception of being ethical — may be crucial for business success.

According to research, minor differences in treatment can accumulate and lead to major disparities over time. It is therefore crucial for managers to ensure that differences among people — for instance in race and ethnicity — do not account for differences in treatment. Managers should be able to understand the beliefs and limitations of their partners and should not force partners to participate in activities or speak in ways that are contrary to their values. Creating such an environment would foster a relationship that is more personal yet respectful between the manager and the partner. To build such a relationship, several strategies have been proposed and discussed (Morais et al., 2014, p. 41).

Key Legal Issues Pertaining to U.S. Employees

The Fair Labor Standards Act (FLSA) formulates standards that must be followed in the payment of wages and overtime. This affects most public and private employment. It is the role of the Wage and Hour Division to administer this Act. Covered employees must be paid the minimum wage and overtime pay set by federal law — typically one-and-one-half times the regular rate of pay. For non-agricultural operations, the Act restricts the hours that children under age 16 are allowed to work and prohibits employers from employing workers under 18 years of age in jobs considered to be hazardous (United States Department of Labor, n.d.).

The Occupational Safety and Health Administration (OSHA), or approved state programs, covers public sector companies and regulates the health and safety of employees in most private industries. Employers covered under the OSHA Act must comply with the laws and health and safety standards it sets. The Act also requires employers to provide workplaces free from recognized hazards (United States Department of Labor, n.d.).

The Energy Employees Occupational Illness Compensation Program Act (EEOICPA) is a reimbursement program that provides total funds of $150,000 along with medical benefits to employees of the Department of Energy and its contractors. This coverage exists because such workers are exposed to the risk of cancer due to radiation exposure. Other illnesses resulting from exposure to silica or beryllium incurred while employees are performing their duties are also covered. A $50,000 payment and medical benefits are provided to individuals whom the Department of Justice determines to be qualified as uranium workers under Section 5 of the Radiation Exposure Compensation Act (RECA) (United States Department of Labor, n.d.).

Employers who offer pension or welfare benefits to their employees are governed by the Employee Retirement Income Security Act (ERISA). The Employee Benefits Security Administration (EBSA), formerly known as the Pension and Welfare Benefits Administration, administers Title I of ERISA and establishes a variety of disclosure, reporting, and fiduciary requirements for trustees of pension and welfare benefit plans and others connected to this process (United States Department of Labor, n.d.).

Commonly known as the Landrum-Griffin Act, the Labor-Management Reporting and Disclosure Act (LMRDA) of 1959 governs the relationship between a union and its members. It protects union funds and advocates for democratic governance within unions. Labor organizations are required to file financial reports annually, while union officials and labor consultants must file reports addressing specific labor relations practices. The Act also establishes standards for the process of electing union officials (United States Department of Labor, n.d.).

Legal Issues by Employee Location: Europe and Asia Compared

Europe's labor laws are similar to those of the United States in areas such as hiring, family leave, working time, agency workers, and European Works Councils, among others. However, notable differences exist — for example, in laws regarding discrimination, severance pay, business transfers, information and consultation rights, and dismissal procedures, which are more comprehensively addressed in European law than in that of the United States (Bevitt & Stakim, 2012).

An interesting characteristic of labor law in most East Asian nations is the estrangement between the extensive dimensions of labor market regulation and policymaking on one hand, and the formal "traditional" employee protection model on the other. It can be argued that the lack of collective bargaining and centralized control from a single trade union organization in East Asia has inevitably drawn attention to broader labor market perspectives on the role and policies of the state (Cooney et al., 2003, p. 1970).