IWU Employment Relationships Question

Why are agency relationships necessary? For one, they afford a high level of flexibility in business dealings. Imagine for a moment that you own an online tech company. It would be very difficult for you to manage every single aspect of business operations by yourself. Agency relationships make it possible for you to delegate key tasks to others who are capable of carrying them out. For example, your human resource management team can oversee sourcing, recruitment, hiring, and other human resource functions. Because of their unique job skills, human resource team members are better equipped to handle staffing matters than you are.

As with any business relationship, you must be careful about designating who is and is not an agent of your business. Remember, the agency relationship is considered an employer-employee relationship. Therefore, you can incur financial and legal liability for the actions of your agents. As a general rule, you are not liable for the actions of independent contractors, because they are not your employees and you do not control or oversee the details of their job duties. As part of your business practices, you must clearly establish the type of employment relationship you have with the individuals you hire.

Upon successful completion of the course material, you will be able to:

Explain the principal-agent relationship.

Categorize the rights, duties, and liabilities of the principal and the agent in an agency relationship.

Resources

Textbook: The Legal Environment of Business

Media: Agency Transactions

Background Information

Principals hire agents to represent them or act on their behalf in transactions with third parties. Agents agree to act ethically by being loyal and acting in the best interests of the principal. Agents also owe a duty to account for the principal’s property and to obey reasonable instructions. In turn, the principal owes a duty to compensate the agent for services rendered or expenses incurred while acting on behalf of the principal.

Because a disclosed agent (one who is known to act on behalf of a principal) may legally bind his/her principal to an agreement, it is important that the principal notify third parties once an agency relationship has ended. Principals must also carefully monitor agents to ensure they do not exceed the scope of their agency authority. Principals can be held liable for agent misconduct under the doctrine of respondeat superior.

Instructions

Review the rubric to make sure you understand the criteria for earning your grade.

In your textbook, The Legal Environment of Business, read Chapter 14, “Agency and the Employment Relationship.”

Review the media “Agency Transactions.”

Through Internet research, review the 20-Factor Test that courts and the Internal Revenue Service (IRS) use to determine whether an individual is an employee or an independent contractor. Research the characteristics that determine if a person involved in selling or marketing for an entity is an employee or an independent contractor.

Make up a hypothetical scenario involving the question of whether an individual is an employee or an independent contractor.

1/31/22, 10:01 AM
Preview Rubric: Course Assignments – 4WI2021 Business Law (ADM-447-01B) – Indiana Wesleyan University
Course Assignments
Course: 4WI2021 Business Law (ADM-447-01B)
Criteria
Content
Level 4
Level 3
Level 2
Level 1
30 points
25 points
20 points
15 points
(26–30 points
possible)
(21–25 points
possible)
(16–20 points
possible)
(0–15 points possible)
You address all of the
requirements of the
assignment.
You address most of
the requirements of
the assignment.
You address some of
the requirements of
the assignment.
You address few or
none of the
requirements of the
assignment.
You display excellent
organization.
You display very good
organization.
You display good
organization.
You do not display
effective organization.
https://brightspace.indwes.edu/d2l/lp/rubrics/preview.d2l?ou=158670&rubricId=488082&originTool=quicklinks
Criterion Score
/ 30
1/3
1/31/22, 10:01 AM
Criteria
Critical Thinking
Preview Rubric: Course Assignments – 4WI2021 Business Law (ADM-447-01B) – Indiana Wesleyan University
Level 4
Level 3
Level 2
Level 1
20 points
15 points
10 points
5 points
(16–20 points
possible)
(11–15 points
possible)
(6–10 points possible)
(0–5 points possible)
You demonstrate clear,
insightful critical
thinking when you:
You demonstrate
competent critical
thinking when you:
You demonstrate
limited critical thinking
when you:
You demonstrate little
or no critical thinking
when you:
Examine key
issues.
Scrutinize the
meaning of the
information.
Apply relevant
criteria to the
problem or
issue.
Describe key
issues.
Describe the
content of the
source
materials.
Describe the
meaning of the
information.
Define the
criteria and
reasoning used
to make
judgments.
https://brightspace.indwes.edu/d2l/lp/rubrics/preview.d2l?ou=158670&rubricId=488082&originTool=quicklinks
Mention key
issues.
Record the
content found
in the source
materials.
Identify
potential
meanings of the
information.
Identify criteria
used for making
judgments.
Criterion Score
/ 20
Do not raise key
issues.
Miss key source
materials.
Ignore or
misrepresent
the meaning of
the information.
Do not use
criteria or use
invalid criteria
for making
judgments.
2/3
1/31/22, 10:01 AM
Criteria
Grammar, Spelling,
Length, and
Citation
Preview Rubric: Course Assignments – 4WI2021 Business Law (ADM-447-01B) – Indiana Wesleyan University
Level 4
Level 3
Level 2
Level 1
10 points
7 points
4 points
2 points
(8–10 points possible)
(5–7 points possible)
(3–4 points possible)
(0–2 points possible)
Your sentence
structure is complete,
with correct spelling,
punctuation, and
capitalization, and
varied diction and
word choice.
Your sentence
structure has minor
errors (fragments, runons), with correct
spelling, punctuation,
and capitalization, but
limited diction and
word choice.
Your sentence
structure has several
errors in sentence
fluency, with multiple
fragments/run-ons and
poor spelling,
punctuation, and/or
word choice
Your sentence
structure has serious
and persistent errors in
sentence fluency,
spelling, punctuation,
and/or word choice.
Your assignment
length is correct, with
minor errors in APA
formatting.
Your assignment
length is inadequate,
with several APA
errors.
Your assignment
length is correct, with
correct APA
formatting.
Total
Criterion Score
/ 10
Your assignment
length is inadequate
with several APA
errors.
/ 60
Overall Score
Total Points
0 points minimum
https://brightspace.indwes.edu/d2l/lp/rubrics/preview.d2l?ou=158670&rubricId=488082&originTool=quicklinks
3/3