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Chapter. 17. Maintaining Good Government Relations and Business Ethics. Chapter Outline. TM 17-1. Chapter 17 MAINTAINING GOOD GOVERNMENT RELATIONS AND BUSINESS ETHICS I. Understanding the Legal Environment. II. Some Basic Laws Affecting Small Business.

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  1. Chapter 17 Maintaining Good Government Relations and Business Ethics

  2. Chapter Outline TM 17-1 • Chapter 17 • MAINTAINING GOOD GOVERNMENT RELATIONS AND BUSINESS ETHICS • I. Understanding the Legal Environment. • II. Some Basic Laws Affecting Small Business. • III. Government Help for Small Business. • IV. Handling Government Regulations and Paperwork. • V. Choosing and Using a Lawyer. • VI. Socially and Ethically Responsible Behavior. • VII. What You Should Have Learned.

  3. Basic Legal Principles TM 17-2 1 • Everyone is equal under the law. • Everyone is entitled to his or her day in court. • A person is presumed innocent until proven guilty. 2 3

  4. Selected Basic Legal Terminology Text Table 17-1 TM 17-3A • Common lawè Unwritten law derived from judicial decision based on customs and usages accepted by the people. • Statutory lawè Body of laws passed by federal, state, and local governments. • Interstate è Gives Congress the right to "regulate commerce • commerce clause with foreign nations, and among the several states." • Police powerè States' right to regulate business, including the right to use the force of the state to promote the general welfare of citizens. All laws must be based on the federal or a state constitution. • Due processè Implies that everyone is entitled to a day in court, and all processes must be equal and fair. continued

  5. Selected Basic Legal Terminology(continued) Text Table 17-1 TM 17-3B • Legislative branch è The U.S. Congress, state legislature, country/city • ofgovernment council, or any other body that passes laws. • Executive branch è President, governor, mayor, or any other who • ofgovernment enforces the laws through regulatory agencies and decrees. • Judicial branch ofè The court system, or those who interpret the laws • government and supervise enforcement. • Public lawè Deals with the rights and powers of the government. • Criminal lawè Deals with punishing those who commit illegal acts. • Private lawè Is administered between two or more citizens. • Civil lawè Deals with violations against another person who has been harmed in some way.

  6. GENERAL PROVISIONS SALES COMMERCIAL PAPER BANK DEPOSITS AND COLLECTIONS LETTERS OF CREDIT BULK TRANSFERS DOCUMENTS OF TITLE INVESTMENT SECURITIES SECURED TRANSACTIONS The Provisions of the Uniform Commercial Code TM 17-4

  7. ORDINARY, or STRAIGHT BANKRUPTCY Debtor files with a court claiming that debts exceed assets. When a creditor files the petition against the debtor, it is an involuntary bankruptcy CHAPTER 11 BANKRUPTCY, or REORGANIZATION Has a provision for reorganizing the bankrupt business The firm can continue to operate while its debts are being repaid. Types of Bankruptcy TM 17-5

  8. SBA Answer Desk Text Figure 17-2 TM 17-6 • SBA ANSWER DESK • 1‑800‑U‑ASK‑SBA (800‑827‑5722) • The toll‑free telephone number listed above is for the small business information and referral service being offered by the U.S. Small Business Administration. Call for information on starting a new business or for sources • of technical and financial assistance • for an already existing business.

  9. Government Help for Small Business TM 17-7A • Small Business Administration • Provides direct and guaranteed loans for small firms • Provides publications, workshops, small business institutes • Sponsors the Service Corps of Retired Executives (SCORE) • U.S. Department of Commerce • International Trade Administration • Foreign Commercial Service Agency (USFCSA) • Minority Business Development Agency (MBDA) • Census Bureau

  10. Government Help for Small Businesses (cont’d) TM 17-7B • Other Government Agencies • U.S. Department of Agriculture • Cooperative Extension Service • The Federal Land Bank Association • Production Credit Association • The Farmers Home Administration

  11. Regulations Tend to Discourage Hiring More Workers TM 17-8 • EMPLOYEES • Occupation Safety and Health Act 10 • Federal civil rights laws 15 or more • Americans with Disabilities Act 15 • Family and Medical Leave Act 50 • Worker Adjustment and Retraining Act 100 The following laws apply to small companies with the number of employees shown:

  12. Government Policies Perceived as the Most Serious Threats to Privately Held Businesses Text Table 17-2 TM 17-9 • Government-required paperwork 97% • Taxes on businesses 95% • Environmental regulations 82% • Health care reform 81% • Product liability laws 78% • Government pension laws 77%

  13. A Sample Contract for a Lawyer’s Services Text Figure 17-2 TM 17-10 • I, John Doe, hereby agree to employ the law firm of Ruth Roe to represent me and act on my behalf and in my best interest in presenting a claim for any and all damages, including my personal injury, resulting from an accident which occurred on or about June 29, 1993, near Bethesda, Maryland. • I agree to pay to said firm an amount equal to 30 percent of any and all sums collected by way of settlement or from legal action. In the event of trial (as determined as of the time a jury is impaneled), I agree to pay said firm an amount equal to 50 percent of any amounts received. • Be it further understood that no settlement will be made without consent of client. It is understood that if nothing is obtained on client's behalf, then client owes nothing to said law firm, except for the expenses associated with handling this case. • Said law firm agrees to act on client's behalf with all due diligence and in client's best interest at all times in prosecuting said claims. • DATED this _____ day of_____________ , 19_____ • Ruth Roe • By: _____________________

  14. What Social Responsibility Involves TM 17-11A • CONSUMERISM, the organized effort of independent, government, and business groups to protect consumers from undesirable effects of poorly designed and produced products. • ENLIGHTENED EMPLOYEE RELATIONS, showing interest in and concern for employees' rights: • meaningful employment, training, development, promotion, pay, and health and safety. • a greater effort to hire qualified persons without regard to race, sex, religion, color, creed, age, or disabilities. continued

  15. What Social Responsibility Involves (continued) TM 17-11B • ENVIRONMENTAL PROTECTION, maintain a healthy balance between people and their environment. • Pollution control, trying to prevent the contamination or destruction of the natural environment. • Conservation, practicing the most effective use of resources, while considering society’s current and future needs. • Recycling, reprocessing used items for future use. continued

  16. What Social Responsibility Involves (continued) TM 17-11C • COMMUNITY RELATIONS • Providing assistance to educational and medical institutions. • Urban development renewal. • Contributions to hometown arts, cultural, and recreational activities.

  17. Ethics Lapses in Workplace Text Table 17-3 TM 17-12 • Four in 10 workers say they know of ethical or legal violations at their company in the past two years. Here’s what they know of: • REPORTED VIOLATION PERCENTAGE REPORTING • Sexual harassment 19% • Lying on reports/records 16% • Conflict of interest 15% • Stealing/theft 15% • Lying to supervisor 15% • Bias (race, age, etc.) 15% • Drug/alcohol abuse 12%

  18. Rotary International’s Four-Way Test TM 17-13 • Is it the TRUTH? • Will it build GOOD-WILL and BETTER FRIENDSHIPS? Rotary International’s “The Four-Way Test” of things we think, say, or do: 2 1 Is it FAIR? Will it be BENEFICIAL to all concerned? 3 4

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