Agency Law Terminology and the Scenario

In the scenario described, the small business owner’s friends may be considered agents of the business. An agency relationship is a legal relationship between two parties, the principal and the agent, where the agent is authorized to act on behalf of the principal. In this case, the business owner (the principal) hired their friends (the agents) to deal with vendors and customers.

There are three ways an agency relationship can be created:

• Express agreement: This is the most common way to create an agency relationship. It can be oral or written.
• Implied agreement: This is an agency relationship that is created by the conduct of the parties. For example, if a business owner allows someone to act on their behalf without objection, an agency relationship may be implied.
• Agency by estoppel: This is an agency relationship that is created by law, even if the parties did not intend to create one. For example, if someone acts as an agent for another person without their authorization, but the other person does not object, the other person may be estopped from denying that the agency relationship exists.

Scope of Employment

Scope of employment is a legal concept that determines whether an employer is liable for an employee’s actions. An employee is generally only acting within the scope of their employment if they are doing something that is authorized by their employer and that is reasonably related to their job duties.

In the scenario described, Leo’s order of way too much from a vendor may not be considered within the scope of his employment. This is because he was not authorized to order such a large amount of supplies, and his actions were not reasonably related to his job duties.

Employee-at-Will

An employee-at-will is an employee who can be fired by their employer for any reason, or for no reason at all. This means that the employer does not need to have a cause for firing the employee, and the employee does not have to be given any notice of termination.

However, there are some exceptions to the employee-at-will doctrine. For example, an employer cannot fire an employee for illegal reasons, such as discrimination based on race, gender, or religion. Additionally, some states have laws that protect employees who are fired for whistleblowing or for engaging in other protected activities.

Recent Lawsuit in Georgia

In 2021, a Georgia man filed a lawsuit against his former employer, alleging that he was wrongfully terminated in violation of the Employment-at-Will doctrine. The man claimed that he was fired after he complained about his supervisor’s sexual harassment.

The case is still pending, but it could have a significant impact on the law of employment-at-will in Georgia. If the man is successful in his lawsuit, it could set a precedent that would make it more difficult for employers to fire employees without cause.

Conclusion

Agency law is a complex area of law that can have a significant impact on small businesses. It is important for small business owners to understand the basics of agency law so that they can avoid legal liability. Additionally, it is important to be aware of the exceptions to the employee-at-will doctrine so that they do not fire employees for illegal reasons.