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Legal Environment of Business
Question 6: Pizza Hut case: Is either franchisor or franchisee liable for sexual harassment? If so, what type of sexual harassment occurred? Please fully explain your answer.
In this case, the franchisee is liable for the hostile work environment sexual harassment type. However, the franchisor should not be held liable unless it can be proven that it has central control over the day-to-day employment decisions of the subsidiary. I will assume that the franchisee is independently owned and the franchisor has no control over its labor relations and no control over it financial. In cases such as this, a critical component in determining liability is which entity made the employment decision of the person making the claim.
Factors that are considered in determining the existence of an illegal hostile work environment include: the conduct’s frequency, the conduct’s severity, any physical threat or humiliation (as opp...
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