 Legal constraints for employee and consumer rights – examples of the legal

constraints.

Legal constraints cover the following area of employment practices:

- Recruitment, employment contracts and termination of employment
- Health and safety at work
- Minimum wage (lowest wage permitted by law or by special agreement)
CONSTRAITS:
- higher cost - supervisory cost (for recruitment), paid holidays, paid leave, leave,
stricter health and safety laws.
Benefits:
- secured workers => more motivated - safe environment => prevent time off work -
avoids expensive court cases / fines - attract best employees
Consumer Protection Law:
Why protected? : - Imported goods should follow standard
- Competitive markets => taking advantage of customers
Examples: Goods must be fit to sell, safe and no defect. Goods must perform in the way
described.
Benefits:
Complying will lead to: - reducing risks leading to bad publicity - reduce risk for court action -
improved customer loyalty - good reputation for honesty

 Understand multinational businesses and their impact to host-countries.

Multinational businesses have operations in more than one country. This means they have an
established base for either producing or selling products outside their own domestic economy.

Impacts to host countries:

Good= - Employment opportunities

- Tax revenues
- Economy output increases (GDP)
- Local managers and supervisors may replace foreign supervisors one qualified, meaning
growth!
Bad= - Exploitation of local workers

- Local business may be out of business from competition

- Imposing culture (loss of culture identity)

 Understand social influence and social audit.

CSR is when a business accepts its legal and moral obligations to all stakeholders, not just investors.