Terry Masonry is a small company that has both part and full-time employees and exclusively uses a manual payroll system. Employees can elect to purchase health insurance on their own using employer compensation or can choose the company's no cost health insurance. The company recently hired a few on-call employees. The on-call employees determine where they work, as well as how many hours they work. A year ago, the company was recently accused of unequal pay practices.

Required: Use the scenario above to answer each of the following questions. Each answer should be a minimum of a paragraph in length.

1. Using the Fair Labor Standards Act (FLSA) as a guide, what should the company consider concerning working hours?

2. Joe Smith was terminated from Terry Masonry and while employed he chose to receive employer compensation and purchase his own health insurance. What must the company do in regard to COBRA?

3. Terry Masonry's Chief Financial Officer (CFO) wants to update the payroll system. The company owner wants the CFO to conduct research and provide him with a report with available options. If you were the CFO, what would you report to the owner?

4. The company's accounting manager is having trouble determining the on-call employee's employment status. What criteria would you tell the accounting manager to use to make this determination? Please provide a minimum of two criteria.