RCS Business Ethics and Legal Compliance Flashcards
6 cards from real RCS practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 6 RCS Business Ethics and Legal Compliance flashcards as text
Which US tax form must a residential cleaning business issue to an independent contractor who earns $600 or more during the tax year?
Answer: Form 1099-NEC
Businesses must file Form 1099-NEC (Nonemployee Compensation) for any independent contractor paid $600 or more in a calendar year.
What is the primary legal risk of misclassifying a cleaning employee as an independent contractor?
Answer: Back taxes, penalties, and liability for unpaid wages and benefits owed to the worker
Misclassifying employees as contractors can result in significant IRS penalties, back payment of payroll taxes, and liability for unpaid overtime and benefits under the FLSA.
A cleaning business collects client home access codes and alarm PINs. Under ethical data handling practices, how should this information be stored?
Answer: Securely encrypted or locked with access restricted to authorized personnel only
Sensitive client security information must be stored using strong encryption or physical security measures with strict access controls to prevent unauthorized use.
Which practice best demonstrates ethical marketing for a residential cleaning business under FTC guidelines?
Answer: Using only genuine, verifiable client testimonials and making truthful claims about services
FTC guidelines require that advertising claims be truthful, substantiated, and non-deceptive, including that testimonials reflect genuine experiences of actual customers.
What must a residential cleaning company do before using a client's testimonial or before-and-after photos in its marketing materials?
Answer: Obtain written consent from the client authorizing the use of their feedback or images
Written consent protects the business legally and ensures clients are aware of and agree to how their personal information and home images are being used in marketing.
Which of the following is a key component of an ethical cancellation and refund policy for a residential cleaning service?
Answer: The policy must be clearly communicated to clients in writing before services begin
Ethical business practice requires that clients be informed of cancellation terms and refund conditions in advance so they can make fully informed decisions about the service agreement.