Being sued by an employee can be a business owner’s worst nightmare, costing a significant amount of money and wasting your valuable time. However, you can potentially avoid this risk if you follow a few simple practices and avoid the common errors below.
Lack of Employee Handbook:
This is the easiest problem to fix, but many employers still do not have a handbook or manual containing the policies and procedures of the company. This is not as important if under 10 employees but is an absolute must if 25 or more employees.
Lack of Adequate Anti-Discrimination Policies:
Be sure you understand all the applicable laws, and genuinely practice an open minded and non-discriminatory approach to hiring and promotions. Without anti-discrimination policies that adequately address ALL employees, you leave yourself wide open for a lawsuit.
Insufficient or Inaccurate Performance Evaluations:
From probationary assessments to yearly reviews of your employees, reliable and accurate evaluations must be completed to accomplish three objectives: (1) legal compliance and documentation; (2) administrative uses and (3) developmental uses.
Insufficient or Erroneous Documentation of Personnel Decisions:
We’ve all heard the saying “If it is not documented, it did not happen”. Even if an employee was warned about his or her actions, behavior or performance on multiple occasions, once an employee files a lawsuit the employer is exposed if there is inadequate record keeping.
Lack of Adequate Investigation Procedures:
Courts have repeatedly admonished business owners for not conducting an objective investigation in the instance of a complaint of discrimination, harassment or retaliation. As such, it has become a HUGE issue in litigation. It is imperative that you now the laws and procedures in terms of who should conduct the investigation, when it should be conducted, and how it should be conducted.
Failure to Apply Company Policies/Procedures in a Uniform Manner:
Often times, disgruntled employees file charges with the authorities simply because they feel they have been treated differently than their coworkers in terms of enforcement of policies and procedures. As a result, you, as a business owner, are forced to spend unnecessary funds defending a claim that could easily have been avoided. Do not pick favorites to whom the rules do not apply – this breeds contempt among other employees.
Inadequate Response to Initial Claim:
In many cases, handling a claim properly and in a timely manner can eliminate the hassle and risk of any future potential lawsuits. When the response is not appropriate, increased damages in a subsequent lawsuit are possible.
Understanding and having comprehensive policies and procedures in place and access to competent legal assistance can go a long way to help you and your business avoid the nightmare of a lawsuit.
Having access to competent, reliable legal assistance can also help you save time, money and stress. Therefore, if you are a business owner, we encourage you to reach out to our firm at any time to discuss your growing business needs.
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