Nine Simple Steps to Avoid Employment Lawsuits
You’re striving to operate as efficiently as possible to increase your company’s profit margin. But then someone in the company steps on a legal landmine and you spend $50,000.00 to win a lawsuit. If you fight and win or lose, you could spend $150,000.00 or more, even on a weak case. You CAN take steps to prevent this scenario. Here are nine of them.
• Make Reporting Complaints Easier. The earlier you learn of an employee’s complaint, the better. You can’t fix a problem you don’t know about. Providing more than one option for employees to complain ensures that they can bring legitimate issues to management’s attention and that a supervisor cannot hide issues from upper management.
• Timeliness. Be proactive. Once you learn of a problem, you have to respond. The company’s response will obviously depend on the problem, but understand that the response – or lack thereof – will be scrutinized. Simply documenting the issue may be enough. Other times, an investigation that results in disciplinary action will be necessary.
• Document Performance Deficiencies. In this day and age, you must document everything. But performance problems and conduct violations are more important than other issues. If you want to discourage a lawsuit, make sure the employee you just fired for performance issues has already been written up at least twice.
•Don’t Make Exceptions. A big part of being perceived as a fair employer is consistent application of the rules. When you make an exception for one employee, you alienate the others. So, consistent application of policies regarding promotions, vacation, pay, assignments, awards, discipline, and termination is the only way to go.
• Train Your Front Line. Who needs it the most? Whoever interacts with employees more than any other level of management in your company? Front-line managers. They handle the daytoday gripes that, if not handled properly, become lawsuits. Train them to spot issues, to be proactive, and to be consistent.
• Make Your Handbook a Tool, Not a Stumbling Block. An employee handbook is a tool that communicates a company’s expectations to its employees. It should include statements addressing at-will employment; equal employment and harassment issues; work hours; leave and accommodation under the FMLA and the ADA; workplace violence; trade secrets and confidentiality of information; work rules and the consequences for violating them; and other important issues., including the latest cascade of employment regulations created in NYC.
• Terminate Slowly. The decision to terminate someone’s employment should at least (1) be reviewed by more than one manager, (2) involve someone with Human Resources training, and (3) be well documented. If you are unsure of important facts or someone is not available to review the decision, suspend the employee and wait. Get counsel. A rush to judgment can be expensive.
• Consider Severance Agreements. Sometimes paying a small amount early is smart. A severance agreement usually results in the company paying an employee a few weeks (or even months) of salary in exchange for the employee releasing all claims against the company. If done correctly, this eliminates the chance of a lawsuit. If a mistake has been made, it often saves the company money.
• What Would a Jury Say? Think about how a jury would decide the justice of your termination. Unless you are sure a jury could decide in your favor, give the employee another chance.
