Many companies reserve risk management for outside sources like vendors and customers when detrimental lawsuits can be internal. Ignored and mishandled personnel issues that turn intolitigations can become costly setbacks. Mitigate your firm’s risks while protecting your finances and reputation by adopting the following smart business practices.
Disrespected crewmembers may seek legal revenge against your company if anyone deprives them of their dignity, humiliates them, or treats them poorly. In courts, juries tend to sympathize with mistreated workers.
Your firm could invite retribution by shaming personnel publicly for inferior performance, spreading staffers’ personal struggles, or enlisting armed guards to escort fired employees from your property. Managers who deal with everyone fairly and politely with equal respect can avoid lawsuits while boosting workforce morale.
Adopt and maintain a gracious open-door policy. That will help supervisors discover employment concerns early, when they are easiest to resolve. Leaders who listen and inform staffers about job-related issues show that management values everyone’s opinions, a key component for positive workforce relations. Transparent practices and two-way dialogues will minimize the chances of misunderstandings turning into lawsuits.
Staffers distrust superiors who play favorites or punish scapegoats. Workforce morale will plummet if crewmembers see that executives do not hold everyone to systematic rules. Discrimination complaints are successful when bosses treat employees in comparable situations differently. So apply uniform job performance and personal conduct standards to all team members at all levels.
Performance reviews can serve as early-warning signals, indicating impending employment problems. Ideally, they turn poor performers into valued workers. However, disgruntled staffers might claim evaluations constituted unfair treatment in lawsuits. So deliver unfavorable assessments to potential troublemakers before witnesses. Their objective perspectives may be beneficial if employees take legal actions.
Use job-related facts — not workers’ races/genders/private lives or personal biases — to guide all personnel decisions. Besides making economic sense, that habit will help managers avoid discrimination, wrongful termination, and privacy violation lawsuits.
Troubles may arise if you punish whistleblowers or employees who reported unsafe workplace conditions, discrimination, or harassment. Address underlying issues, not crewmembers who bring them to management’s attention.
Spreading rumors and gossiping about staffers’ problems are surefire ways to provoke them into involving the legal system. They may sue your firm for defamation, emotional distress, poisoning your well of prospective recruits, or your hostile work environment. Avoid such undesirable situations with protective measures such as sharing just the specific facts crucial to job performance at required times only.
Your employee handbook, an essential workplace tool, will convey key information to and manage crewmembers while protecting your company from lawsuits. All staffers should sign acknowledgements that they have read and understand your documented policies. After adopting regulations, following and enforcing them consistently is vital. Bend your rules, and personnel will quit taking them seriously. Even worse, workers can sue you for practices that differ from published directives.
An employee set a precedent by filing a breach of contract suit when his employer did not follow handbook compensation and benefit policies. The appeals court ruling proclaimed that the firm’s manual was an implied but binding employment agreement. A disclaimer stipulating that it was not a contract would have helped the proprietor prevail in the courtroom. In addition, a provision indicating that company procedures are subject to changes at the employer’s sole discretion could limit legal liability further.
National PEO can create a basic or custom employee handbook outlining your firm’s workforce regulations and guidelines. Our experts will coordinate with you and conduct research to include all applicable industry standards and mandatory compliance notices. Review your manual regularly to request updates as needed to stay current.
If workers sue your organization, you must recall and describe what transpired and prove why your account is the accurate one. That requires keeping vigilant, dated files on all major employee incidents and decisions including performance reviews, disciplinary warning forms, and firing reasons. Delaying record creation until staffers file internal complaints or lawsuits will harm your credibility. Instead, document events contemporaneously, which is around the times they occur.
Once you become aware of employment problems, resist the impulse to ignore concerns until them go away. Take quick action, or minor issues can evolve into worse predicaments or expensive legal battles.Back to blog list