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EMPLOYMENT LITIGATION CONCERNS

Employment litigation is expensive and uncertain. How to react to a lawsuit being filed against you, especially for smaller businesses, is critical. You probably feel hurt by your former employee's accusations and think that you are being accused unjustly. But you are concerned about the risk of a bad result, the cost of even a successful defense, the time and attention that fighting the lawsuit will take away from your business. How do you balance it all out and make a sound business decision?

3 THINGS YOU MUST UNDERSTAND:

BE REALISTIC

Be sure that you understand the downside as well as the upside in pursuing further action.

BE OBJECTIVE

Hard as it may be, try to remove the emotion from your thinking and take a good hard look at what makes sound business sense. Depending upon the situation your options may range from going forward with full-bore litigation to opening discussions aimed at a quick settlement.

GET THE RIGHT LAWYER

Ahead of time if possible. Employment law is complex and ever-changing. You must be represented by someone who has a great deal of employment law experience. Having an established relationship with an employment lawyer who has had the opportunity to learn about you and your business over time will make for an efficient defense. Establishing the relationship before you have a problem is a good investment, and may help you avoid both problems and litigation expense.

TREAT YOUR EMPLOYEES WITH RESPECT:

It's hard to be a boss. You have to make tough decisions, sometimes unpleasant ones. Never forget that it's equally tough to be an employee and an ex-employee. Especially when you've made the difficult decision to let someone go, treat them with respect and compassion. We've seen lawsuits begun that would have been avoided if the employer had simply allowed the employee to retain her dignity upon the loss of a job.

3 THINGS YOU SHOULD DO:

BE HONEST

Be as honest as possible about the reasons for a termination. Don't tell a long term employee for the first time that she's doing a poor job. It makes people made, and justifiably so.

BE TIME SENSITIVE

Time a termination to avoid undue embarrassment to the departing employee.

BE RESPECTFUL

Do not have an employee “walked out” by security unless she presents a true security risk. There is little that is more humiliating, and even less that is so rarely appropriate.

THE DEVIL IS IN THE DETAILS:

It's a bother, but pay attention to the details. Rules and regulations can be an annoyance, but attending to them can save you time, money, and just possibly a loss in litigation. Having a working relationship with an employment lawyer can help you maintain proper adherence to rules and regulations.

3 THINGS YOU MUST DO:

DISSEMINATE INFORMATION

Keep your postings complete and current. You know all those required things that get hung in the lunch room but no one reads? Yes, those. Put someone in charge and make it happen.

STAY UP TO DATE

Speaking of complete and current, what kind of shape are your company's job descriptions in? If they're incomplete or don't reflect the growth in your business, get them updated.

HANDBOOKS ARE YOUR FRIEND

You spent good money on an employee handbook. Make sure it gets distributed to everyone. And make sure you have a written acknowledgement of receipt from everyone.

ALWAYS FOLLOW THE MONEY:

The “wages” of sin. How do you pay the people who work for you? Are you sure you're doing it right? It is imperative to follow all the rules and regulations in regards to compensation of your workforce.

3 THINGS YOU MUST DO:

CONTRACTORS

If you hire “contractors,” are you certain that they are truly contractors in the eyes of the law? They may really be employees, which has wage and tax ramifications. Making a mistake on this can be expensive. With new laws being proposed this area may become even more complex and onerous.  If in doubt, check it out.

OVERTIME

Do you pay overtime when non-exempt employees work more than 40 hours in a week? It can get tricky. Consider: if an employee works 40 hours each week for 2 weeks, for a total of 80 in a pay period, he gets regular pay. But if he works 80 hours in week 1 and zero in week 2, for the same total of 80, you owe him 40 hours paid at his regular rate and 40 at time and a half. If you don't the regulators will come knocking on your door. If you have any doubts, get it checked out.

AUDITS

If you receive a notice that you will be the subject of a Department of Labor audit, it's time to call your employment attorney. Not only should you get help with the audit for its own sake, but audits are often triggered by an employee's complaint. Audit aside, there may be trouble coming down the trail. Better to head it off at the pass.

BE PREPARED TO DEAL WITH WHATEVER ARISES

When bad things happen in the workplace they have a way of happening fast. When your HR person calls and says “we have a problem,” your immediate attention is needed. This kind of situation often arises when an employee complains that they have been sexually harassed.

3 THINGS YOU SHOULD DO:

ADDRESS THE SITUATION

Take every complaint seriously. Don't pre-judge one way or the other. Move quickly

ACT DECISIVELY

Don't punish the victim. Send the people involved to neutral corners. Consider putting the alleged offender out on leave.

INVESTIGATE

Who should conduct the investigation? This is a decision worthy of serious thought. It might be someone in HR – who has proper training, of course. It might be someone from outside the company, possibly an attorney or HR consultant, possibly even former law enforcement. Get good advice, designate or retain an investigator, and get it moving. It's important to your company's legal well-being.

HANDLING PERFORMANCE PROBLEMS

How do you handle a performance problem? Someone on your team isn't keeping up. You're worried. What can you do? How do you proceed?

3 THINGS YOU SHOULD DO:

IDENTIFY

Identify the problem and get it on the table with the employee, but don't make any promises.

CONSIDER COACHING

You might even consider placing the employee on a performance improvement plan (PIP). But be careful. Done correctly, a PIP can be a benefit to the company and the struggling employee. Done the wrong way it can be the evidence that a plaintiff's lawyer uses to beat you in court.

DOCUMENT EVERYTHING

Just as the three rules of real estate are “location, location, location,” the three rules of getting through difficulties with employees are “document, document, document.” Having a paper trail can greatly aid in your defense in any litigation. If you have questions about how to document incidents, give us a call and we can assist you.

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