Defending Your Business from Employment Litigation

It’s all about prevention

Defending your company from employment related litigation is not only expensive; it can be a huge distraction from running a business. While employers can’t change the laws, they can put themselves in a position to defend themselves and make sure that events that occurred can be articulated forcefully and accurately. While facts will be different in each case, there are some common documents are critical in almost every employment related legal dispute.

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Critical Employment Related Documents

  • Employment Application
  • Employee Handbooks
  • Job Descriptions
  • Performance Evaluations
  • Disciplinary Warnings
  • Response to Administrative Claims.

According to D. Albert Brannen at Labor Lawyers, these six documents “are almost always included among the documents requested and produced in employment litigation”. While not the only areas of risk, without these documents and employer is defenseless in employment litigation.

Creating Base Line Employment Documents
For a starting point, employers must create these documents for their company and also make sure the documents themselves are legal. Rules for what employers can and cannot do or ask are changing all the time and it is critical to update them as required. For example on the employment application there are new rules (2014) about asking applications about prior arrests. Employee handbooks now need to have rules for social media policies that do not violate and encroach on “protected activities” and the Department of Labor. Simply finding a form on the internet and using that as a template for your companies documents could be an expensive mistake. Written job descriptions are critical when conducting performance evaluations.race

Document Maintenance
Next on the list is ensuring that each document is complete and accurate for each employee. This requires a consistent ongoing effort. Just creating the forms is worthless in a litigation defense if they were never completed and filed. In addition employers need to track and obtain acknowledgments from the employee that they have been provided, read and understand the information in the documents.

Consistent Treatment Among Employees
It is also key to ensure that your documents maintenance is consistent among employees. A sure way to weaken a litigation defense is for a plaintiff to be able to demonstrate that they were “singled out” for some other reason. This is especially critical if the litigant is member of a “protected class” who may be making a discrimination claim. Consistent effort across the workforce is required if they defendant hopes to show the claims are unfounded.

What Options Does an Employer Have?

Do it Your Self
Most entrepreneurs and small business owners are by nature do it yourself kinds of people. That can be a trap. Employment laws are changing all the time and in many cases are unique in different states. Ensuring your documents and processes are legal, up to date and consistent is a big job by itself. Most business owners are not willing to put the time and energy into doing it correctly and consistently. Unfortunately when they find out (in legal fees, civil judgments or regulatory fines), it will be an expensive mistake.

Hire a Labor Lawyer and Internal HR Expert
To get started, a labor law firm probably has template forms that are up to date and cover lots of legal contingencies. However document maintenance will demand someone in the company with an HR background ensure that these documents are consistently prepared, completed and communicated to employees. This route is expensive and most small business cannot justify the expenditure for a full time HR expert.

Hire a Professional Employer Organization (PEO)
PEOs are in business help other businesses navigate the minefields of employer related risks. Companies that join a PEO get:

  • Access to a full suite of up to date and legal current employment forms
  • Access to Human Resources experts to customize a maintenance plan for their company
  • Legal advice and risk sharing should employment related litigation arise
  • Staff training programs for managers and owners
  • Access to Employment Practices Liability Insurance (EPLI) to mitigate the financial risk for (some) employment practices.

 

For business owners, joining a Professional Employer Organization ensures employer related risk are reduced and HR best practices make a better place to work. Investigate PEO solutions for your company now.

 

Image courtesy of dan4th Nicholas via Flickr