Many things happen throughout the day that threaten your sanity, poke at your happiness and to your stress level. Don’t let the possibility of getting sued be one of those things. As a small business owner receiving a notice of intent to sue can potentially demolish your business. It extracts money from your business and takes time away from the attention you give to your business.
Separating personal emotions from how you handle business and how your employees approach business is a necessity. As a business owner you must take the proper precautions prior to hiring to protect your business. When you set the tone for the needs of business in the beginning your employees won’t be blind sided with your business need requests and other last minute changes.
Here are 4 highlights of your business to prevent your company from being sued.
- Defamation Lawsuits – In the event you fire an employee, it is best to limit any information given to a new potential employer. If the information is not factual or cannot be proven, do not mention it. Your personal issue with that person should not be conversed with the new company. That kind of behavior can result in a lawsuit against you for defamation of character. Not only are you defaming your ex-employee’s character, you’re causing a loss of wages. Then, you will be looking at steep legal fees and charges. You don’t want that.
- Improper Firing – Enlist the assistance of a lawyer to assist with your organization’s policies and procedures. Be sure to maintain up-to-date documentation on each employee. In the event you have to suspend or terminate one of your employees, you will need a paper trail of that employee’s inability to fulfill their work requirements and how they breached their contractual obligations to your firm.
- Vacation Policy– Prior to employment, you must create a clearly written vacation policy. This document should outline every facet that explains how time off is handled with your organization. For example, if you intend on setting a “use it or lose it” policy, you must make sure employees are aware ahead of time; employees need to informed 12 months prior to when the changes will occur. There can also be costly legal fees associated with a lawsuit over lost wages and/or money lost for a vacation that was paid for that was not able to be taken because the employee could not get off work. Be as transparent as possible. Open communication makes for a functioning employee/employer relationship.
- Harmed on the Job– Sexual harassment, physical altercations and any abuse are unacceptable on the job. The work environment needs to be safe. Employees need to know if anything creates an uncomfortable environment that they can go to someone for help. If your employees feel offended by the work environment or components within the environment, they need a “safe haven” to seek assistance. This can be a HR department or outsourced service. Harassment cases are expensive lawsuits, you want to avoid them at all costs.
There are limitless reasons for lawsuits. In business, you want to protect yourself as much as possible. Consult with an experienced business attorney. Get contracts, disclaimers, policy and procedures and any other notices implemented for you and your business’ protection. Make sure to have all employees up-to-date. Maintaining detailed notes on meetings, coaching, warning and writes up will protect you in the case of a lawsuit.
The U.S. Equal Employment Opportunity Commission is a great start on implementing the correct guidelines. You can also check out the Small Business Administration for more ways to protect your business.