How to Avoid the Dreaded Lawsuit

Lawsuits are an unwelcome guest in any household not to mention in any business; no one wants to be sued! Unfortunately, lawsuits surrounding the workplace are on the rise. Compensation issues, discrimination complaints as well as wrongful termination suits were all in abundance in 2010. For example, in 2010 wage and hour lawsuits under the Fair Labor Standards Act jumped dramatically, adding 700 more cases than in 2009 totaling 6,800 lawsuits.

Other areas contributing to an increased number of lawsuits are disability and leave of absence claims. Requests for disability accommodation as well as for a leave of absence are on a dramatic upswing. Employers are now seeing work-related injury claims stemming from physical or emotional ailments that don’t stem from the job but affect it. Denial of such claims can lead to a lawsuit under the Fair Labor Standards Act. The issue appears to be finding a balance between what legal right the employee has versus what legal right the employer has; the two rights often overlap.

What is causing this increase? Some point to the increased activism by the Obama administration in both discrimination and wage and hour claims. In 2010, the U.S. Department of Labor hired around 200 additional field investigators to strengthen its enforcement efforts. In fact, a number of complaints made surrounding the heightened investigation claim that federal agencies are turning what used to be small, resolvable workplace matters into full-scale investigations. How can the problem be solved? Better yet, how can lawsuits be avoided?

1. First of all, keep open lines of communication between all departments and employees. Full disclosure regarding wages and salaries, over-time pay and leave of absence policies will keep everyone in the office informed of their rights.

2. Provide outlets for counseling and dispute resolution within your business. Employees and employers alike should have an outlet in which they can air their grievances without feeling threatened.

3. Ensure hiring procedures are in place and employees are appropriately classified.

4. Don’t retaliate against employees for complaining. The majority of claims filed with the Equal Opportunity Commission include a form of retaliation.

5. Finally, treat everyone equally and fairly. Employees who feel valued are not only happier, they will perform more efficiently and accurately.

Lawsuits are intimidating. However, they can often be avoided. Keep the above five tips in mind to increase productivity in the office and to create a happier, lawsuit free environment. Learn more ways MyCorporation can help you maintain your business HERE!