Business | Franchise | Employment | Litigation

Protecting Your Business From Wrongful Termination Lawsuits

It is until you step into the mindset of an entrepreneur or a business owner do you realize how many threats there are to your business. Litigation can devastate your business, and if you don’t have the right protections or  insurance such as (EPLI), you could allocate hundreds of thousands of dollars toward fighting it. Because you can mitigate many lawsuits but not outright eliminating them, you must focus your preemptive efforts appropriately. Some of the most common employment lawsuits result from discrimination, harassment, retaliation, and wrongful termination. Today, we will look at how to prevent your business from being exposed to wrongful termination lawsuits. 

The Value of Prevention

What is at stake? Saying that prevention is better than a cure is simple. There are $1000 solutions that could prevent $100,000 lawsuits. For example, people may need to pay more attention to how essential a basic yet comprehensive employee handbook is in protecting you and your business. Although money is a significant reason to avoid litigation, it isn’t the only thing at stake. You have to consider the degree of reputational damage it could create. When people read about what is happening in your company, how will it impact your relationship with customers, suppliers, and employees?

Lawsuits can foster a negative work environment for your employees and decrease their morale. Additionally, there are employment lawsuits that take years to work through. Instead of nurturing your business and focusing on your core operations, you must devote much time to developing a legal defense through your attorney. During this time, you may have to live with the stress that comes with the uncertainty of litigation. 

What To Do

When you are committed to minimizing your potential exposure to wrongful termination lawsuits, you can take deliberate steps to mitigate them. The first step is having clear policies that outline employee conduct, performance expectations, and termination procedures. Everything we have just mentioned needs to be in writing, and each employee should be able to access them. 

Although you must document your policies and procedures, you must maintain detailed records of each employee’s performance. What key performance indicators measure their contributions to your organization’s mission and purpose? How often are they met? If someone falls short of expectations, there needs to be disciplinary action (which should be identified in the policies and procedures your employees have read and have). Documenting your actions while following established guidelines helps you demonstrate and prove that the termination was lawful and for a legitimate business reason. 

Depending on the size of your company, the odds are that you, the owner, will not be conducting disciplinary actions. Your managers will. It is your responsibility to ensure that they understand how to handle performance issues and that their actions follow state and federal laws. For example, they and everyone else are your company and should understand all applicable laws and regulations. 

You should discuss the following with an attorney, but you can also offer severance packages to terminated employees. In exchange for the severance package, the employee signs a release of liability stating that they will not sue you for letting them go. 

Fortify Your Business 

The business law attorneys of Trembly Law Firm can help your business mitigate its potential for lawsuits, can defend you against one, or file one on your behalf. Regardless of your circumstances, we provide reliable and efficient legal services to find a resolution to your most complex legal issues. Contact our office today to schedule your consultation.

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