Common Reasons Why Employees Sue (& How to Protect Your Business)

Safeguard Your Business Against Lawsuits

Business owners can employ large workforces to small teams of people. However, if employees have felt that they have been wronged in any way, they usually take action against your company. In this litigious society, a business can never be too careful. As with most things in life, the best way to handle such a situation is to be prepared. More and more businesses are gaining coverage to protect their reputation, finances, and further damage from such lawsuits.

Below are the top 5 reasons why employees sue your company (and how to protect your company!)

  1. Not giving a reason for firing. If you’re an at-will employee, you can fire at will, right? Wrong! Most employees think that they’re great workers, and if they get fired for an unbeknown reason, they’ll make up their own reason – or their lawyer will. The reason for termination needs to be clear, and documented.
  2. Firing an employee for a bad performance when the employee has good performance reviews. In contrast to the above situation, supervisors need to understand that they’ll need a performance paper trail if they want to fire someone.
  3. Bad timing. An example of this is when an employee files an internal complaint about the employer or a supervisor, and then is disciplined for an unrelated event. Employees who file complaints can, of course, be disciplined, but the supervisor better have the documentation in order before making the move.
  4. Out of control greed. For example, if the owner of the company drives a brand-new sports car but tells an employee that the company cannot afford to give him a raise from $10 an hour to $10.15. Should that employee get fired, they’ll likely call a lawyer for this unjust work environment.
  5. Failing to follow policies. You can have the best policies and training there is, but supervisors must be able to show that they followed these policies and applied the training.
  6. Uniform Discipline Structure. Not executing all discipline in a uniform manner will usually result in an employee discrimination suit. If one employee is being disciplined for always being late or absent and your “favorite workers” are not, this is grounds for a lawsuit.

To prevent the possibility of your company’s bottom line suffering, be sure to put these prevention tips into place. In addition, safeguard your business, should it fall victim to such attacks with reliable commercial insuranceContact Lou Aggetta Insurance Services today in Pleasant Hill, California.