Avoid legal trouble with employees

Can you afford to ignore or mishandle employment problems? Definitely not. In addition to the negative effects on your business — declining morale, retention problems and poor productivity, to name a few — a botched employment situation can cost you millions of dollars if it turns into a lawsuit. Protect yourself using these common sense tips:

  1. Treat your workers with respect. Workers who are deprived of dignity, who are humiliated or who are treated in ways that are just plain mean are more likely to look for some revenge through the legal system — and juries are more likely to sympathize with them. For example, if you march fired workers off the premises under armed guard, publicize an employee’s personal problems or shame a worker in public for poor performance, you can expect trouble.
  2. Communicate with your workers. Adopt an open door policy and put it into practice. This will help you find out about workplace problems early on, when you can nip them in the bud. And it will show your employees that you value their opinions, an important component of positive employee relations.
  3. Be consistent. Apply the same standards of performance and conduct to all of your employees. Workers quickly sour on a boss playing favorites or punishing scapegoats. Successful discrimination lawsuits start when you treat workers in the same situation differently.
  4. Give regular evaluations. Performance evaluations are your early warning system regarding employment problems — and your proof that you acted reasonably if you end up in court. In the best situations, they can turn a poor performer into a valued worker. In the worst, evaluations can be valuable proof in a lawsuit, illustrating that you put a poor performer on notice and gave him a chance to improve. You can find detailed information about giving performance evaluations in Dealing With Problem Employees: A Legal Guide (Nolo).
  5. Make job-related decisions. Every workplace decision made should be guided by job-related criteria — not by a worker’s race or gender and not by a worker’s personal life or your personal biases. Making sure that your personnel decisions are business-related, make economic sense and will keep you out of lawsuits for discrimination, violation of privacy and wrongful termination.
  6. Don’t punish the messenger. Employers get in trouble when they discipline whistleblowers or workers who complain of harassment, discrimination or unsafe working conditions. Take action to deal with the problem itself, not with the employee who brought the problem to your attention.
  7. Adopt sound policies and follow them. An employee handbook is an indispensable workplace tool that can help you communicate with your employees, manage your workforce and protect your business from lawsuits. But once you adopt policies, you have to follow them. If you bend the rules, your workers won’t take them seriously. Some courts have found that employers who don’t follow the policies set out in their employee handbook or personnel manual might be on the hook for breach of contract.
  8. Keep good records. If a worker sues you, you’ll have to not only explain what happened, but also prove that your version of the story is accurate. To make your best case, keep careful records of every major employment decision or event with each worker — including evaluations, disciplinary warnings and reasons for firing.
  9. Take action when necessary. Once an employment problem comes to your attention, resist the temptation to hide your head in the sand. Take action quickly, before it turns into a real mess.
  10. Be discreet. Loose lips about employee problems are a surefire way to bring the law down upon your head. An employee could sue you for defamation — she could also haul you into court for causing her emotional distress, for creating a work environment that is hostile toward her or for poisoning prospective employers against her. The stakes are high, so protect yourself by giving information on a need-to-know basis only.

You can find more information on employee privacy rights and other workplace issues in The Manager’s Legal Handbook (Nolo).

– From: Nolo’s Legal Tips. Used with permission.