COPPERPOINT

7 common ways to get sued by your employees

This article is Sponsored by

May 18, 2017, 3:32 PM | Updated: May 23, 2017, 11:13 am

...

If you had an 11 percent chance of winning the lottery, you’d probably feel pretty good about those odds and might even buy a few extra tickets. In 2014, U.S. companies had better than an 11 percent chance of being sued by a current or former employee, according to the 2015 Hiscox Guide to Employee Lawsuits.

For employment matters that end up in court, the median judgment is approximately $200,000 and about 25 percent of cases result in a judgment of $500,000 or more. Those costs are in addition to legal defense fees, explains Hiscox, the top underwriter of small business insurance in the U.S.

In spite of the relatively high risk of lawsuits and the costliness of litigation, many businesses fail to protect themselves with adequate insurance coverage.

While it is not always possible to avoid employee litigation, employers often put themselves at risk by acting inappropriately or by not complying with federal or state employment regulations. Here are some of the more common mistakes employers make that prompt lawsuits by disgruntled employees.

Being too kind

It’s tough to give bad reviews to an employee, so many supervisors try to spare workers’ feelings by providing mostly positive feedback. Unfortunately, if an employee is later terminated, he can point to those reviews as evidence the firing was unjustified.

Not following your policies

Employers who provide written guidelines and policies can get in trouble if they fail to adhere to them, explains Brent Gleeson in an article for Forbes. “You can have the best policies and training in the world — and indeed some companies have used that as a defense against a complaint. But you better be able to show that your supervisors followed those policies and applied the training.”

“You can have the best policies and training in the world — and indeed some companies have used that as a defense against a complaint. But you better be able to show that your supervisors followed those policies and applied the training.”

Illegal pre-employment questions

It’s illegal to discriminate against workers based on race, gender, nationality, religion, military status and age (40 and up). Employers who ask questions related to those topics put themselves at risk of a lawsuit. For example, it would not be legal to ask an obviously pregnant applicant about her due date, reports monster.com.

Rash discipline

When a worker violates a workplace policy, a supervisor sometimes reacts emotionally when taking disciplinary measures, according to hrdailyadvisor.com. In such cases, an employer should do a thorough investigation including, reviewing the employee’s file, gathering proof he received a copy of the policy violated and providing an opportunity for the employee to tell his side of the story.

Not paying overtime

Non-exempt employees “must receive overtime pay for hours worked over 40 in a workweek at a rate not less than time and one-half their regular rates of pay,” explains the U.S. Department of Labor. Even though it is federal law, some employers try to avoid paying overtime rates by improperly classifying employees, by changing workweek definitions or by trying to make some other type of payment arrangement with employees.

Firing errors

When a supervisor decides it is time for an employee to go, he often just wants to get it over with. Especially when dismissing someone for cause, a careful review process is essential. The worker’s deficiencies should be documented and the person doing the severance should not make any statements of apology, hrdailyadvisor.com notes.

Harassment

While sexual harassment gets most of the media attention, any type of workplace harassment is a violation of labor laws. The U.S. Equal Employment Commission reports harassment is illegal anytime it creates a hostile work environment. Furthermore, the harasser does not need to be in a supervisory role.

“The harasser can be … a supervisor in another area, a co-worker, or someone who is not an employee of the employer, such as a client or customer,” the commission states.

Prevention is the best defense against discrimination claims. Employers should follow proper practices for hiring, firing, anti-discrimination and harassment, etc. Even so, because of the frequency of litigation, any business is at risk even if everything is handled correctly. As a result, even small businesses should protect themselves against the risk of lawsuits by maintaining sufficient insurance coverage.

About CopperPoint: Founded in 1925, CopperPoint Insurance Companies is Arizona’s premier provider of workers compensation insurance. For over 90 years, CopperPoint has been a trusted partner for Arizona companies to protect what matters most: their businesses and employees. As a leading advocate of workplace safety, CopperPoint is proactive in building a culture of safety throughout Arizona and in keeping the state’s workers compensation insurance rates affordable. In doing so, CopperPoint delivers peace of mind to more than 12,000 businesses and their employees.

CopperPoint

...

Katie Nielsen, Brand Forge

4 ways to protect your company from cyber breaches

Cyber-attacks continue to plague organizations nationwide with more than 1,500 breaches reported in 2017. About 55 percent of them targeted businesses, but every industry sector experienced attacks including 24 percent in the healthcare industry, 8 percent in education, 8 percent in financial and about 5 percent in government and military, according to Statista.com. Breaches can […]

5 years ago

...

Bruce Trethewy from CopperPoint

Protecting your business from equipment breakdowns

When you run a business, an equipment failure resulting in lost productivity translates into lost revenue. Whether it’s a convenience store, a restaurant, a manufacturing plant, a construction site and any job in between, all kinds of equipment are used for everything from moving dirt to keeping food at the right temperature, from point-of-sales devices […]

5 years ago

...

C. Renee, BonnevillePhoenix.com Business Writer

The many ways umbrella insurance protects your business

Just as you wouldn’t want to get caught in the rain without cover, you wouldn’t want to find you don’t have enough coverage in the case of a liability claim against your business. The common theme here is an umbrella, and in the event of a liability claim or lawsuit, it’s better to have cover. […]

6 years ago

...

C.Renee BonnevillePhoenix.com Business Writer

5 ways to prevent embezzlement

Whether you’re running a small or large company, employee theft is one of the most prevalent types of theft in the country. In fact, according to a recent embezzlement study, 55 percent of employee theft happens to businesses with less than 500 employees with small and medium-sized businesses the most at risk. It’s important to […]

6 years ago

...

Bobbie Fox, Associate General Counsel for CopperPoint Insurance Companies

Fair Wages Act affects more than minimum wage for business owners

The Fair Wages and Healthy Families Act became effective July 1, 2017 and raised the minimum wage to $10 on January 1, 2017, and then incrementally, to $12 by 2020.

6 years ago

...

Katie Nielsen, Brandforge Business Writer

Small business data breaches reach all-time high

Cyberattack breaches are in the news a lot, but small businesses with comparatively few customers would hold little interest for hackers, right? Wrong.

6 years ago

7 common ways to get sued by your employees