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Common Reasons Why Employees Sue & How to Protect Your Business!

Common Reasons Why Employees Sue & How to Protect Your Business!

Protecting your business from disgruntled employees is essential to growth and success.

Every business is responsible for upholding their employees to a certain standard. In this day-n-age, team members need to understand how to meet goals, how to improve, and when to check in with management.

In the ever-evolving litigious society, should an employee feel that they were wronged in some way, when they are terminated, they can lash back in the form of a lawsuit.

Below are the top 4 reasons why employees sue companies (and how to protect your business!):

Not providing a reason for termination. 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 a mysterious reason, they’ll make up their own reason – or their lawyer will. The reason for termination needs to be clear.

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. Without written warnings and a host of good reviews at hand, your case will not be strong.

Poor 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.

Out of control greed. For example, the owner of a company drives a brand new Ferrari but tells an employee that the company cannot afford to give him a raise from $9 an hour to $9.15. Should that employee get fired, they’ll likely call a lawyer for this unjust work environment.

Fortunately, commercial insurance can mitigate the costs, should your business be slapped with a lawsuit. Businesses can ensure that your HR and legal teams are doing their best to provide the proper protection and training, and secure your business with reliable commercial insurance for time and cost help defending your business.

For a quality insurance policy for your business, contact the Insurance Agency of Dean Davis, located in Austin, Texas!