Don’t Let Workplace Lawsuits Put You out of Business, Part 1

If you’ve been in business any amount of time, you likely already know there’s nothing employers can necessarily do avoid lawsuits. In fact, you can do everything right and still get sued, so the goal to preventing workplace lawsuits from putting you out of business, is your ability to defend one, should you need to. Any time employers are required to defend themselves against allegations of wrongful conduct it costs money. However, the strength of your company’s HR practices can be the difference between a few thousand-dollars and a million.

Written Policies

Written HR policies are key to protecting you and your business from lawsuits. One of the most important policies an employer can have is an anti-harassment/anti-discrimination policy that includes reporting procedures. You may think it’s common sense for your employees to know they can’t harass other people, but that’s not enough. Having a written policy (and signed acknowledgement that all your employees have received it) can be a big part of your defense in the event a current or former employee initiates legal action against your company.

In defending unlawful harassment claims, employers can sometimes assert a defense, known as the Ellerth/Faragher Affirmative Defense (named after the two landmark cases that established this precedent). To use this defense, the employer must provide evidence that:

1. The employer exercised reasonable care to prevent and correct promptly any such harassment. This includes not only training, but also a comprehensive policy given to all employees (which you can prove because you have signed acknowledgement pages from everyone). The policy must detail:

• What constitutes unlawful harassment
• What employees should do if they witness or know of it taking place
• How managers will investigate it
• Who to report to (provide more than one option)

2. The employee unreasonably failed to take advantage of any preventative or corrective opportunities provided by the employer or to avoid harm otherwise. For example, an employee given the policy (acknowledged receipt and understanding), had four individuals to whom she could report the harassment, but failed to do so.

Plaintiffs can easily prevail in their claims if they can show the reason they didn’t report the harassment was because they didn’t know how (no policy). Without a policy that includes reporting procedures, the alleged victim doesn’t even have to prove any harassment took place. Therefore, it’s vital employers recognize the importance of having a clear anti-harassment policy with at least two alternative methods of reporting harassment, preferably one that includes a confidential, anonymous reporting method. Likewise, employers should understand the importance of ensuring employees are aware of the company’s anti-harassment policy, such as anti-harassment training and signed acknowledgements the employee read and understood the company’s harassment policy.

Not only is it important to have sound policies and practices in place, it’s imperative that you administer those policies and practices consistently. Along the way, make sure you keep track of any disciplinary incidents or actions taken by documenting them. We’ll have more on the importance of documentation and consistency in defending yourself against lawsuits in part two of this series.