Employment-related lawsuits are difficult to deal with: emotions run high with personal issues often brought into play. Even when claims are meritless, defense costs can be substantial. The impact on morale and reputation can also be significant. The following tips may help reduce employment-related issues in your business and strengthen your defense if an action is brought.

1. Invest in an Employee Handbook which Includes Employment-at-Will, Harassment and Discrimination Provisions

Every employer should invest in an Employee Handbook. While this may seem like an unnecessary expense, having policies in place that address termination of employment, discrimination and harassment can reduce potential exposure in employment-related matters. At a minimum, a handbook should include an employment-at-will statement and a zero tolerance policy toward discrimination and harassment. While sample policies are available, employers should ensure that all policies are compliant with applicable state and federal laws. Ideally, an employment attorney should draft and/or review the handbook.

Example: The COO maintained only one copy of a very old, out-of-date handbook that was no longer compliant with state or federal laws, and kept it in her office. The employees knew it was in the COO’s office and were not comfortable accessing it. When an employee filed a lawsuit, the handbook’s provisions were not enforced because they were (1) in conflict with the current law and (2) because it had not been disseminated to employees.

2. Ensure Consistency with a Uniform Review of all Adverse Employment Decisions

Consistency is essential in decisions involving adverse employment actions. A neutral party within your organization should review all such decisions to ensure that the emotional component is minimized, and that consequences of poor performance or misbehavior are being consistently evaluated.

Example: Two supervisors each had the ability to hire and fire employees on their respective teams. One strictly enforced attendance rules and terminated two employees who were late to work on three occasions. The other supervisor was more lax, allowing her team to arrive to work late or leave early. The terminated employees, who were both over the age of 40, filed suit alleging age discrimination, pointing out that many employees under 40 years old had also been tardy on several occasions, yet had not been terminated.

3. Train Employees on Employment-Related Issues

All employees should receive basic training on employment-related issues. Training options are available online and in-person, or you can opt for an attorney to perform training at your organization. Train supervisors to:

• Take every complaint seriously
• Immediately refer every complaint to HR or the designated employee, and investigate in a timely, thorough manner
• Be fair and consistent
• Document performance issues and be honest on performance evaluations
• Be vigilant to stop conduct that could draw allegations of discrimination or harassment

Train non-supervisory employees to understand:

• The process to file a harassment or discrimination complaint
• What types of behavior are unacceptable in the workplace
• The employer’s handbook and/or policies and procedures

Example: Every day, after business close, employees would stay to complete standard end-of-business day duties. This hour was typically filled with sexual banter among the employees. The manager was present, but never took steps to stop these conversations. A new employee was hired and terminated after only a few months when it became clear that she was not meeting required service standards. She filed a discrimination charge, claiming sexual harassment because of the sexual environment.

4. Document Everything

Employment claims often come down to one’s word against another’s. When an employer maintains detailed documentation created close in time to incidents in question, it’s a much stronger defense in any subsequent claims. Documentation should be clear, concise, free from emotion or unnecessary commentary, and include performance issues and the resulting consequences. Ideally, the employee should sign the documentation to acknowledge that issues were brought to his/her attention. Performance evaluations of all employees should be done, and done honestly. While it may be easier to simply give average or above average evaluations, it’s then difficult to defend any action by an employee where performance is relevant.

Example: A woman complained to the president that she was being sexually harassed by her supervisor. The president met with the supervisor who promised to stop. The president did not document the conversation. The behavior continued. Months later, the woman was terminated for performance issues. She alleged that she was fired in retaliation for complaining about sexual harassment. She had kept detailed notes and was able to establish that she had complained to the president. She alleged that he did nothing as a result and conspired with her supervisor to get rid of her. Since the president had no documentation of his meetings with the woman or her supervisor, her version of events was much more believable.

5. Watch Workplace Jokes and Banter

Most adults spend a huge chunk of their waking hours on the job and want to be able to enjoy relationships with their co-workers. While a collegial atmosphere is to be encouraged, it can quickly cross the line into actionable behavior. Consider the following comments: “Pregnant again? How many kids do you have?!”; “Your 50? Over the hill!”; “As an African-American, what do you think of Obama?”; “How was your vacation? Wish I could have seen you in a bikini!”; “We need to figure out how to attract Gen-X employees.” All were intended as harmless banter; however, they were used as evidence against an employer in a lawsuit brought by a former employee. Be vigilant in ensuring that employee interactions are professional and appropriate.

Example: A supervisor planned a 50th birthday party for an employee, including an “over the hill” banner, a black cake decorated with a tombstone and numerous age-related gag gifts. Shortly after the party, the employee was fired. He sued, alleging age discrimination, using the events at his birthday party as evidence of his supervisor’s discriminatory intent.

6. Recognize Pitfalls in Pre- and Post-Employment Time Frames

The interview process can be challenging as an employer attempts to gain information about prospective employees to determine whether they are suitable for a job. However, it is prohibited to ask about certain topics, like disability, age, children, marital status, etc., and illegal to make hiring decisions based on such information. Interviewers should focus on asking only work-appropriate questions. Once an employment relationship has ended, care must still be taken. Final paychecks and payment for accrued vacation time must be made in a timely manner based on state law. Calls for references should be handled by one person and dealt with in a consistent manner. No specifics regarding a termination should be discussed with other employees or customers.

Example: After an employee had been terminated for dishonest conduct, the employer received a reference call on the employee. The employer provided a detailed and extremely negative reference that resulted in a defamation lawsuit.

7. Regulate Internet and Email Use. In most workplaces, employees have email and internet access

Be vigilant that these tools are used in an appropriate manner. Have a policy prohibiting the access of pornographic or inappropriate websites and consider software that blocks inappropriate websites. Employees should be warned that emails are never truly deleted and that all email communication should be conducted in a professional manner.

Example: The CFO was engaged in a consensual affair with an employee, communicating multiple times a day via corporate email. When the employee broke off the affair, the CFO continued to email her constantly, begging her to come back. Months later, the employee applied for a promotion and did not get it. She quit and filed a lawsuit alleging sexual harassment and retaliation. Their thousands of emails figured prominently in the case.

8. Be Aware of Workplace Violence Issues

Unfortunately, workplace violence continues to occur. An employer must be vigilant and safety conscious, understanding that they have an obligation to provide a safe workplace and to take reasonable steps to ensure employee safety while on the job, especially in the event of a termination or other event that may cause anger on the part of an employee or even a customer. It may involve hiring security for the day or simply handling a termination privately with respect for the employee’s emotions.

Example: An employee who was a “cutter” would bring razor blades to work and, when stressed, would go into the bathroom to cut her skin. She told several co-workers, who informed management. Concerned with her bringing sharp objects to work which could be used as weapons, management warned her not to bring them to work and encouraged her to seek counseling. Days later, she was seen with a knife in the bathroom and terminated. She later filed suit for disability discrimination.

9. Review FLSA Status of Employees

The Fair Labor Standards Act requires that employees be properly categorized as exempt (paid a salary and not eligible for overtime pay) or nonexempt (paid by the hour and entitled to overtime pay if work is in excess of a certain number of hours per day or week). Failure to properly categorize jobs can lead to an employer being required to reimburse an employee or class of employees for unpaid overtime allegedly earned over a period of time.

Example: A group of employees file a lawsuit alleging that they had regularly worked in excess of 40 hours per week and were owed overtime pay.

10. Open Door Policy

A simple way to avoid employment-related problems is open and honest communication. Employees should feel comfortable approaching their employer to discuss employment-related issues. If managers truly have “open doors” to employees, many potential issues can be identified early and rectified before a true problem develops.

Example: A manager with a volatile personality rarely interacted with his staff. He instructed them to only interact with him by email and not to interrupt him in person with problems. An employee, diagnosed with cancer, needed accommodations to go to chemotherapy and doctor appointments. Uncomfortable with speaking with her manager, she didn’t inform him of her situation and missed many days of work. He terminated her and she sued for disability discrimination.