In my experience as a litigator in California, I’ve found the following five issues to be the most effective way to reduce employment-related lawsuits:

1. Owner/president/CEO is present and available.

One of the single most effective factors in reducing employment lawsuits is if the company’s leader is present at the workplace and is available to speak with employees. Generally, this creates an atmosphere in which employees feel empowered to raise issues before they become a concern.

2. HR understands compliance and takes action.

I’ve said it many times before on this blog, HR needs to be way more than processing new employees and remembering employee’s birthdays. The HR function in a company is critical in reducing liability, and sets the culture for the company. Being compliant and taking action to investigate and correct any issues is a critical to preventing many lawsuits.

3. Managers are trained and understand when to involve upper management.

A well-trained front-line management team that knows when to involve the c-suite in any potential problems will also greatly reduce liability.

4. Culture of compliance.

Company must do the following:

  • maintain complainant and up-to-date policies
  • keep current on regular mandatory trainings (such as sexual harassment prevention training)
  • train front-line managers about wage and hour issues, when it is necessary to accommodate employees, and how to properly hiring employees (meaning how to legally and effectively conduct an interview).

5. Manager and upper management must have a culture of serving the employees.

Simply put: Don’t let your managers act like Steve Jobs. Unless your start-up has a huge backer and litigation budgets are not a concern, being a demanding manager that only says what is exactly on your mind when it comes into your mind may get good results, but it will also invite litigation. Don’t get me wrong, there is nothing illegal about being a demanding manager at work, but a lot of people probably don’t understand that. Also, over 20 states have proposed legislation to make bullying in the workplace illegal, but none of these attempts have become law – yet. Plus, even if the employee understands it is not illegal behavior, it creates an environment where the employee wants to get even with a manager or founder for how they were treated. This leads them to talk to a lawyer, which may lead to a lawsuit based on some other ground. Even if a lawsuit filed against a company is frivolous, it will take time and money away from what the company is supposed to be doing.