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Home>HR>How You Can Protect Your Company From Employee and Customer Lawsuits?

How You Can Protect Your Company From Employee and Customer Lawsuits?

Posted on September 6, 2021 by Aaron

Running a business involves taking on a lot of risk. One of the biggest is the risk of litigation. Lawsuits can absolutely cripple a business. They can result in losses of thousands to millions of dollars and negative PR that can continue reverberating for decades. If you want to protect your business, you’re going to need to take steps to prevent the creation of lawsuits from both employees and customers.

Keep Everything in Writing and Store Records

Avoiding lawsuits can be quite difficult. However, you can certainly make it harder for the plaintiff by having access to documentation that refutes their claims. It may have become a trend in recent years for offices to go “paperless.” However, when it comes to documents that have legal implications, you should always create and store paper copies. This includes all signed agreements and contracts. This way, if something is questioned in a lawsuit, your lawyer will be able to reference the actual physical document in court that the plaintiff agreed to that clearly disputes their claims.

Adhere to OSHA Standards

While workers’ compensation insurance will help protect your company in certain situations, it will not protect you if a workplace is deemed unsafe. Instead, make sure your company adheres to all standards put in place by the Occupational Safety and Health Administration. Adhering to these standards will greatly lessen the risk for both your company and workers.

Perform Continual Audits for Litigation Risks

Oftentimes, a serious hazard is ignored for far too long before it actually causes an accident and results in a lawsuit. As such, you must be constantly auditing all levels of your company for litigation risks. Hire attorneys that are well versed in corporate law to help you audit your company from top to bottom for risks. This can include a strict examination of your business structure, conduct, and daily operations to ensure they all conform to the relevant legal code. Your facilities, including factories, stores, offices, and other areas, should be routinely examined for legal hazards.

Fine Tune Your Employment Practices

In regards to corporate law, one of the most common sources of litigation is poor employment practices. If it can be shown that you discriminate against specific protected groups in your hiring processes, you will likely end up being sued. The same can be said for how you promote, schedule, discipline, and fire employees. Have lawyers go over all your employment processes to ensure that they conform to the law. Keep accurate records in regards to everything concerning employees.

The risk of litigation is a huge one for businesses. If you end up being sued by an employee or customer, it can damage your entire organization and brand, and you may not be able to recover. However, if you take the proper precautions and make sure everything you do as a business is legally sound, you can greatly lower that risk.

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