For 10 years, I’ve been writing a column for this paper simplifying the complex legal issues of being an employer in the Panhandle of Texas. Each January, I offer several New Year’s resolutions. Not for me, of course, but resolutions for business owners, supervisors and other employers to change a few bad habits and protect yourselves from employee lawsuits.
Most of the resolutions I suggest arise from legal issues that my clients have faced all year and questions that come up repeatedly in the corporate training that I do on employment issues.
Some bad employer practices, like poor documentation, have to be addressed every year. Being an optimist, I think that if I keep writing about it, someday you employers will change your ways and start protecting yourselves by writing down the disciplinary issues you discuss with your employees.
One of my clients laughed when I told him this and said, “But my bad habits keep you in business”. While I am always grateful for the work, there really are enough employment problems around to keep me busy without you as an employer repeating avoidable mistakes.
So just humor me and consider making these changes in your business in 2007:
- Get a written electronic document retention policy in place. Effective December 1, 2006, a new federal rule of civil procedure required employers involved in an employment lawsuit very early in the litigation to provide to the opposing counsel all electronic documents, such as e-mails, that might possibly be relevant to the lawsuit. Once you have reason to anticipate litigation, through a threatening letter from the employee’s attorney, for example, you must show that you retained and can easily access all electronic data. The court can impose sanctions if you obstruct this process in any way. Conversely, in your daily conduct of business, you want to have a way to consistently delete electronic documents and paper documents that are outdated for reasons of business necessity, such as cost of storage. Therefore, you need to take time in 2007 to work with your IT people to find a way to meet both of these goals.
- Train your staff in the dangers of misusing e-mail. Employees often fail to understand that the business computer network, instant messaging and e-mail systems generate business records that can be used against the company in litigation. Those “funny” chain e-mails, dirty cartoons and racially derogatory jokes that get circulated through the company network are not only inappropriate, but also dangerous for the company if a lawsuit is filed. Your employees need to hear again that the company technology is for business purposes only and that hitting the delete button does not actually destroy all records of the document.
- Consider what will happen if an employee is injured. Many of you do not carry worker’s compensation insurance because the premiums are so high. But companies that do not carry this insurance are heavily penalized if an employee gets injured and sues the company. The employer is prohibited from asserting certain significant defenses in court, including blaming the employee for carelessly causing his own injury. The result often becomes that the employer pays as much if not more for defending the case in court and paying monetary damages to the injured worker than the company ever would have paid for worker’s compensation insurance premiums. At a minimum, discuss your decision to forego worker’s compensation insurance with your employment attorney so that you clearly understand your risks.
- Be very cautious about firing older people. Age discrimination cases are the most costly employment claims for employers. If you are terminating the employment of a long-term employee who is over the age of 40 and you replace that person with a substantially younger worker, you may be setting yourself up for an age discrimination lawsuit. This is why documentation is so important. You need to be able to show in writing that there were serious performance or disciplinary problems with this employee and that you gave the employee an opportunity to cure his mistakes. You may also need to show that other older workers remain in your employ. And by all means, protect yourself by resisting the temptation to ever say, “We need some new blood around here”, or “That other guy sure is a young gun” or any other careless comment that smacks of age bias.
- Quit believing that you are running a “family” firm. Your company is a business, not a family. Usually I hear, “Our staff is just like a family” from the employer who doesn’t adopt written policies, fails to institute any formal rules or take the time to carefully clarify expectations. Generally, the employer is using being a “family” as an excuse to be passive, tolerant and non-confrontational. Your employees deserve some “tough love” from you, including written requirements for attendance, vacations, sick leave, drug-free workplaces, grievances, discipline and other employment issues. Putting some time and effort into these policies can stop many problems before they start and allow employees the freedom to work responsibly within those boundaries.