How To Avoid Employment Practices Lawsuits

Thousands of small business owners just like you open themselves up to lawsuits because of unlawful employment practices and hiring policies.

Plain liability insurance may not be enough, which is why they make employment practices liability insurance.

Employment Practices Liability

Federal law restricts making employment decisions based on any of the following:

  • Race
  • National origin
  • Religion
  • Creed
  • Gender
  • Age
  • Disability

Some of these laws depend on the size of your company and the number of your employees. For example, the restrictions on race, religion, gender, and disability apply to businesses with 15 or more employees. Furthermore, the restrictions on age apply to businesses with 20 or more employees.

Here is the thing: you can’t plead ignorance with these issues. Pleading that you didn’t know that showing prejudice or sexually harassing someone was unlawful isn’t going to work! All it takes to destroy you and your business is an employee who feels discriminated against. They could sue your company based on extreme emotional distress or wrongful termination.

How do you know if you are violating someones civil rights?

You need employment practices training! Did you know that the Equal Employment Opportunity Commission (EEOC), has affordable training materials just for small businesses like yours?

Hiring practices and liability avoidance

So let’s say you are personally committed to diversity and a safe work environment for all at your business. But, what happens if you hire someone that isn’t? You are opening yourself up to a lot of trouble!

What can you do?

  1. You need a reasonable screening process for all new hires to prevent you from exposing yourself to negligent hiring liability.
  2. Check references
  3. Check their social media pages

Remember the odds are that immature, careless and irresponsible people are much more likely to engage in risky behaviors, such as:

  • Reckless driving with company vehicles
  • Sexual harassment and teasing
  • Cutting corners with safety rules that could lead to injury or death
  • Employee theft
  • Illegal drug use
  • Irresponsible drinking and alcohol addiction

Set up clear job descriptions and workplace rules

Make sure all employees have these and have signed copies in their files. Avoid favoritism like the plague. Make sure that all rules are fairly enforced with every employee. Document all coaching sessions and disciplinary sessions.

All of these things combined can go a long way in minimizing the risk of unacceptable behavior. The professionals at InsuranceHub are standing by to help you in any way we can with insuring your business. Call for a free quote right now or fill out our quote form to get started.

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