Top 10 Things Employers Do to Get Sued

Posted by on April 7, 2011 at 6:09 pm.
  1. “My Company is too small to be sued in a wage and hour class action suit!”
    1. Wage and Hour laws are governed by the FLSA which covers minimum wage, state labor laws, wage garnishments, record keeping requirements and overtime.
    2. All businesses, big or small, are governed by the Wage and Hour laws.
  2. “I can’t afford to hire an attorney to review my policies and give advice on what policies I should have.”
    1. Businesses do not need to hire an attorney to develop and/or implement their policies.
    2. An HR professional (at a 1/3 of the cost of an attorney) can assist your organization with the development of HR policies and procedures.
  3. “My employees don’t need me to tell them when to take a rest and meal break.  My employees are adults and know when they can take a break whenever they want.”
    1. Per the Wage and Hour law, employees’ are entitled to a half hour meal break for every work day of more than five hours worked.
    2. For every four-hour work period, employees’ are entitled to a paid ten-minute rest period.
  4. “My current Employee Handbook is fine….
    1. I found it on the internet;
    2. The previous company I worked for used it;
    3. I had my attorney review it when I founded the company in 2001;
    4. My friend owns a business in the same industry and gave me a copy of her handbook.”
  5. Employers hold the employee’s final paycheck until he/she turns in the company cell phone and/or uniform.  After all, it was agreed to in writing to turn them in.  Seems reasonable, perfectly fair especially since you have an agreement.
    1. Final paycheck deadlines depend on whether the employee was terminated, laid off, quit with or without at least 72 hours notice.
    2. Terminated or laid off employees are entitled to final wages upon last day.
    3. Quit with fewer than 72 hours notice, the employer has 72 hours after when notice was given.
  6. Don’t waste time training front-line supervisors on employment laws.  After all, that is what the company pays the HR people to handle.
    1. Supervisors are the eyes and ears of the organization.  Training this level is your first line of protection from lawsuits.
    2. Supervisors can be named individually in a lawsuit.  They need to be informed.
  7. Congratulate the employee who passes the “90-day” probationary period.  Let him/her know that he/she is now a permanentemployee.
    1. Under Nevada Law, the employment relationship is presumed to be “at-will”.
    2. Either party can terminate the employment relationship with or without a reason.
    3. Using the term permanent can imply the employer no longer has a right to terminate the employee without just cause.
    4. A better term to use is regular employee.
  8. Pay everyone a salary.  Payroll is so much easier without having to calculate overtime.
    1. Under both federal and state laws, certain employees are exempt from overtime requirements and some aren’t.
    2. Other employees who don’t qualify for an exemption are entitled to overtime pay, and can’t agree to forego overtime pay in exchange for receiving a salary.
  9. During a down-sizing, layoff the older employee first; he/she is going to retire soon anyway!
    1. This can be viewed as a discrimination issue!
    2. Plan layoffs by reviewing the employees who are being considered for layoff carefully.
    3. Decide if you plan on layoffs based on performance, seniority or a combination of the two.
  10. I am too busy to think about employee law issues.  I will deal with it when, and if, something happens.
    1. Don’t be reactive.  This can be costly as compared to being proactive.

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