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Small Business Employment Lawsuits: Being Informed and Preparred

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This is a blog about REAL questions with REAL answers from REAL people for REAL business owners and professionals.  How many times have you had questions about payroll or just business or tax questions in general, but couldn't figure out exactly what to ask or who to ask it to?  I hope it's comforting to know you're not the only one this happens to!  I felt the same way in the beginning, many  years ago.  It's actually what drove me to this profession in 1984!  Now, after decades of helping thousands of people, just like you, I'm writing this blog to help YOU!  So dig in - see if some of our questions and answers put words to your thoughts.  We're here to help - so reach out to us with your every-day challenges and we'll create a post just for you!

REAL questions with

REAL answers from

REAL people for

REAL business owners

Preventing Employment Lawsuits

What type of lawsuits are typically brought to a small business? A 2014 Equal Employment Opportunity Commission (EEOC) review states the percentage of each complain varies by category. The following are the top 10 categories of charges filed with the EEOC:

 

1. Retaliation under all statutes: 37,955 (42.8 percent of all charges filed)

2. Race (including racial harassment): 31,073 (35 percent)

3. Sex (including pregnancy and sexual harassment): 26,027 (29.3 percent)

4. Disability: 25,369 (28.6 percent)

5. Age: 20,588 (23.2 percent)

6. National Origin: 9,579 (10.8 percent)

7. Religion: 3,549 (4.0 percent)

8. Color: 2,756 (3.1 percent)

9. Equal Pay Act: 938 (1.1 percent) but note that sex-based wage discrimination can also be charged under Title VII’s sex discrimination provision

10. Genetic Information Non-Discrimination Act: 333 (0.4 percent)

 

This adds up to more than 100% due to some charges allege multiple bases, such as discrimination on the bases of race and color, or sex and retaliation.

 

“Hiscox USA claims data for small and mid-sized businesses (under 500 employees) indicate that one in five will face employment charges with an average cost to defend of $125,000, which includes expenses such as attorney’s fees and settlement costs. For those that did have insurance coverage, the average deductible cost was only $35,000, compared to the $90,000 balance paid out by their insurance company.” https://www.insurancejournal.com/news/national/2015/10/28/386321.htm

 

The best way to avoid ever seeing an employment lawsuit is prevention. Preventative measures such as written hiring procedures, keeping the employee handbook up-to-date, employee training on workplace harassment and discrimination and clear cut consequences for rule breakers are the best way to protect your business and minimize your risk of entering into a lawsuit.

 

Find out more about our Services and Who We Are. Make this the best decision of your day.

At Payroll Vault, we want to be an extension of your business team. 

We're available, accessible and affordable.  Reach out today.

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Published on:

April 04, 2019

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