Business lawsuits can arise for a myriad of reasons, and this topic has been discussed in detail on our blog. Lawsuits which involve staff members are often especially tricky and there may be so much at stake. Not only do business owners have to worry about the financial penalties associated with these suits, but the outcome of a case involving an employee (or a group of employees) could influence other workers’ decisions in different ways. Sometimes, additional staff members may decide to take legal action following a co-worker’s lawsuit. As a result, it is crucial for business owners to prevent these lawsuits, when possible.

Whether your business is accused of wrongdoing involving overtime, non-payment of wages or other wage and hour violations, or someone who works for your company is considering legal action over allegations of racial discrimination or sexual harassment, the consequences of an employee’s lawsuit can be very damaging. In some instances, you may be able to clear up the misunderstanding and avoid a lawsuit by discussing the issue(s) with staff members. Unfortunately, communication does not always work, and litigation may be unavoidable.

These lawsuits can greatly affect your business’ reputation, and they may have an impact on other workers’ views regarding your company. For example, a worker who successfully files suit against an employer (or former employer) may inspire other workers to file suit or decide to work for another company in the wake of the allegations. Correctly handling business lawsuits involving workers is especially important because of these concerns.