According to EEOC charge statistics, complaints against employers increased from 75,428 in 2005 to 99,922 in 2010, an escalation of 32%. With the economy in a state of chaos, future tax rates a mystery, and employee healthcare costs skyrocketing, this should be no surprise. Businesses are being forced into drastic policy modifications minimizing pay rates, benefits, and the number of employees they can sustain on their payrolls.
With little to lose, employees are more willing than ever to take their chances with bias claims against their employers in an effort to secure their own financial positions. Inevitably, this has brewed into a perfect storm for an unprecedented level of lawsuits against businesses by their employees. No business is litigation proof, but there are a few steps all businesses can take to minimize the risk of litigation with employees, and abate potentially substantial financial loss.
First, it is important to make sure the business is properly incorporated to protect the owners or shareholders from personal liability resulting from business litigation. Second, the business must audit their payroll records to ensure all those working for them are afforded the correct employment status (full-time, part-time, independent contractor, etc…). Finally, businesses should assess their human resource policies and procedures for weaknesses in EEOC compliance and adjust accordingly to minimize the risk for potential business litigation.
The business climate in Arizona has been especially hard hit by this trend making it more important than ever for Arizona business owners to make sure they protect themselves from litigation in every way possible.