Workforce issues can put a business out of existence faster than anything else.
A termination gone wrong. A harassment claim that you wish you’d handled differently. A wage and hour dispute that you weren’t prepared to manage. This is just a sampling of the types of issues that occur on a daily basis for business owners who thought they had things under control.
The fact of the matter is…
Most businesses don’t realize that they need legal help until it’s too late. By the time a business owner recognizes that they should have called for help… the damage has been done.
The good news is that there are certain warning signs that can help a business owner spot problems early and get the help that they need before it’s too late. Educating yourself on when it makes sense to retain employment law services can save a business thousands of dollars and numerous headaches.
We’ll cover:
- Why Workforce Issues Are Increasing
- Signs Every Business Owner Needs to Know
- When Employment Law Services Are Appropriate
- How Working with Employment Law Experts Protects Your Bottom Line
Why Workforce Issues Are Increasing
Workplace disputes are happening with increasing frequency. In fact, statistics show that 2024 was another year with record-setting workplace disputes.
The Equal Employment Opportunity Commission (EEOC) recently released its 2024 Performance and Annual Report. The report shows an increase in charges of workplace discrimination of over 9% from the prior year.
Here’s the catch…
Employee rights are at the forefront of employees’ minds right now. Employees understand more than ever what illegal treatment is. They know where to file a complaint. They’re not afraid to take action.
Because of this shift, businesses need to be more informed than ever when it comes to the workforce issues that can arise. Working with experienced and qualified Employment Law Attorneys before issues occur is one of the smartest decisions that a business can make. The cost of prevention is always less than the cost of litigation.
When it comes to employment litigation, flying blind is simply not an option for a business.
Signs Every Business Owner Needs to Know
Not every workforce issue needs the attention of an attorney. There are certainly some situations where a business owner needs to handle a situation without legal help. It is important, however, to recognize the warning signs that scream “hire a lawyer now.”
Warning Signs That a Business Owner Needs to Know
- Termination Decisions You Feel Nervous About – Terminating an employee is never a situation that a business owner wants to be in. There are some terminations that carry more risk than others. A recent complaint by the employee. A request for medical leave. Safety concerns or whistleblowing. These are all situations where a termination could be perceived as retaliation. Retaliation claims are exploding right now. They account for nearly half of all the charges that the EEOC is receiving. One termination that is not properly documented can become a six-figure lawsuit.
- Harassment Complaints – When an employee makes a harassment complaint, the clock starts ticking on a business’s response. The first hours and days are critical. A proper investigation must be conducted. Documentation must be rock solid. The response must be measured and appropriate. A single misstep and a business can find itself on the line for failing to take action.
- Wage and Hour Disputes – Overtime. Meal breaks. Misclassified contractors. These are all issues that seem to start small but can quickly turn into class action lawsuits. Once one employee starts asking questions, a business can find itself with a lawsuit that represents dozens of current and former employees. The financial exposure in these types of lawsuits can be enormous.
- Policy Changes or Compliance Updates – Employment laws change constantly. Federal rules. State requirements. Local ordinances. The list goes on and on. Trying to keep up with every change to employment law is nearly impossible without assistance. An outdated employee handbook or non-compliant policy can quickly turn into a lawsuit against a business. Legal reviews are no longer optional. They are necessary.
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When Employment Law Services Make Sense
There are businesses that bring in lawyers too late and those that bring in lawyers too early and spend money that they do not need to spend. So when does it make sense for a business to reach out for legal assistance?
- Prior to Making a Major Decision – Any business decision that has an impact on an employee’s job status needs to be double-checked. Terminations, demotions, performance improvement plans, layoffs. All of these types of actions come with legal risk. A short consultation with legal counsel to discuss the situation is an easy and effective way to uncover problems that may not be obvious.
- As Complaints Begin to Accumulate – A single employee complaint may be nothing more than a disgruntled employee. Two or three complaints against the same manager or policy, however, is a pattern. Patterns like this are more likely to catch the attention of regulators and plaintiff’s attorneys. Getting ahead of these issues with legal help can prevent them from turning into something much larger.
- During Periods of Growth – Growth brings risk. The more employees a business has, the more legal exposure it will have. In addition to this risk, a business crossing certain employee thresholds can trigger additional compliance requirements. Businesses that are in growth mode need to have legal infrastructure in place to handle the new risk that comes with growth. Employment policies, training programs, and complaint procedures all need to be revisited as the business scales.
- After Receiving a Legal Notice – A demand letter. An EEOC charge. A lawsuit. These types of legal documents require immediate professional attention. Responding incorrectly to legal notices can make an already bad situation much worse. The response itself becomes evidence that will be used against a business. Retaining legal help at this stage is no longer optional.
How Legal Expertise Protects Your Bottom Line
Legal fees seem like a lot of money until compared to the alternative. One report by Business Wire estimates that 37% of small businesses were the subject of an employee lawsuit in 2024. In other words, more than one third of businesses had an employee lawsuit brought against them this year. The chances of a business getting hit with a lawsuit are much higher than most business owners think.
Employee lawsuits can cost a small business quickly. The defense of an employment lawsuit can easily cost between $75,000 and $125,000, not including any settlement or judgment that might be required at the end of the case.
Startling, isn’t it?
Legal expertise helps in three primary ways:
- Prevention – Catching problems before they turn into lawsuits
- Documentation – Building a record of information to support the business if claims arise
- Response – Handling complaints and charges the correct way from the beginning
Businesses that proactively invest in employment law services are the ones that never see the massive payouts. They have better policies, better training, and better documentation. If a dispute arises, they are in a much stronger position to defend themselves.
Wrapping Things Up
Workforce issues aren’t going away anytime soon. The legal environment for businesses is getting more complex every year. Employees are more willing than ever to file claims when they feel that they have been wronged.
Smart business owners don’t wait for a problem to find them. They build relationships with employment law professionals before things get sideways. They seek advice when faced with tough decisions. They invest in being compliant before regulators start knocking on their door.
The cost of getting it right upfront is a fraction of the cost of cleaning up a mess afterwards.
Every business with employees has legal exposure. The only question is whether a business owner will address the issue now or pay for it later.
