How to Stay Out of Legal Trouble With Employees



What kind of business do you want to be? If you want to do everything possible to be successful, including at the expense of your employees and your integrity, then you probably shouldn’t be in business. The fact is that the best way to stay out of legal trouble with your employees is to take the honest precautionary steps from the beginning.


Avoid Discrimination in Hiring

While it might seem simple on paper, avoiding discrimination can be tricky. A professional HR hire, contractor, or contracted HR company will have protocols and methods in place to avoid discrimination. If you plan to hire people yourself, you need to be aware of the potential pitfalls. Make sure to always focus primarily on a potential employee’s abilities and experience, and not on their race, gender, sexual orientation, or other factor outside of their control. In some fields, there may be an expected status quo for employees (e.g., in a male-dominated field like construction) where it may be hard for a typical employer to really look honestly at only a person’s abilities. Unconscious bias can also do a lot of damage. Consider having people apply with listing their race or gender.


Follow Wage Laws

You might think that following the law would be too obvious of a tip to put in an article about avoiding legal trouble… but you’d be wrong. Many, many businesses land themselves in hot water every year because of illegal activity. Whether committed intentionally, with the goal to cut financial corners, or committed in ignorance – it’s all the same to the government. You need to be aware of which laws apply to your business and how, in every conceivable aspect. That might be wages, or taxes, or insurance, but regardless, you need to be informed and committed to keeping them. Just to start - there are several taxes you need to pay when you employ someone at your business.


Communication, Honesty, and Keeping Records

The number one way to avoid employees becoming angry enough to sue you is to not give them any reason to. In the vast majority of cases, employees are not on the lookout to take advantage of a legally vulnerable business owner (although it can happen). Follow through on the benefits that you’ve promised your employees. Communicate clearly and honestly about wages. Keep careful financial and logistical records just in case somebody does try to sue you dishonestly.


Legal trouble is never fun for anybody, and the monetary drain can seriously damage your business. So, you need to be prepared from the beginning. Avoid discrimination. Follow all the legal and safety codes you need to, and you might not just avoid litigation – you might create a thriving company culture.


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