Recession-proof your HR practices
Sacramento, Calif. Today's struggling employers may soon feel as if they’re having salt poured on an open wound, as a jump in the number of employment claims and litigation is expected over the next few years. Why? In the plummeting economy, many companies have resorted to layoffs in order to quickly cut costs and, in their haste, may have unintentionally violated employment laws. Meanwhile, laid-off workers could file claims in retaliation or as a way to simply generate income in a tough job market.
“Research has shown that recessionary times are consistently associated with increases in employment-related litigation,” said Janine Yancey, CEO, emTRAiN, a Sacramento, Calif.-based provider of online human-resources compliance training. “EEOC claims are already starting to climb -- they’re up by more than 15% for 2008, the largest increase in more than 40 years.”
How can retailers ward off the expected onslaught? Yancey, a former labor and employment attorney, said the first step is to think like a plaintiff’s lawyer.
“Consider how every decision or action you take might be described in a courtroom by someone who has filed suit,” she said. “The key to avoiding claims is to have a legitimate business explanation and defined criteria for all employment decisions. Also, be sure that your documentation is adequate and that you’ve not inadvertently singled-out specific groups of workers.”
Yancey said employers should talk candidly with employees about difficult economic conditions; Doing so can actually defuse tension and reduce the toxic effects on morale that often lead to claims. Employers should also conduct an audit of documentation and record-retention systems and consider extending retention timelines.
Finally, proactive training is crucial. Yancey advised that all managers be well trained on discrimination, harassment, retaliation, ADA and FMLA, along with guidelines in hiring, employee management and termination.
“Effective education can prevent claims, as well as reduce the settlement value for those claims that do occur,” Yancey said.