At Vision, we follow the trends in litigation of employee claims in order to assess the overall exposure of our Solution Center members. The rule of thumb is that litigation over terminations moves inversely to the health of the economy, and that latest data prove the rule. In good times, employers who overlook the need for employment policies and procedures can often escape suit. Not true in recessionary times.

     After falling by 3%-4% each year for the last decade, discrimination charges filed with the U.S. Equal Employment Opportunity Commission spiked 15% in 2008. This tracks with court cases filed outside the EEOC system. A jump of this magnitude is dramatic, and we expect it to continue to rise until well after the economy begins recovering.

     There are two primary drivers of employment suits – both hinging on money. In good times, an employee fired for what she believes to be unfair or discriminatory treatment will most often quickly find another job. She will put the bad events behind her and move on. However, in bad times, as she remains unemployed, she will definitely be inclined to seek out a lawyer.

     Here’s where the second money issues comes in. First, lawyers are businesspeople, too. If they believe they can’t make money on a case, they will not take it. When people are out of work for a long time, or have to take a job at a much lower rate of pay, the damages begin to add up, and the cases look better. Second, lawyers are also under economic stress. Other areas of practice are drying up. They are looking for areas that have potential. With more terminated employees out there, wrongful termination cases look better and better.

     The lesson? Look closely at your policies. Now is the time to document termination decisions so that your practice or business is not one of those hit with a suit.

Many professional practices and other small businesses give staff and family member discounts on products and services. In medical practices, dental practices and veterinary practices, to name only three service-related businesses, the doctors often carry balances for employees that are not paid with any regularity.

Unfortunately, without a specific policy on this practice, the doctor can be left holding the bag – literally – if the employee suddenly quits. It is worse when the doctor must terminate the employee, and learns in the process that there is several hundred dollars owing.

We’ve seen this issue in several practices lately. Usually we find out this is happening when the doctor calls and asks us if it is okay for him or her to deduct the balance from the employee’s final paycheck. Sometimes, of course, even that paycheck doesn’t cover the balance.

The unfortunate response we have to give is “no” – unless the doctor obtained an authorization to deduct the money before the decision was made to terminate or separate the employee. It is always possible – but unlikely – that the employee who is informed she is being fired will agree to have the money deducted.

It is really important to have each employee, as part of the hiring process, sign an authorization that allows the owner to deduct amounts owing both during, and at the termination of, the employment. By having a policy that specifies what percentage of any outstanding balance will be deducted from paychecks, you can assure that the balance never gets out of hand.

At Vision, we are dedicated to getting out the message that small employers –- professionals, especially – need not stumble from one employee-related crisis to another. My name is Mike Moore and I’ve spent thirty years dealing with employment issues in litigation.

What I learned a long time ago was that big corporations have access to specialized human resources tools – including access to the labor law departments of the big law firms they retain. Small employers, on the other hand, have been unable to access that kind of support because they either could not find the right support or it was too costly.

Vision HR Solutions is my brainchild. And it was created to be responsive to small business and professional practice needs.

In this blog, we will address specific issues that may impact a small business, we’ll talk about court cases that may affect you, and a whole range of other topics that we hope will be enlightening.

So, on with the blog!