Best Practices For Avoiding Labor Lawsuits

Avoiding Labor LawsuitsYou’ve worked hard to build your business’s good reputation. However, your reputation can become tarnished seemingly overnight if you find yourself involved in a labor lawsuit, whether knowingly or unknowingly. In today’s litigious society, many workers have no qualms about going after their employers for even the most minor infractions of labor laws by suing them.

So, how do you avoid becoming one of the growing numbers of businesses that falls victim to a labor lawsuit that could tarnish your hard-earned reputation and destroy your business? First, you need to be on your guard by minimizing any compliance risks that could lead to you being on the wrong side of the law. We recommend that you consider the following suggestions to minimize your risks:

Understand Federal and State Labor Laws

Labor laws may be constantly changing, but you need to perform your due diligence in understanding how they apply to your specific business. This means understanding both Federal and State labor laws, which can be a time-consuming process for one individual. Therefore, it’s a good idea to form a committee within your organization comprised of representatives from management and your employees.

Forming a committee of this nature will show that your company is committed to maintaining regulation compliance. The main purpose of this compliance committee is to review existing and incoming labor laws and settle on a unified stance in interpreting these laws and how they apply to your business.


You will want to make sure that your compliance committee documents everything, preferably electronically to a central repository designated for policies and procedures. This will allow the information to be traceable and communicated in the most effective and consistent way.

By following this route, you will help eliminate confusion and define the standards that are expected from all departments. Once again, this step also shows that your company is committed to complying with labor regulations.

Training for Management and Employees

The next step is for the committee to determine what training is needed for management and employees so that they fully understand and comply with labor regulations; i.e. complying with wage and hour regulations or satisfying safety training requirements.

Part of this process is determining how this training will be delivered and what information is to be provided to employees according to their level within the company; i.e. promoted employees and new hires.

Proper documentation is also vital to this process. Documentation of the training provided and documentation that the employee understands the training they have been supplied with and are committed to following your company’s compliance policy is important.

Monitor Compliance

After training has been completed, it’s important that you keep tabs on whether these policies and procedures are effectively implemented. Controls need to be put in place to ensure that all employees are complying with these plans; i.e. employees are clocking in and out for meal breaks to provide proof of compliance with break requirements.

Audit and Identify Deficiencies

By analyzing the data collected through the controls that you implement, you will be able to identify areas in which compliance efforts are deficient. A tracking system can be utilized to provide managers with real-time alerts and provide reports that show deviation patterns. This information is also valuable for documenting when employees have neglected to do their part in complying if the matter goes before regulators.

Take Corrective Action

With the information obtained through auditing, management can then take steps toward correcting employee(s) deviations from complying with labor laws. This includes notifying employee(s) of the infraction, documenting what corrective actions need to be taken and continued documented follow-ups to ensure the problem is resolved. Once again, this documentation is important to prove to regulators that you have taken efforts to ensure compliance.

How We Can Help

As you can see, trying to remain in compliance with labor laws can be a time-consuming and exhaustive process. However, we can help you in avoiding labor lawsuits without having to go through many hassles. Construction Labor Contractors specializes in providing construction staffing to the building industry. We constantly review current and proposed labor law regulations and provide training for the skilled labor your organization needs. Your company’s risks are reduced because the labor staffing we provide to your company are our employees, thus relieving you of many of the responsibilities of maintaining your own staff.

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