Tag: company policy

Is Your Business Litigation Proof?

The heading of this blog is a misnomer. There is no such thing as being litigation proof. Anyone can sue your business for any reason and meritorious or not, you will still have to defend the claim.

Still, there are many important steps a business can and should take to reduce its exposure and put itself in an advantageous position in the event a lawsuit is filed. Here are two simple actions that every business, large and small, should take in order to be a little bit more secure in today’s volatile world.

1. An Updated Employee Handbook

Employee handbooks set forth company policy for all employees to follow. Handbooks are useful reference materials that employees can rely upon to guide their day to day activities. They are also evidence of a company’s practices that can be introduced in the event of a lawsuit.

As a business grows, it should be mindful that different laws will apply to it. For example, once a business employs 15 employees, that business is now subject to the provisions of the Americans with Disabilities Act (“ADA”). Once that happens, an employee handbook should be modified to include language related to the reasonable accommodations that the business will make to comply with the ADA. If an employee with a disability were to file a claim under the ADA, a company with a handbook containing reasonable accommodation language would have a stronger argument that its practice is to comply with the ADA, than a company without such a policy in its handbook.

Also, business owners must be mindful that the law is constantly changing. For example, Illinois just enacted a law that requires an employee’s existing sick leave be granted to employees not only while they are sick, but also to care for sick family members (read more about that law here – http://lgattorneys.com/illinois-employee-sick-leave-act). Illinois businesses should amend their handbooks to reflect the change or discuss the pros and cons of moving away from sick leave/vacation time to paid time off that does not differentiate between sick leave and vacation time.

2. Record Retention Policy

If a company becomes involved in litigation, regardless of the issue, there is going to be a records request for all relevant documents in anyway related to the underlying lawsuit. This often involves emails and other electronic communications.

Having a records retention policy is important for several reasons. First, it ensures that all documents are kept for the optimal amount of time to conduct business without clogging servers or storage spaces. Second, it ensures that a company isn’t holding any documents for longer than legally required. Should a business be subject to a records request, a business is required to produce the documents in its possession. A plaintiff in a suit cannot use a document against you if you do not have it (and are not legally required to have kept it). Third, there are many record retention laws specific to different areas of business. A record retention policy can make sure a business does not violate the law by getting rid of documents too soon.

It is important that the business in question follow its policy universally and not on an ad hoc basis. As long as there is not a litigation hold in place requiring a company to keep all related records, then the company is free to follow its record retention policy without inadvertently destroying evidence and leading to a claim of evidence spoliation.

By consulting with an attorney and preparing an employee handbook and records retention policy, a business can take important first steps toward avoiding litigation, or at least being better placed to withstand a lawsuit if one comes its way.

For more information about developing an employee handbook or record retention policy appropriate for your business, please contact:

Robert Cooper at:

rcooper@lgattorneys.com or 312-368-0100.

Attention Employers and Employment Agencies: Criminal Records and Criminal Histories of Prospective Employees Off-Limits at Application Stage!

The Job Opportunities for Qualified Applicants Act (the “Act”), a new Illinois statute, will become effective January 1, 2015. The Act restricts employers and employment agencies from inquiring about or requiring the disclosure of an employment applicant’s criminal record or criminal history at the application stage, i.e., until the employer or employment agency has determined the applicant is qualified for the position and notified the applicant that he or she has been selected for an interview or, if there is not an interview, until after a conditional offer of employment is made to the applicant.

The Act defines an employer as any person or private entity that has 15 or more employees in the current or preceding year and employment agencies as any person or entity regularly undertaking, with or without compensation, to procure employees for an employer or to procure for employees opportunities to work for an employer.

The prohibition on inquiring into an applicant’s criminal record or criminal history at the application stage does not apply for positions where: (i) employers are required to exclude applicants with certain criminal convictions from employment due to federal or state law; (ii) a standard fidelity bond or an equivalent bond is required and an applicant’s conviction of one or more specified criminal offenses would disqualify the applicant from obtaining a bond; or (iii) employers employ individuals licensed under the Emergency Medical Services Systems Act.

Employers and employment agencies are allowed to notify applicants in writing of the specific offenses that will disqualify an applicant from employment in a particular position due to federal or state law, or the employer’s policy. Therefore, if an employer has a company policy which would disqualify an applicant from being hired based on specific offenses, the employer may notify applicants in writing of that fact.

Civil penalties that apply to employers or employment agencies that violate the Act range from a warning for the first violation to a civil penalty of up to $1,500 for every 30 days that passes without the employer’s or employment agency’s compliance with the Act.

In addition to the new rules under the Act, the ban against employers and employment agencies inquiring into or using an arrest record or expunged criminal history as a basis to refuse to hire remains in effect.

To review your business’ employment application and procedures or to review your business’ policies regarding specific offenses which may disqualify an applicant, or develop a notice letter to potential employees, please contact:

Morris R. Saunders at:

(312) 368-0100 / msaunders@lgattorneys.com

or

Mitchell S. Chaban at:

(312) 368-0100 / mchaban@lgattorneys.com

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