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Practices to Protect Your Small Business from Employee Lawsuits

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Practices to Protect Your Small Business from Employee Lawsuits

By jdelung, Contributor
Published: December 18, 2013 Updated: December 18, 2013

Getting sued by current or former employees happens more often than you might think. In fact, the number of lawsuits filed regarding wage-and-hour laws alone in 2011 went up 32 percent from just three years prior. Don’t be too busy to check in and ensure you aren’t breaking laws or otherwise opening yourself up to a potential lawsuit — no small business owner has the time, or money, for that.

There’s a plethora of advice out there on the subject of protecting your business from lawsuits. Before you read on, remember, you should always consult your legal counsel to ensure you are complying with federal and state laws. Laws regarding certain practices, such as non-compete agreements, vary widely from state to state.

Information and resources on avoiding legal trouble

We’ve compiled a list of some of the most helpful tips from around the Web.

When in doubt, consult your legal counsel. However, by taking some preventative measures, you could avoid legal issues before they start.

About the Author:

Joshua DeLung


I am an author for the the Community. I write about useful topics for your entrepreneurial endeavors and help point you in the right direction to find other resources for your small business needs. Our ongoing goal is to improve this site to meet your needs, so we're happy to receive your feedback and participation. Thanks for joining our online Community here at!


Good group of resources. Small businesses are especially at-risk for employment litigation because they usually lack legal counsel and management with experience dealing with employment legal issues. Very easy to do the wrong thing when you don't have the resources available to deal with those problems.
Communication is key. It is always better to work through any issue before a lawsuit even comes to mind. A complete understanding between the employer and employee should consistently be a priority.
Very informative post as how small business can be saved from employee Lawsuits. A vigilant approach can always help a group to counter any negative approach, which can play spoilsport to any kind of business. The above point are very important to take a note of.
I read your article so many times. It is really nice for protect our small business from employees lawsuit. I forwarded this information to my friends who engaged in small business. I think it’s helpful for this type of problem. Thank you so much.
Some good tips. The only sure-fire way to prevent employee lawsuits is to keep your business small enough to where you don't need any employees.
goon70056: But if your company is too small, there will be little opportunity to develop. :)
Very true. But if one is happy keeping their business small...
A bunch of employees that left a company I worked for sued for discrimination. I guess it can happen anywhere.

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