One Angry Employee, Two Very Different Outcomes

alternate dispute resolution

One angry employee can bring your business to its’ knees!

But our one-of-a-kind Alternate Dispute Resolution (ADR) program is a true game changer!

The employer/employee relationship can be volatile. Things don’t always go as planned. Sometimes employees get angry at employers (usually after being fired). Sometimes they decide to sue. It’s never something you expect to actually happen, but it can and the outcomes can be very financially devastating for your business.

See also: Alternative Dispute Resolution Services

We have THE secret weapon for our clients that may prove to be the smartest tool you’ve ever put in your tool-belt as a business owner.

Put yourself in this real world example and decide which outcome you would choose?

One Angry Employee and…

You are forced to fire an employee and they are very angry about it.  So now your ex-employee is sitting at home all day watching Judge Judy. A commercial plays on their TV from an attorney who states “If you’ve been wrongfully terminated or injured in the workplace, just call me. If I don’t recover for you, you don’t pay.”  These are known as “Contingency Attorneys” as they agree to work for a percentage of whatever they recover for their clients; usually 50%.

So now you have an angry ex-employee thinking about calling this “free” attorney to go after you.  Read on and make your choice.  How you will protect yourself.

Protection Option 1: You have Employers Practice Liability Insurance or “EPLI”

Let’s say you add Employers Practice Liability Insurance or “EPLI” to your General Liability policy. Here’s how that will work in our scenario above…

You will get a letter from the attorney stating that their client (the ex-employee) has been wrongfully terminated and they intend to sue you to the fullest extent of the law.  You now face a potential nightmare. You are being threatened with a trial in court and the verdict of a jury.

These letters strike fear into the hearts of the business owner — and they should.  In most cases, the employer has done absolutely nothing wrong, but that doesn’t matter.  Litigious employees can go after their employer for ANY reason, valid or not.

So now you face the uncertainty of what lies ahead.  Will they be dragged into court? What kind of Jury will they get?  What kind of Judge?  Will the Jury award the Plaintiff a “Jackpot” award as is often seen in employment law cases?   While the Jury awards are always a complete unknown, the average defense cost alone for these kinds of lawsuits is $125,000.  Again, even when the employer has done nothing wrong!  And this process can take 6-18 months or more!

But remember, you have Employer Practice Liability Insurance (EPLI) policy to protect you from damages caused by this lawsuit. The trouble is, EPLI will do nothing to prevent lawsuits from happening. These products exist simply as insurance to help cover your damages only after you’re lawsuit is over…

The cold reality of these situations is that once an employee or ex-employee gets a lawyer and threatens to sue you; you have no choice but to defend yourself.  Also worthy of note is that this entire process is part of the public record.  Anyone can read about it. This situation puts a huge target on your back and you must find a way to manage this risk.

Protection Option 2: You are protected by Employers Resources’ Alternate Dispute Resolution Program

Now consider the same situation with Alternate Dispute Resolution (ADR) in place.

  • Your angry terminated employee get’s a lawyer and the lawyer sends you the same “nasty gram” letter threatening to sue.
  • You send the letter to your Employers Resource HR department.  They then send the lawyer a copy of the Alternate Dispute Resolution agreement (provided by Employers Resource) the employee signed when they came to work for you.
  • The lawyer immediately knows that his key tool, the threat of the courtroom, is OFF THE TABLE!
  • The grievance can ONLY be settled via Mediation and Arbitration, period.
  • For the vast majority of situations, the threat is OVER.  The attorney knows that without the threat of the courtroom, the chance of recovering a settlement is virtually gone. They withdraw from the case and move on.

The power of this cannot be overstated.

ADR is the Employer’s Secret Weapon for Liability Protection

alternate dispute resolution 2

ADR is an agreement between you and each of your employees.  This agreement stipulates that your employees and you agree that ANY and ALL employment related disputes are to be resolved via the process of Mediation and if needed, Binding Arbitration. For longer than any PEO in America Employers Resource has protected its clients with Mediation and Arbitration also known as Alternate Dispute Resolution (ADR). For many of our clients, this program has proven to be one of the most powerful tools we provide.

More specifically, by signing this agreement, your employee is totally waiving their right to sue you in a court of law.  Common examples of workplace disputes include Sexual Harassment, Wrongful Termination, Discrimination, etc.

***Note that if an employee is truly wrongfully terminated or subjected to sexual harassment or otherwise discriminated against, they can and will recover damages in the ADR process. So, it is very fair to honest employees who have been harmed, but in reality, this is quite a rare occurrence.  It’s the frivolous lawsuit from an angry employee or ex-employee that is your real exposure. ***

The Risk is Real and You Must do Something About it – Protect Yourself Today

As consultants helping business owners understand your business and the risks you face, frivolous lawsuits must be part of the conversation.  You may not want to hear it, but hiding your head in the sand is no strategy. This is one of the single biggest threats you face and the risk is growing every day.

These dangers are real and we have the proven tool to protect you from it. Don’t let an angry employee threaten your dream, your business.  We fight to protect your dream and ADR is one of our most powerful tools to accomplish this.

Don’t let one angry employee threaten your dream. Here’s a secret weapon.

What do you think the chances are that your home will burn down?  Pretty small right?  So even though this risk is quite small, would you go for a single moment without fire insurance on your home?  According to the Equal Employment Opportunity Commission’s (EEOC), each year, any given employer faces a 1 in 66 chance of being sued by an employee.  How can you go another moment not protecting yourself from this much greater risk?

Maybe you’re saying, “I have EPLI for that”. As you learned earlier, EPLI only helps offset some of your cost after the drawn out process of a threatened lawsuit is over.  It does nothing to prevent or shorten the process.  ADR settles these disputes in a matter of days or weeks and eliminates lawsuits before they even get started.

Employers Resource is one of only a few PEO’s in America that offer ADR.  And fewer still offer a program like ours that is compliant with the Federal Arbitration Act which ensures no state law can undermine the program.

Make sure your business is protected and talk to us about our unique and powerful ADR tool today.

0 replies

Leave a Reply

Want to join the discussion?
Feel free to contribute!

Leave a Reply

Your email address will not be published.