Employers face potential liability for any action committed by workers within the scope of employment. This opens the door to all types of claims against an employer, simply based on the actions of its employees. Employers can, however, mitigate this risk by putting a comprehensive infrastructure in place to govern acceptable employee conduct.
Defining the Scope of Employment
Potentially, anything that occurs at your workplace can result in liability. Did an employee accidentally step on the toe of a customer? The customer might sue your business for medical costs related to a broken toe. Did a waitress in your employ spill a drink on a customer’s iPhone? Your business could be liable for replacing the damaged device.
One way to limit the liability of your business is to define the scope of employment in your employee handbook. In short, this means that you should set rules that every employee must follow while they are working. For example, if you have a rule that your employees must wear a specific uniform, you could be safe from liability if they deviate from that uniform. Returning to the example where an employee stepped on the toe of a customer, assume that the reason the customer got hurt was that your employee was wearing steel-toed boots. If your employee handbook explicitly requires all employees to wear felt sneakers, that employee violated the rules. Had they not violated the rules, your customer never would have gotten injured.
The rules in your employee handbook should primarily be defined with risk in mind. An experienced Houston business attorney can help business owners identify those structures that will best protect their particular business.
An employee handbook should define what is expected of employees and what they aren’t allowed to do. This way, if an employee violates those precepts, the business can avoid liability for any consequences of that violation.
Protecting Yourself from Employee Disputes
Another way that an employee handbook can protect you is by defining the expectations of both your employees and your business. If an employee does something you don’t like, you have the right to fire them. However, if you never defined your expectations for employee behavior in writing, the employee may consider your actions to be a violation of their rights. This is especially true if you don’t provide them with a reason for why they were fired. Even if they lose their case, it will likely cost you thousands to defend yourself from a wrongful termination claim.
The easiest way to prevent these types of claims is to have well-defined rules regarding the behavior of employees — and then to clearly state what your company will do when those rules are violated. Surprisingly, you can also protect yourself from liability by granting your employees some protections as well, at least as long as you enforce those protections. Employees are less likely to file a lawsuit over employee disputes if they have previously received warnings or been given opportunities to resolve problems before they resulted in discipline.
Do you own a business that doesn’t have an employee handbook? Are you considering starting a new business from scratch? Contact an experienced employment law attorney at Weisblatt Law Firm today at (713) 666-1981 to discuss creating an employee handbook that will limit your liability.
Enforcing the Scope of Employment
To fully access the protections of a written employment policy, the employer must enforce that policy. In the above example about an employee stepping on a customer’s toe, the business would find it difficult to claim it wasn’t responsible if it didn’t send employees home or make them change their shoes when they violated the dress code. The employer, then, must put processes in place to enforce written employment policies. A human resources department can prove effective at achieving this goal. A small business that cannot hire a full-time or dedicated human resources officer still needs a manager or owner accountable for enforcing employment policies. An experienced attorney can help.
When creating written employment policies, consider the areas in which your business will face the greatest liability risks. Heavy machinery, dangerous chemicals, and company vehicles are frequent sources of workplace injuries. In an office environment, businesses may face liability for sexual harassment or discrimination claims. Carefully evaluate and consider all of these risks when drafting an employee handbook.
Enforcement has to be universal as well. It doesn’t matter if you enforce the rules for almost all of your employees. If you allow a specific employee to ignore a part of the employee handbook, you are opening yourself up to liability. Unequal enforcement can place you at greater risk than not having an employee handbook in the first place, making it likely that you will face an employment discrimination claim.
Finally, you aren’t unrestricted by the employee handbook. If anything, you are most tightly bound by it. It is the contract you have with your employees. If your handbook says, for example, that employees can call in sick up to three times a year, you can’t suddenly decide that you will only accept an employee’s calling in sick if they bring a note from a doctor. That would be changing the terms of the contract without informing the other party. Your actions would constitute a violation of the employment contract.
Protect Your Company’s Assets with Comprehensive Planning
Businesses—even limited liability companies—face liability in their daily operations. Luckily, comprehensive risk-management strategies and employee policies can mitigate these risks. For more than 25 years, Houston business owners have trusted attorney Andrew Weisblatt to shield them from liability and help them run their Texas businesses legally.
The Weisblatt Law Firm offers risk management and human resources consulting to businesses of all sizes. Protect your business from risk by hiring us to help you create an employee handbook that covers your needs. Call (713) 666-1981 or write us through our online contact form to schedule your free phone consultation with an experienced Texas business attorney today.
Attorney Andrew Weisblatt
Mr. Weisblatt has practiced continuously since becoming licensed in 1992 and has represented businesses ranging in size from one person start-up ventures to multi-national corporations employing hundreds of people in multiple countries. From 2005 through 2009 Mr. Weisblatt was in-house counsel and chief operating officer of a multi-national corporation in the steel products industry. That in-house position provided valuable insight into how businesses work and what they actually need from their lawyers – both in-house and outside counsel. Attorney Bio
