It’s impossible to say exactly how many lawsuits are filed in the US each year, but figures published by the University of Denver suggest it could be as high as 100 million. It does nothing to dispel the USA’s reputation for having a litigation culture and it highlights the importance of protecting a business against litigation as a vital component of risk management.
Treating people right
To suggest that treating people fairly and honestly reduces litigation risk might sound like an over-simplification, but here’s the thing. A significant proportion of lawsuits are borne more of anger and frustration than sound legal analysis. Furthermore, if a business is in the habit of treating its employees, or indeed its clients, with anything less than transparency and fairness, it is inevitably increasing the risk of a dispute.
Mistakes and accidents are part of life and happen every day. If a business uses sound employment practices and maintains good relationships with customers, these mishaps are less likely to escalate into legal action.
Retain a good lawyer
Having said that, there are some incidents that will inevitably lead to lawsuits, however good your relationships. If an employee is seriously injured or worse in the course of his or her work, then litigation is almost a certainty. Taking that worst case scenario as an example, there are different types of wrongful death claims and it is vital to act quickly and decisively to minimize the impact, both financial and reputational.
To this end, sound legal advice from a trusted lawyer who knows your business and industry is essential. In most cases, it makes more sense to mitigate than to litigate, and an early settlement might be the most painless solution all round. But that’s not a decision you can take without the right legal support.
Keep exemplary records
Regardless of the type of business you operate, it will inevitable generate plenty of documentation – this is, after all, the big data age. At the first suggestion of litigation, it is vital to ringfence all the data you have relating to the incident. For one thing, you need it to understand what has happened and what liability you might hold, and for another, you will be legally obliged to disclose it if the matter gets to the document discovery stage.
Years ago, that meant preserving job files, reports, note books and so on, but today, the challenge can be greater, as there is more correspondence via more platforms and channels than ever. It means businesses need to have sound procedures in place for how communications take place and how records of those exchanges are stored.
Don’t become another statistic
Litigation is a risk that needs to be taken seriously, but it is also one that can be overblown. Treating people well is arguably the most important thing you can do to prevent litigation in the first place. Retaining good legal support and having sound record keeping procedures will help you minimize the impact if, despite your best efforts, a lawsuit comes your way.
