The Unforeseen Consequence of an Employee Lawsuit

When you're sued by an employee (or vice-versa), it may cause long-term damage in areas you don't expect

Written by Laura Williams

Say you botched a firing and are getting sued for wrongful dismissal.

Or a senior manager has been accused of harassment.

Or your workplace is under investigation for a health and safety infraction.

You don’t want any of these nasty employment-law scenarios to happen in your business; no one does. But they do happen. And they’re the kind of situations that become very expensive and shake the resolve of even the most seasoned CEO.

I regularly counsel employers through these types of incidents. Understandably, they stress over the financial consequences stemming from a protracted legal battle or out-of-court settlement—not to mention the negative press or reputation damage that could be inflicted on their firm.

What often slips their mind, however, is perhaps the most important consideration of all: how to rebuild a workplace culture battered by one of those unsettling disputes. And that’s to their detriment, as doing so is crucial to any organization’s bottom-line rebound after a culture-shaking event.

A strong workplace culture is critical to attracting, retaining and engaging top talent. Workplaces with strong cultures also tend to be safer, experience far less employee turnover and absenteeism and boast stronger bottom-line performance.

Read: Become an Engagement Superstar

Good workplace cultures are built on trust and communication. Those attributes tend to disappear quickly when an employee sues his employer, or vice-versa, or the company is involved in an external probe. Even if the issue is isolated to a single staff member, its effects can prove toxic if not handled well. So what can you do?

Damage control

When a nasty HR-related legal issue arises in your company, there are a few simple steps organizations can take to competently handle challenging events even as they unfold.

Having a solid communication strategy in place is an ideal starting point in the event that a workplace law challenge arises. That should cover everything from what you’re going to say, when you’re going to say it—and to whom. After all, nothing gets the rumour mill going quite like silence. Proactive communication involves making management accessible to address employees’ questions and concerns, while also training managers to maintain communication consistency and connect the organization’s approach to resolving challenges with its overall corporate objectives and expectations.

It’s also smart to adopt a rigorous post-mortem process. A serious assessment of what went wrong will allow you to help determine its effects on the organization and its people, then evaluate what additional steps are required to restore relationships and rebuild the culture.

Read: How to Slash Your Legal Costs

This post-mortem process often requires facilitated staff and management meetings, possibly under the watch of an HR lawyer or trained HR consultant. It could require management coaching (to rebuild morale and remind managers of their role as culture ambassadors), enhanced performance monitoring (to ensure peak productivity) and team-building exercises among affected employees (that could include both staff and managers as you move to improve relationships and reiterate core values).

You may also want to consider initiating shift changes to minimize contentious staff interactions. In extreme cases, outright terminations may be appropriate when an employee’s attitudes or performance can’t be realigned with the organization’s cultural objectives.

How to avoid bad scenarios in the first place

Of course, the best way to keep a disruptive legal incident from derailing your carefully-crafted culture is to avoid such events in the first place.

Read: How Not to Get Sued by Employees

By taking a proactive approach to employment law and designing engagement-fostering policies, organizations of all sizes can shield their bottom lines from the fallout after a major workplace upheaval.

It starts with smart policy design. That means employees have a clear understanding of their responsibilities, management has a clear role in communicating corporate objectives and rules are applied clearly and consistently. Next, it’s about reinforcing cultural expectations and hiring and training effective leaders who not only enforce those rules, but can inspire their employees with sound leadership and smart strategic decisions—particularly on the hiring front. Lastly, it takes a commitment to continuously nurture the kind of workplace culture where respect, integrity and communication help breed new ideas and innovations.

Still, even the most proactive organizations are likely to find themselves hit with an employment-law crisis at one point or another. Rebuilding a damaged culture is tricky, but it can be achieved with a customized approach paired with enough managerial support (and patience!) to allow the process to work. Your business may even re-emerge in better shape—and boasting a stronger bottom line—than before the infraction occurred.

Laura Williams is an employment lawyer and founder of Williams HR Law in Markham, Ont. She has more than 15 years experience providing proactive solutions to employers aimed at reducing workplace exposures to liability and costs that result from ineffective and non-compliant workplace practices.

More columns by Laura Williams

Originally appeared on PROFITguide.com