Employee related claims are growing on a national level, and that growth can be seen right here in the State of New Jersey. Some of this increase in employee lawsuits can be attributed to the recent economic downturn, and with a sagging economy, we can expect employee lawsuits to rise even further.

The frightening part for businesses is that employees win 71% of all employee related claims. Alleged violations of state and federal law can land you in court, and these violations apply to even the smallest of businesses. Any time these employment cases see the inside of a courtroom, the odds are instantly stacked against the employer.

To battle these odds, a company must protect themselves from potential employee lawsuits. Any size business is at risk, and any size business can protect itself from potential lawsuits. A company simply needs to adopt clear, written policies set forth in an employee manual. Any size business can reduce the risk of lawsuits by creating a legally compliant employee handbook.

This handbook will address all areas of policy and procedure and can limit an employees access to court and limit or even avoid punitive damages. Employee handbooks should address everything from clear precise vacation policies to strict compliance procedures for complaints by employees. Included in all employee handbooks should be bold disclaimers and a clear explanation of at-will employment. Recent Court decisions have even created rights for employers to limit an employees access to the court system and can restrict them to the arbitration process. It is always safer to rely on written procedure than to rely on common practices of the business or unwritten procedure.

Employee handbook provisions should be detailed, clear, precise, and fashioned for the individual business. Each state has different laws, and each handbook should be structured to include the laws of the state in which the business is located. Do not think for one second that an employee handbook is not important, it only takes one time to realize you made a mistake by not having a handbook, and by that time it could be too late.