The Business Case for WorkSmart Partners

WorkSmart Partners often costs less than responding to a charge, an early settlement payment, or insurance deductible

Investing in your executive team’s ability to lead strategically in the new business and legal environment is essential to your organization’s success. We prepare your leaders and managers to strategically align legal compliance with business and talent goals.

The nuisance cost to settle an employment claim early in the litigation process is typically in the $5,000-$50,000 range. A far better investment of your resources would be state-of-the-art executive leadership and management training by a seasoned expert.

Expert training and policy management provide an affirmative defense to many lawsuits and can result in early dismissal

In many harassment cases, the employer can obtain early dismissal of the case by showing it maintained an appropriate policy, trained its leaders, managers and employees in following it, and did in fact comply with the policy. When your team understands how to identify potential mental and physical impairments under the ADA, and appropriately engage in the interactive process, you are far more likely to avoid litigation altogether or obtain early dismissal. In fact, in Colorado and other jurisdictions, showing good faith efforts to identify and make a reasonable accommodation will preclude punitive damages.

Reducing turnover by just one employee pays for WorkSmart

The cost of employee turnover is between one and two times the annual salary of the typical employee. A strong compliance program that identifies and remedies harassment early, or an effective workplace flexibility program that increases employee retention, therefore more than pays for itself. In fact, our first client was informed by an employee that she would stop looking for a new job because they would soon be implementing a telework and compressed workweek program.

EEOC consent decrees illustrate the enormous costs of claims prior to trial

In fiscal year 2014, the EEOC obtained $296.1 million in total monetary relief through its enforcement program prior to the filing of litigation.1 The cost of settling claims in which the EEOC has either filed or joined, is often extremely high. All of the following consent decrees required employer training:

State of Maryland paid $620,000 in damages including back pay, front pay, and attorney fees, resulting from sexual harassment and retaliation.2

Hospital paid $125,000 for refusal to provide written instructions for greeter with cognitive disability.3

Car dealership paid $250,000 paid to former general manager fired for developing Multiple Sclerosis, in violation of ADA.4

Bank of America paid $101,000 for terminating a temporary employee on his second day of employment for failing to accommodate his visual impairment.5

Nonprofit social services agency paid $309,000 to employee with Multiple Sclerosis it failed to accommodate under ADA.6

Pipe fitting manufacturer paid $65,000 for refusal to provide 6 weeks of unpaid leave to Marine veteran with PTSD, in violation of ADA.7

Insurance underwriters require strong compliance programs, including current policies and management and employee training, as a condition of coverage8

In response to the increase in employment lawsuits and their costs, more employers seek Employment Practices Liability Insurance (EPLI) coverage. Deductibles fall between $5,000 and $25,000, depending on many factors, including:

  • staff turnover rates
  • loss history including nature of the claims asserted and costs associated with those claims
  • whether layoffs are imminent
  • employment practices
  • quality and currency of employee manual
  • whether a staff member is dedicated to addressing employment-related issues
  • whether annual training in antidiscrimination and antiharassment is provided
  • whether appropriate investigations are conducted in response to grievances

If you seek EPLI insurance, you will be required to:

  • Update and overhaul antidiscrimination and antiharassment guidelines
  • Provide antidiscrimination and antiharassment training
  • Assure appropriate investigation practices are in place

According to the American Bar Association,

  • 10 percent of wrongful termination and discrimination cases result in awards of $1 million or more
  • 67% of employment cases result in judgment for the plaintiff when taken to litigation
  • 6 out of 10 American employers have faced an employment lawsuit in the last 10 years.

 

For a free one-hour consultation with Mary, call (303) 229-3597 or email her at mary@worksmartpartners.com

 


  1. See EEOC Press Release at http://www.eeoc.gov/eeoc/newsroom/release/2-4-15.cfm
  2. See EEOC Press Release at http://www.eeoc.gov/eeoc/newsroom/release/2-12-15.cfm
  3. See EEOC Press Release at: http://www.eeoc.gov/eeoc/newsroom/release/2-12-15b.cfm
  4. See EEOC Press Release at http://www.eeoc.gov/eeoc/newsroom/2-11-15a.cfm
  5. See EEOC Press Release at http://www.eeoc.gov/eeoc/newsroom/release/12-19-14.cfm
  6. See EEOC Press Release at http://www.eeoc.gov/eeoc/newsroom/release/12-31-14a.cfm
  7. See EEOC Press Release at http://www1.eeoc.gov/eeoc/newsroom/release/1-9-15b.cfm
  8. The Ins and Outs of Employment Practices Liability Insurance Coverage and Claims, Janet R. Davis, Gary R. Gassman, The Brief, Volume 42, Winter 2013, c. 2013 the American Bar Association. Available at: http://www.mbtlaw.com/pubs/insoutwinter2013.pdf
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