It’s not just how you do business, but where you do business. 2015 Hiscox Employee Lawsuit Handbook

October 27, 2015

Employee litigation is a fact of life for American businesses.  Employers always need to be ready to defend themselves against allegations that some employees have been treated unfairly.  These matters can be difficult and expensive to defend against, even if they don’t end up in court.

Companies that try to manage employee litigation risk often have a difficult time quantifying their actual exposure for lack of reliable data.  Too often, the only statistics they can use to gauge their risk are federal employment charge activity numbers from the EEOC.  The EEOC capture national trends only, but don’t account for the many employment charges that are filed at the state level.

The 2015 Hiscox Employee Lawsuit Handbook examined the landscape across the US at both the state and local level and found some major variations across the country.

Why does this matter?
Employee legal actions are disruptive regardless of their origin, merit or magnitude.  The average employee legal action against a small- to mid-sized firm (less than 500 employees) takes 275 days to resolve and carries a cost of $125,000 .  Beyond the hard costs, these actions are a major source of distraction to the business.  Proper risk management techniques can help reduce the probability of a suit overall, if you’re up to date on the latest federal and state employment laws.

Am I operating in a dangerous state?

Across the US, the average chance of having an employee charge filed against an employer was at least 11.7% in 2014.  There were a number of states that far exceeded that average, and some that came in well below.  See if you’re living dangerously and download the full 2015 Hiscox Employee Lawsuit Handbook to get more insight and tips on how to minimize your risks.

Hiscox Insurance States with highest employee lawsuit risk