This is the final column in a three-part series aimed at helping manufacturing companies avoid litigation. In part one, we recommended that companies regularly review their existing insurance policies and programs, with an eye toward previous issues as well as toward future growth and development. In part two, we addressed how manufacturers can accurately assess exposure to risk related to product liability claims.
Just as smart insurance and products liability practices are essential in effective risk management by manufacturers, so are good, proactive employee relations practices. Often overlooked, such practices can play the deciding role in helping to prevent or, at a minimum, helping a company successfully and efficiently defend against, a legal claim from a rogue employee otherwise might be source of tremendous financial, operational and public relations stressors on a company.
Of course, a good handbook is hardly worth the paper it is written on unless it is consistently and effectively enforced. Policy enforcement should begin with the company’s leadership, and specifically the leadership’s awareness of and commitment to upholding and enforcing personnel policies in a consistent and effective manner. That requires risk managers to communicate key handbook policies whenever new employees join the company, and also during periodic training intervals thereafter. Though often dreaded, policy training really does not have to be, and should not be, “boring” or “tedious.” If done well, it should be informative and insightful in helping management and subordinate employees to recognize and resolve workplace issues before they turn into legal problems.
Risk management through effective restrictive covenant agreements