Employee lawsuits are Breaking Bad for US businesses

29th October 2015

Categories:

  • Executive insight
  • Walter White was constantly dealing with threats to his business as he built his meth empire in the popular series Breaking Bad. The industrious Mr. White had to worry about the Mexican mob, outlaw bikers and even his own brother in law trying to eliminate him and his business. But one thing that other New Mexico businesses have to worry about, employee lawsuits, wasn’t as much of a problem for Walter White, since his business was illegal and all. Unfortunately, the probability of legal actions by employees in New Mexico isn’t fictional - at 66% higher than the national average, it’s a bigger threat to most businesses in the state than Gus Fring or a fly in the lab.

    Which side are you playing?

    The 2015 Hiscox Employee Lawsuit Handbook found that small to mid-sized businesses across the US faced at least an 11.7% chance of an employee legal action in the US in 2014.  But the likelihood of an employee filing legal action against their employer was much higher than the national average in New Mexico, California and several other states.  These legal actions have real costs, and the average business can’t just cook up another batch of product like Mr. White to get back on their feet.  The average employee legal case against a mid-sized employer (under 500 employees) takes nearly a year (275 days) to resolve and costs the company $125,0001.

    I am the danger

    Just like Walter White thought he was in control right up until he had to go into hiding and leave his family, many businesses are blissfully ignorant of the specific risks they face in different states across the US.  The federal statutes laid out by the Equal Employment Opportunity Commission (EEOC) are a good starting point, but many states have laws that go farther than these – specifying protections for additional classes of employees or applying these regulations to companies smaller than specified in the federal statutes.

    The empire business

    Even the biggest businesses were once small operations. The road to success is full of challenges that need to be overcome to grow and succeed, whether they’re the violent criminals in Breaking Bad or the legal threats businesses are seeing in real life.  Luckily, there are some specific steps small and medium-sized businesses can take to stay on the right side of the law and reduce their chances of having an employee legal action.

    1Hiscox analysis of 446 representative claims against organizations with less than 500 employees.

    Hiscox EPL Infographic_102315

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