A California business cannot survive if it runs into severe financial troubles. One way to reduce potential financial risks involves establishing a loss-prevention strategy. Such steps may entail reducing or eliminating liabilities resulting in a lawsuit. Understanding the common reasons why business owners may face civil actions could help prevent lawsuits.
Businesses experience legal woes
All businesses could face the perils of a personal injury lawsuit when managers, employees and others are negligent. Not cleaning up debris from the front of the office or not warning customers about wet floors could leave proprietors facing a slip-and-fall claim. Ignoring loiterers may leave business owners partially liable for assaults that occur. And there are numerous other examples of negligence that might result in harm and civil lawsuits.
Lawsuits may also center on claims a business owner breached a contract. Under applicable law, any party that does not fulfill obligations stipulated in a contract might breach the agreement, opening doors for the other party to sue. Some might breach a contract by accident. Failing to correct the situation may lead to litigation.
Other scenarios that might result in lawsuits
Discrimination and harassment could lead to lawsuits that result in severe punitive awards. Such incidents may occur even when the business has a strong policy against discrimination and sexual harassment. Employers could become responsible for an employee and subordinate’s behavior if they ignore certain activities or fail to take action. Retaining a middle manager with a troubling record might prove regrettable.
Wage violations happen even though federal and state statutes ban certain actions. Forcing employees to work overtime and not compensating them reflects a common wage law violation that could get a business in trouble.