One of the most feared phrases in the HR lexicon is “class action” or how to turn a one-employee small suit into a many-employee gigantic suit. Today we will look at survey data on class actions and at the best tool for preventing them.
In yesterday’s Advisor we looked at lawsuit cost data from law firm Fulbright & Jaworski L.L.P.’s Fifth Annual Litigation Trends Survey. Here are the survey’s findings regarding multi-plaintiff cases:
In which area of multi-plaintiff cases have you seen the greatest increase?
Respondents were asked about changes in the volume of multi-plaintiff cases (class/collective actions) in the past 12 months in various areas of labor and employment law. Supporting what a number of sources have suggested, the survey showed a definite spike in multi-plaintiff suits, mostly stemming from wage-and-hour claims by employees.
Percentages of respondents naming different types of suits as having the greatest increase:
| Wage and Hour | 32% |
Discrimination | 23% |
Privacy | 15% |
ERISA | 7% |
Disabilities | 7% |
ADEA/Age | 6% |
Other | 9% |
Percentages total less than 100% due to rounding.
For smaller companies, discrimination dominates, followed by wage-and-hour cases. Discrimination cases are also at the top of the list for medium-sized companies, but privacy-issue cases outweigh wage-and-hour cases.
Increases in wage-and-hour multi-plaintiff cases are most common in California, the South, and the Midwest (20% – 30% of respondents) and were reported most in the education (43%) and retail/wholesale (33%) sectors.
Increases in discrimination cases are most prevalent in education (43%), financial services (22%), and retail/wholesale (20%).
ERISA cases are rising the most in the Midwest (15%) and in the retail/wholesale (17%) and engineering/construction sectors (16%).
Age discrimination cases are rising in the education (29%), financial services (14%), real estate (13%), and technology/ communications (13%) sectors.
Increases in multi-plaintiff privacy-issue cases are most common in California (28%) and in technology/communications (19%), retail/wholesale (14%), and education (14%).
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Where are most of the cases being brought?
Finally, news that may comfort many readers came when respondents were asked to name the three states/regions in the U.S. where they have the greatest number of significant cases pending in terms of material risk. Texas and California, watch out.
Texas | 47% |
West | 37% |
California | 36% |
Atlantic | 27% |
East Coast/New England | 24% |
South | 12% |
Midwest | 14% |
Total exceeds 100% due to multiple choices
Lawsuits on the rise, budgets on the decline, what do to? The “simple solution”? Stop the lawsuits. Of course, that’s not so simple, but the basic tool for stopping wage-and-hour class actions and other lawsuits is simple—the HR audit. It’s the only sure-fire way to identify problems early and correct them before they turn into expensive lawsuits.
Experts recommend an annual audit, but maybe next week would be better? In either case, to do a good audit, you need audit checklists, and there’s good news: BLR’s editors have already written them—for all of the most challenging areas of HR.
Don’t “just do it” … do it right. HR Audit Checklists ensures that you know how. Try the program at no cost or risk. Find out more.
Why Checklists?
Why are checklists so great? Because they’re completely impersonal, and they force you to jump through all the necessary hoops, one by one. They also ensure consistency in how operations are conducted. And that’s vital in HR, where it’s all too easy to land in court if you discriminate in how you treat one employee over another.
The program our editors recommend is BLR’s HR Audit Checklists.
Just as an example of how it compels thoroughness, it contains not one but three checklists relating to recordkeeping and digital information management. One lists 34 types of data and also covers confidentiality, emergency planning, efficiency, compliance with laws, and safety. You’d likely never think of all those possible trouble areas without a checklist, but with it, just scan down the list and you instantly see where you might get tripped up.
In fact, housed in the HR Audit Checklists binder are dozens of extensive lists organized into reproducible packets, for easy distribution to line managers and supervisors. There’s a separate packet for each of the following areas:
- HR Administration (including communications, handbook content, and recordkeeping)
- Health and Safety (including OSHA responsibilities)
- Benefits and Leave (including health cost containment, COBRA, FMLA, workers’ compensation, and several areas of leave)
- Compensation (payroll and the Fair Labor Standards Act)
- Staffing and Training (incorporating Equal Employment Opportunity in recruiting and hiring, including immigration issues)
- Performance and Termination (appraisals, discipline, and termination)
HR Audit Checklists is available for a no-cost, no-risk evaluation in your office for up to 30 days. Visit here and we’ll be happy to arrange it.