Law column: Top four mistakes employers will make this year

Employment lawsuits continue to rise. Certain practices unfortunately repeatedly have resulted in a higher risk of employment litigation for businesses. Here are four tips to help businesses prevent employment related litigation in 2016:

1. Ignoring problem employees

Former GE CEO Jack Welch had it right: You hire the right people, give them the opportunity to spread their wings, pay them well and you almost don't have to manage them.

However, sometimes employees don't work out. Accordingly, if you have a disruptive or poor-performing employee, Welch further stated that good managers take these employees head-on, first listening to what is really going on with them, giving them tough but accurate evaluations, and demanding they change or improve poor performance. If they cannot change or improve, terminate their employment.

2. Not being prepared for the new overtime laws and inspections

The U.S. Department of Labor has announced the biggest change to federal overtime law since the law was passed in the 1930s. The proposed regulations would nearly double the salary threshold for exempt employees.

In addition, the Iowa Court of Appeals recently issued a case indicating that it closely will examine whether a person is truly an employee or an independent contractor, focusing on the extent of control by the employer over the detail of the alleged employee's work.

The DOL also will target employers who misclassify employees as 'exempt,' which denies employees overtime pay. The DOL also will target employers that label employees 'consultants,' 'independent contractors' or '1099s' to avoid paying payroll taxes. Ensure you can justify your employee classifications.

3. Failing to manage medical leaves of absence

Managing an employee's medical leave of absence creates many land mines for employers, including workers' compensation laws, the Family Medical Leave Act, and the Americans with Disabilities Act.

Think of FMLA at the beginning of a leave period, not at the end. Your handbook should inform the employees you plan to run FMLA leave concurrently with other leave to avoid double-dipping.

Remember that employers do not have to accept vague FMLA requests. The law permits your FMLA coordinator to seek clarification about the need for leave from the employee's doctor.

4. Failing to document performance properly

Any lawyer will tell you that a thorough, accurate personnel file containing a history of performance issues and other problems with an employee is invaluable in the event of a lawsuit.

Employees are less likely to sue when they are on notice of deficiencies. Juries expect to see performance issues documented before termination.

On the other hand, missing or sugarcoated performance evaluations will hurt you, as a jury will be suspicious either of the missing document or why such an employee was fired after the glowing review. In other words, document properly and accurately or not at all.

The bottom line? Watch out for these four trouble areas in 2016 in your workplace — and hopefully you — will stay out of court.

Wilford H. Stone is a lawyer with Lynch Dallas.