(This is the second in a series of columns about how companies deal with worst-case scenarios.)

In the previous article I discussed some of the worst-case scenarios that businesses face, such as fraud, theft and lawsuits. In this article, we will discuss how to handle these situations.

Here are some suggestions:

Fraud. All employers like to think that they hire honest employees, but fraud does happen. In the event that fraud occurs, companies need to build a paper trail to make sure they have a solid case. Companies may also need to literally quarantine an employee’s computer until the situation is resolved.

This means that no one can touch the employee’s computer. In the event of a court case, the defending attorney can argue that someone else might have accessed or tampered the computer.

Theft. Employers need to document every case of theft and, if possible, gather video evidence. They also need to determine if the offense warrants a termination or a reprimand. If an employee takes home an envelope, it could be classified as theft, but terminating an employee for this offense would make the company look bad.

If you decide to prosecute, you have to file a police report. If you terminate an employee you must reclaim their company equipment and escort them out of the building. Codes, credit cards and other financial information should also be changed.

Lawsuits. Lawsuits need to be handled by the company’s in-house attorney or the lawyer assigned by your insurance company.

Workplace disputes can also be handled in mediation, which is less costly than a legal case. However, the American justice system is very expensive and lawsuits can be won by simply waiting for the defendant to run out of money. Cases can take years to work their way through the system, and cost you hundreds of thousands of dollars, even if you win.

Another alternative that your legal counsel might suggest is settling, which avoids a costly court case and negative publicity. Settlements often mandate that the plaintiff cannot talk about the case. The problem is once you settle, you set a precedent, and more employees might think about trying to get a big payday.

Intellectual theft. Problems arising from intellectual theft are the reason why it is important for employees to sign non-disclosure agreements that forbid them from leaking company secrets. Another way to protect against intellectual theft is to make sure that all proprietary information and technology is protected by copyrights and patents.

If you suspect that a company is violating copyright laws, you need to contact a lawyer, who will write a cease and desist letter. If that doesn’t resolve the issue, you are looking at a civil case.

I hope this advice helps business owners if they ever go though these situations. Let’s hope you never have to put this advice to use!

Sarah Cullins is vice president of business
development at Corporate Resource Services in Rancho
Cucamonga. Reach her at 909-466-9933 or scullins@crsco.com

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