The Biggest Legal Threat to Your Business

If you’re a business owner, odds are you do everything you can to grow your business, minimize risk, and prevent failure.  You diversify your products and services, purchase expensive insurance policies, and try to stay ahead of the curve on market changes and legal challenges.

What if we told you that the biggest threat to your business is largely ignored by most businesses yet it has the potential to shut your doors?  Wage and hour lawsuits are the next wave of “legal extortion”—using California’s numerous and complex labor and employment laws to impose huge penalties on businesses usually based on ticky-tack violations of the law.

The Biggest Legal Threat to Your Business

If you’re a business owner, odds are you do everything you can to grow your business, minimize risk, and prevent failure.  You diversify your products and services, purchase expensive insurance policies, and try to stay ahead of the curve on market changes and legal challenges.

What if we told you that the biggest threat to your business is largely ignored by most businesses yet it has the potential to shut your doors?  Wage and hour lawsuits are the next wave of “legal extortion”—using California’s numerous and complex labor and employment laws to impose huge penalties on businesses usually based on ticky-tack violations of the law.

Employment Lawsuits Are on the Rise

The number of employment class action lawsuits is skyrocketing and increasing every year.

In 2014, there were over 450 employment class actions filed against California businesses.

In 2015, this number more than doubled, with over 1,100 employment class actions filed in California.

In 2016, there were over 1,200 employment class actions and Private Attorneys General Act (PAGA) lawsuits filed against businesses in California.

In 2017, this number grew again to 1,700 employment class actions and Private Attorneys General Act (PAGA) lawsuits filed against businesses in California.

In 2014, there were over 450 employment class actions filed against California businesses.

In 2015, this number more than doubled, with over 1,100 employment class actions filed in California.

In 2016, there were over 1,200 employment class actions and Private Attorneys General Act (PAGA) lawsuits filed against businesses in California.

In 2017, this number grew again to 1,500 employment class actions and Private Attorneys General Act (PAGA) lawsuits filed against businesses in California.

More Money, More Problems

Lawyers representing employees follow the money.  And with California employment law favoring employees, the number of lawyers filing these lawsuits is growing and their tactics are getting more and more sophisticated.  These lawsuits typically cost tens of thousands to defend with defense attorney fees ranging from anywhere from $50,000 to over $1 million depending on the size of the case and the business.  The cost of settlement is often even higher and can range from several hundred to several thousand dollars per employee.

PAGA actions—another form of legalized extortion

PAGA actions—another form of legalized extortion

More Money, More Problems

Lawyers representing employees follow the money.  And with California employment law favoring employees, the number of lawyers filing these lawsuits is growing and their tactics are getting more and more sophisticated.  These lawsuits typically cost tens of thousands to defend with defense attorney fees ranging from anywhere from $50,000 to over $1 million depending on the size of the case and the business.  The cost of settlement is often even higher and can range from several hundred to several thousand dollars per employee.

Doing Nothing—The Odds Are Not in Your Favor

What’s the response from most business owners?  Virtually nothing.  Wage and hour lawsuits are not covered by typical insurance policies.  Specialty insurers are recognizing this trend and are experimenting with the California market, but currently the minimum monthly premium for complete wage and hour class action coverage is over $15,000.  That price alone demonstrates how big the threat is to businesses.

Traditional Protections Are Ineffective

HR departments (if your company even has one) are often overwhelmed by the crush of day-to-day tasks and usually have little time, let alone the knowledge, to properly train managers and employees on how to protect the company against sophisticated lawyers coming after the company for hundreds of thousands or even millions of dollars.

Many businesses pay significant money to outsourced HR companies or third-party payroll companies, thinking they’re protected.  The explosion in wage and hour class actions shows otherwise.  These companies try their best to summarize the law for their clients or update handbooks, but they fall short in creating and implementing best practices that will not only educate managers and employees, but that will also actually help to prevent these kinds of lawsuits in the first place.

The Solution—Lawsuit Deterrence and Protection

The Solution—Lawsuit Deterrence and Protection

California Compliance Solutions—founded by experienced wage and hour defense attorneys—was created to fill the gap in the marketplace and to provide businesses with a real solution to help prevent and protect against employment lawsuits.

“All California employers, but particularly those with limited HR resources, MUST get this ToolKit and diligently roll it out and enforce its policies to give their business the best chance of avoiding or successfully defending expensive lawsuits.”

– California Class Action Mediator

Built to Protect

The CCS Wage and Hour ToolKit allows businesses to quickly and efficiently educate and train managers and employees on wage and hour rules and best practices to help prevent lawsuits.  But it doesn’t stop there.  Much like a burglar alarm deters theft, the Wage and Hour ToolKit helps to deter wage and hour lawsuits before they even happen by allowing every employee to receive not only training, but also testing, on wage and hour laws and your company’s policies.  Your employees and your managers will take a test and sign a certification that your business will keep as a protection against lawsuits.

The lawyers filing these kinds of suits often work on contingency.  So the more time spent fighting in court is less money in their pockets.  That’s why lawyers typically sue only the most vulnerable businesses: those without adequate protection and training.  For a plaintiffs’ lawyer looking to make a quick buck, a business that has ready proof of certified training on wage and hour rules does not make for an easy or attractive target.

The Numbers Don’t Lie

The statistics show that if you are doing business in California, your business is exponentially more likely to get hit with a wage and hour lawsuit than to have your building burn in a fire or to have one of your executives embezzle millions. Yet virtually every business buys expensive insurance policies to cover these contingencies. For a fraction of the cost of most insurance policies, CCS can become a powerful ally in your suite of risk management products.

Built to Protect

The CCS Wage and Hour ToolKit allows businesses to quickly and efficiently educate and train managers and employees on wage and hour rules and best practices to help prevent lawsuits.  But it doesn’t stop there.  Much like a burglar alarm deters theft, the Wage and Hour ToolKit helps to deter wage and hour lawsuits before they even happen by allowing every employee to receive not only training, but also testing, on wage and hour laws and your company’s policies.  Your employees and your managers will take a test and sign a certification that your business will keep as a protection against lawsuits.

The lawyers filing these kinds of suits often work on contingency.  So the more time spent fighting in court is less money in their pockets.  That’s why lawyers typically sue only the most vulnerable businesses: those without adequate protection and training.  For a plaintiffs’ lawyer looking to make a quick buck, a business that has ready proof of certified training on wage and hour rules does not make for an easy or attractive target.

The Numbers Don’t Lie

The statistics show that if you are doing business in California, your business is exponentially more likely to get hit with a wage and hour lawsuit than to have your building burn in a fire or to have one of your executives embezzle millions. Yet virtually every business buys expensive insurance policies to cover these contingencies. For a fraction of the cost of most insurance policies, CCS can become a powerful ally in your suite of risk management products.