Employee Signage and Risk Mitigation
An often overlooked benefit of Employee Signage is its ability to help mitigate legal risk.
Recently, I attended a Technology of Georgia (TAG) event and had the opportunity to discuss this topic with the lead counsel for a fairly-large Atlanta corporation.
Allow me to share some pertinent points related to our discussion.
The Pervasiveness of Litigation by Employees
In today’s business environment, lawsuits brought against corporations by employees is pervasive and growing each year. The top categories of these lawsuits include Discrimination (race, disability, sex, age), Sexual Harassment, and Hostile Workplace/Retaliation.
Every business is at risk of employee lawsuits. Larger companies are more likely to be sued and are more susceptible to larger damage awards.
Some recent statistics include (Source: Gitnux Marketdata Report: Must-Know Employee Lawsuit Statistics (December, 2023)):
In 2019, in the United States, there was a total of 72,675 Equal Employment Opportunity Commission (EEOC) complaints lawsuits filed.
In 2020, the total monetary value of all EEOC claims reached over $106,000,000.
The average cost for an organization to defend against a single employee lawsuit is $160,000.
The median award for an employee plaintiff in a wrongful termination lawsuit is $70,000.
Approximately 41% of all EEOC claims are for Retaliation.
The number of claims and associated costs reliably increase each year.
How Employee Signage Helps Mitigate Risk
When coupled with the right content strategies, Employee Signage offers organizations a tool to help mitigate the risks associated with employee lawsuits.
Here are four ways that Employee Signage helps mitigate this risk:
Creating Awareness and promoting a culture free of discrimination and harassment helps avoid/reduce instances of wrongdoing.
Encouraging Employees to safely report - free of retaliation - helps victims AND reduces jury awards. Think about the value of saying “Our employee signage has had over 100,000 impressions of “awareness and support” spots over the past year” when in the award phase of litigation.
Avoiding these unsavory events helps keep moral and productivity high.
Showing concern for Employee Welfare greatly improves Employee Engagement. This helps in terms of Operational Efficiency, Employee Retention, and a host of other benefits.
The Many Forms of Return On Investment From Employee Signage
There are many ways that incorporating a risk mitigation strategy produces positive Return On Investment (ROI) for the organization.
Some examples based on the benefits detailed above include:
On average, a single instance of avoiding an employee lawsuit saves the organization $230,000 ($70,000 in awards, $160,000 in expense).
The reduction in damage awards realized when an organization successfully demonstrates promotion of a non-discriminary culture and the ability for employees to report violations free of retaliation is often found to be in the range of 50% (median savings of $35,000 per lawsuit).
Employee Retention dramatically improves when employees approve of the organization’s culture and values. The overall expense associated with replacing an employee varies between $2,200 and $15,000 depending on the industry. Note the larger number is associated with the certain technology companies.
Employee Engagement produces a wide range of economic benefits. Past clients have suggested improvements in Operational Efficiency of 20% associated with strong engagement. This economic benefit of this improvement is significant for organizations.
These benefits far outweigh the nominal expense of implementing and maintaining an Employee Signage network.
The ROI of any Employee Signage network is driven by its content strategy. At Butterpie, we help organizations optimize their Employee Signage content strategies. Please contact us if you would like to start a conversation.