I’ve heard it from clients for many years: “Why should I settle and pay that !#@&%## a dime? We didn’t do anything wrong.”
It’s a simple fact: Once your business has been sued for discrimination, harassment, retaliation, or wrongful termination, it’s too late. Your organization is going to pay legal fees and related defense costs (expert witness fees, deposition transcripts, exhibit preparation, travel expenses, etc.) There may well be adverse publicity and a resulting drop in the stock price. And litigation is a terrible distraction from running your organization. Everyone involved has to spend a lot of time thinking and talking about the past, instead of focusing on today’s and tomorrow’s challenges.
Take a look at this recent settlement of a case that dragged on for 30 years, featured in Fair Measures’ current e-News.
There are several reasons why employers settle employment lawsuits, including:
- Cost: Settlements can be far less expensive than going to trial, which can involve high legal fees, court costs, monetary damages, and even punitive damages. Did you know that your business insurance cannot pay for punitive damages?
- Time: Settlement negotiations are usually faster than litigation, which can take years to resolve.
- Stress: Settlement negotiations or mediations are far less stressful than presenting evidence in front of a judge and jury.
- Resolution: Settlements provide a definite resolution to the dispute, rather than the uncertainty of a trial outcome. Trust me, you never know what a jury is going to do. And remember, the loser at trial can always take an appeal. If the appeal is successful, guess what? You are going to have to try the case all over again, in front of a new jury.
So, if your attorney recommends that you settle or mediate a case, listen carefully. I know that it may hurt to pay money on a claim that you think is weak, but that money is probably a good investment when you consider the time, distraction, bad publicity, cost, and unpredictability of litigation.
