Question

Lawsuits against businesses can take many forms. Explain three examples of possible lawsuits against business and some of the difficulties in taking this form of action.

Answer 1

Discrimination Suits Not Based on Employment- The victims are not always workers when companies are sued for discrimination. Customers, distributors, customers, vendors, and other individuals with a connection to the company may file suits. For example, a client sues a restaurant on the grounds of their national origin for discrimination. Her suit claims the waiting staff made derogatory remarks about her homeland and then refused to serve her. Some EPL guidelines include claims of discrimination brought by non-employee persons.

Wage Law Violations- Most claims against employers are based on allegations that a federal, state, or local wage statute has been violated by the employer. These laws are collectively referred to as laws on wages and hours. The Federal Law on Labor Standards (FLSA) sets the minimum federal wage. It also controls child labor, record keeping, and compensation for overtime. The FLSA defines exempt and non-exempt two types for employees. Overtime pay is usually available for non-exempt employees, although non-exempt workers are not. Several states and municipalities have adopted their own wage and overtime pay laws. Wage and hour cases are often based on claims that either the minimum wage or overtime pay has not been paid by the employer. Workers may also contend that by misclassifying them as independent contractors, the company avoided paying overtime. Insurance is unlikely to cover claims based solely on complaints of violations of wage and hour law. These cases are not protected by general liability provisions and are specifically excluded under many labor practices and liability policies for managers and officers.

Torts- Many third-party lawsuits against companies are based on torts. A torture is a violation of the civil rights of a person. There are two types of torture that can lead to business lawsuits: accidental torture (negligence) and deliberate torture. Negligence by a business owner or employee may result in an accident that injures someone or damages the property of someone. The injured party may sue for bodily injury or property damage to the business or employee. Intentional torture such as false arrest and wrongful eviction can also result in litigation against businesses. A general liability policy can cover lawsuits against a company for bodily injury or property damage.