Small Business & Lawsuits infographic
Brought to you by EVNLaw.com Designed for the Small Business Owner
HOW HIGH IS YOUR RISK? Small Business and Lawsuits
Small businesses that don’t take the threat of legal action seriously are setting themselves up for trouble. Don’t leave yourself and your business exposed.
1 in 3
small business owners are either
sued or threatened by a lawsuit.
Lawsuits against small businesses account for
$36,500,000,000
out-of-pocket dollars
for the small business owner annually.
NEGATIVE EFFECTS OF A LAWSUIT ON SMALL BUSINESS The cost of an employment lawsuit is not exclusively defined by the amount written on a check. It is also measured by the effect it has on the company, its employees and customers.
74%
73%
73%
71%
68% 53%
LAWSUIT PREVENTION
LIMITING PRODUCTS
REDUCING BENEFITS
HALT IN HIRING
REPUTATION DAMAGED
IMPAIRED CREDIT
INCREASE IN COSTS
59%
INCREASE IN EMPLOYER HARASSMENT CLAIMS Employee lawsuits have risen
400%
in the past 20 years.
The current annual level is 6.5 claims per 1,000 employees
cost to settle
The average an employment lawsuit has
The current average cost is more than
tripled
$300,000
over the past five years.
The rise of empolyee harrassment claims from 2005 to 2011.
24.5%
19.1%
32.1%
42.6%
62.3%
29.3%
37.3%
Race
Sex
Origin
Religion
Color
Age
Disability
TORT LIABILITY Think lawsuits only affect the big guys? Think again.
Company size
$50M
Dollars spent
$86 billion
$27.3 billion
$7.9 billion
$14.2 billion
$15 billion
57 %
18 %
5%
9%
10 %
Percentage of total dollars spent
Annual cost for U.S. small business tort liability:
$105.4 Billion
Share of small business
81
%
tort liability cost Share of small business
revenue
22
%
HOW TO PROTECT YOURSELF
These five simple steps can help you and your business succeed
1
MAKE IT LEGAL It’s the single most important way to protect yourself and your business from lawsuits. There are other benefits too, like saving money on taxes, access to resources and building a foundation for your brand.
GET IT IN WRITING From partners to employees, from investors to vendors, you need a written contract with everyone you do business with. It gives a basis for talking about expectations in the company and gives you protection.
3
BE PROACTIVE Build a relationship with an attorney you trust as part of your leadership team. Just like looking to a doctor to get medical advice, your attorney can provide a wealth of business advice.
RESOLVE COMPLAINTS A good attorney has been in the business world solving problems—problems just like yours. Having an attorney on your team can be the difference between having a good resolution versus damaging relationships or the business.
5
2
4
GET COVERED Like insurance for your home, it seems unnecessary–until you need it. Then it’s the difference between a difficult position and a horrible situation. Be cautious and get insurance coverage for your business.
For more information about how to create, build or protect your business, please contact us at EVNLaw.com.
boltinsurance.com | facesoflawsuitabuse.org | U.S. Chamber of Commerce Institute for Legal Reform bloomberg.com | U.S. Equal Employment | Opportunity Commission | mieeranddzois.com | mansfieldtanick.com
HOW HIGH IS YOUR RISK? Small Business and Lawsuits
Small businesses that don’t take the threat of legal action seriously are setting themselves up for trouble. Don’t leave yourself and your business exposed.
1 in 3
small business owners are either
sued or threatened by a lawsuit.
Lawsuits against small businesses account for
$36,500,000,000
out-of-pocket dollars
for the small business owner annually.
NEGATIVE EFFECTS OF A LAWSUIT ON SMALL BUSINESS The cost of an employment lawsuit is not exclusively defined by the amount written on a check. It is also measured by the effect it has on the company, its employees and customers.
74%
73%
73%
71%
68% 53%
LAWSUIT PREVENTION
LIMITING PRODUCTS
REDUCING BENEFITS
HALT IN HIRING
REPUTATION DAMAGED
IMPAIRED CREDIT
INCREASE IN COSTS
59%
INCREASE IN EMPLOYER HARASSMENT CLAIMS Employee lawsuits have risen
400%
in the past 20 years.
The current annual level is 6.5 claims per 1,000 employees
cost to settle
The average an employment lawsuit has
The current average cost is more than
tripled
$300,000
over the past five years.
The rise of empolyee harrassment claims from 2005 to 2011.
24.5%
19.1%
32.1%
42.6%
62.3%
29.3%
37.3%
Race
Sex
Origin
Religion
Color
Age
Disability
TORT LIABILITY Think lawsuits only affect the big guys? Think again.
Company size
$50M
Dollars spent
$86 billion
$27.3 billion
$7.9 billion
$14.2 billion
$15 billion
57 %
18 %
5%
9%
10 %
Percentage of total dollars spent
Annual cost for U.S. small business tort liability:
$105.4 Billion
Share of small business
81
%
tort liability cost Share of small business
revenue
22
%
HOW TO PROTECT YOURSELF
These five simple steps can help you and your business succeed
1
MAKE IT LEGAL It’s the single most important way to protect yourself and your business from lawsuits. There are other benefits too, like saving money on taxes, access to resources and building a foundation for your brand.
GET IT IN WRITING From partners to employees, from investors to vendors, you need a written contract with everyone you do business with. It gives a basis for talking about expectations in the company and gives you protection.
3
BE PROACTIVE Build a relationship with an attorney you trust as part of your leadership team. Just like looking to a doctor to get medical advice, your attorney can provide a wealth of business advice.
RESOLVE COMPLAINTS A good attorney has been in the business world solving problems—problems just like yours. Having an attorney on your team can be the difference between having a good resolution versus damaging relationships or the business.
5
2
4
GET COVERED Like insurance for your home, it seems unnecessary–until you need it. Then it’s the difference between a difficult position and a horrible situation. Be cautious and get insurance coverage for your business.
For more information about how to create, build or protect your business, please contact us at EVNLaw.com.
boltinsurance.com | facesoflawsuitabuse.org | U.S. Chamber of Commerce Institute for Legal Reform bloomberg.com | U.S. Equal Employment | Opportunity Commission | mieeranddzois.com | mansfieldtanick.com
