Protecting Your Company From Legal Liability

A workplace or product mistake can slow or outright ruin what would otherwise be a productive day of business as usual. It’s unfortunate on multiple levels when you get the news that a project your company has worked on has caused someone harm, whether that be an employee or a consumer. It could be a problem with a machine you own, a product you distributed, or your computer systems, leaving you with some damage control to take care of. Essentially, your brand — your work and livelihood — is liable for these mistakes.

Some companies never come back from these things. There is generally a lot of damage done by faulty products or machines and countless examples of lawsuits resulting from these damages. Sure, mistakes happen, but some are too big to pretend they don’t matter.

If you want to protect your company, you need to be on the lookout early to ensure these mistakes happen as infrequently as possible, as many liability issues can be prevented. Additionally, you need to have damage control systems set in place so that when mistakes do occur you are able to handle them with the smallest hit to your operations. Steering clear of storms, as well as being prepared for them when they do arise, will allow you to stay afloat.

Preventative Methods

Number one in your set of priorities should be reducing liability before mistakes happen. You can prepare for negative happenstances all you want, but you shouldn’t have to count on them happening more than they need to. Therefore, you need to take some preventative methods toward reducing liability.

A good way to prevent liability is to keep your work spaces up to code. It’s important for you to know OSHA regulations and make sure things are in working order. Those health and wellness rules are actually there to prevent liability issues. Here are a few pointers on keeping your work environment legally safe:

  • Ensure that all hazards are known to employees.
  • Train all employees with a safety-first mindset.
  • Regularly inspect the workplace for potential malfunctions.
  • Adapt to safer work operations when possible.

When considering liability as it pertains to consumers, there needs to be a focus on a diligent caution. It’s important to be aware of how someone might be affected if your products are made incorrectly or used in a wrong way. Of course, the materials used should (to whatever extent possible) be safe as well. Squashing risk means preventing damage.

Taking Proper Protections

Think of protections as damage control. They are for the well-being of a workplace and the company. Some of them are in place due to the law, but companies are legally liable if they don’t include a warning label or materials information with the packaging and distribution of each product. If there isn’t a law requiring you to disclose this information, it may still be something to think about so you are not sued for negligence.

Along with company protections for product malfunction, worker protections need to be ensured as well. Workers’ compensation is the most commonly known example of this because employees need to be protected should something go wrong on the job. In addition to workers’ comp protections, you should have a health and safety expert help you set up safety rules and programs to prevent risks.

Now, say a crisis has already occurred and you are being held liable for an event that has already happened. In this case, you will need to be meticulous and cautious about what information makes it to the public. Be careful who you talk to, and never lie about anything

“The organization’s crisis communications should never comment on possible litigation in a manner that does not accurately reflect the organizations actual assessment of the crisis,” BizCatalyst contributor Michael D. Celock explained.

Routine or Pro-forma statements such as stating any allegations are without merit or that the organization cannot wait to defend its position in court could very well lead to subsequent problems if it becomes apparent that the organization’s position on the matter was different at the time the initial statements were made.

Liability in the Digital Age

There’s another kind of liability in our current age that didn’t exist in the same way for previous generations: data loss liability. Protections put in place for this are different than you would normally find in a factory job. It relies upon around the personal and private information of customers and workers.

Firewalls, third-party cloud storage, backups, and encryption are all tools commonly being used to protect sensitive data right now. Some companies have taken it a step further, opting to build their own cybersecurity control rooms as a means of disallowing office visitors from taking peeks or observing their operations too closely. But what happens if data is stolen via a hacking incident or systems crash and there’s a period of switching over to a new system?

In such cases, you need to take efforts to keep operations running despite the data loss. Using online document signage can be a good way of tracking employee attendance and continuing contractual agreements when your normal systems are inaccessible. It may be wise to have backup computers or a different network that you can revive your backups onto as well. And physical records never hurt. If you’re looking for more information on cybersecurity, look at what the experts have to say and take their advice.

Closing Thoughts

Curbing company liability is as crucial as ever to running a business, both for legal purposes and for your operations. Making sure the work environment you foster is running in tip-top shape and noticing safety concerns may prevent unnecessary damages. However, having workers’ comp set in place and offering warning labels for dangerous products can protect you from legal damage on both the employee and the consumer side. And in the digital age, a customer’s personal information is also at risk due to digital storage methods and needs to be safeguarded accordingly.


Jori Hamilton
Jori Hamilton
Jori Hamilton is a writer from the pacific northwest who enjoys covering topics related to social justice, the changing workplace, and technology.

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