We Asked a Legal Professional What Gets Companies Sued. Here’s What She Told Us

We talked with Heather, a legal professional at a law firm that represents employees in workplace disputes (name changed for privacy). Her job is to field every incoming call from people who think they have a case against their employer, and to separate the ones that actually do. We asked her what she sees most often as someone with a front-row seat to where things go wrong.

Heather talks to dozens of people every week. Most don’t have a legitimate case. But the ones that do tend to share a common thread: someone without an understanding of employment law was in the decision-making seat. These are the most common ways companies can unintentionally get themselves in trouble.

The Accidental HR Person

At companies between 15 and 50 employees, it’s really common for HR to fall to someone who is already there, often without formal HR training.

“A lot of times companies just have someone there who isn’t actual HR,” Heather told us. “They start doing payroll, then take over doing HR, and they just don’t know the laws for the state. That’s where things get tripped up.”

Employment law is state-specific and ever changing. What’s legal in one state isn’t in another. When a manager makes a snap decision to fire someone, that informal HR person may not know enough to ask the questions that matter: Has this employee recently taken protected leave? Filed a workers’ comp claim? Made a complaint?

Without that check, companies can find themselves on the wrong side of a statute they didn’t know existed.

Get the Timing Right on Termination

A common pattern in employment claims is a legitimate termination that happened at the wrong time.

Here’s how it typically plays out: an employee has been a problem for months. Performance issues, attitude problems, and tension with the team. Management is frustrated and at their limit. Then the employee calls in sick for a few days and comes back, and that’s when they get fired.

“Maybe they should be fired, but the problem is it’s never documented,” she explained. “Then they take a couple of sick days, and then they are terminated. What ends up happening is that they were a problem, but they were terminated at an inappropriate time.”

The employer had real reasons. But those reasons were never documented. And now the termination looks like it was triggered by the sick leave, which may be legally protected depending on the circumstances.

The same dynamic plays out with FMLA leave, workers’ compensation claims, and pregnancy. A company tries to move on from a difficult employee, but the timing creates a connection that’s hard to explain away, especially without documentation showing that the underlying performance issues predated the protected event.

When you are having problems with an employee, think carefully about timing. If an employee has just returned from any kind of protected leave, that is not the moment to act, even if your reasons are legitimate. Let them come back, address the issues formally, and create a clear record.

Document Everything

In employment disputes, documentation is often the difference between a company that can defend itself and one that can’t.

A few things worth knowing about how this plays out in practice:

Backdated write-ups don’t hold up. It’s not unusual for companies to scramble to create documentation after a termination decision has already been made. The problem is that digital files carry metadata, including timestamps. “During discovery you get the metadata and it is timestamped,” she said. “If a write-up was created the day before a termination, that’s going to raise questions a company won’t want to answer in court.”

The “straw that broke the camel’s back” firing is a trap. When there’s a final incident that pushes a manager over the edge, the temptation is to act immediately. But if that final incident is an employee calling in sick or returning from leave, the termination can become legally entangled in a protected event, even if the real reasons go back months. Her advice: “Don’t terminate them right away. Let them come back and start documenting the legitimate issues.”

A PIP isn’t the time to panic. When employees are put on a performance improvement plan, some respond by immediately applying for FMLA or another form of protected leave. That doesn’t mean the company has to abandon the performance process. But from that point forward, every step needs to be carefully documented. “We always ask people if they had been written up before their FMLA when they call us,” she noted. The answer helps shape whether a case exists.

The habit to build is to write things down in real time. If you have a verbal conversation with an employee about performance or conduct, send a brief follow-up email summarizing what was discussed. “Always get something in writing,” she said. “Best practice when there are verbal meetings is to send a short recap over email.”

Workers’ Comp and Protected Leave Are Landmines for Small Companies

It is illegal to terminate someone because they filed a workers’ compensation claim. It sounds obvious. But she’s seen it happen more than once. “Especially small companies,” she said. “Someone trips and files workers’ comp and they think, let’s just get them out of here.”

The same applies to FMLA and other forms of protected leave. An employee terminated while on, or shortly after returning from, protected leave has grounds for a claim regardless of what the underlying reasons were. She described one case where a company eliminated a position two weeks before an employee was set to return from medical leave, then advertised the same role under a slightly different title. “I go through the Wayback Machine,” she said, referring to a tool that archives historical snapshots of websites, “and pull up past job postings. The timing tells you everything.”

These cases often don’t get resolved cheaply. “We recently had a client who was terminated while going through cancer treatment. The company produced some documentation showing her productivity had gone down, but they never offered her protected leave, which was her right. The owner of the company was so adamant he wouldn’t settle, and by the time we filed in court the bill was already over $30,000.”

Harassment Claims Are Rarely Just About the Initial Incident

When employees contact employment firms about a hostile work environment or harassment, the claim often is more about how the company responded, or didn’t, than the actual incident.

A few patterns that create liability:

Moving the person who complained instead of the alleged harasser. This is a common misstep. “Companies sometimes take the person who complains and moves them instead of the harasser,” she said. “It signals to the complainant, and potentially to a court, that the company prioritized keeping things comfortable for the harasser over addressing the problem.”

Doing nothing. An employee who reports harassment and receives no meaningful response may have grounds to resign and pursue a claim, even without an explicit termination.

Confusing “people not getting along” with a hostile work environment. “A lot of times the hostile environment is just because people don’t get along,” she noted. “Not every interpersonal conflict rises to the level of a legal claim. But companies that dismiss genuine complaints as personality conflicts are taking a real risk.”

A clear, consistently followed harassment policy and a designated person who knows how to handle complaints properly goes a long way.

Small companies often operate for years without a formal HR function, and most of the time nothing goes wrong. But not knowing employment law isn’t a defense against violating it. The cases she described aren’t cautionary tales about bad intentions. They’re about what happens when nobody in the room knew what they didn’t know.

If you’re thinking it might be time for real HR support, we’re happy to talk through what that could look like for your company.