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How to Reduce Risk for a Lawsuit That Could Ruin Your Chauffeured Transportation Business

Last updated on April 30, 2012 by Sozo Staff

When your business involves many hours spent on roads and highways, accidents are an unavoidable risk. But lawsuits in the limo industry don’t just come from collisions. Often times, class-action lawsuits and other legal actions are brought from within an organization.

An expensive lawsuit can easily sink a small business and leave a business owner struggling to find a buyer. Nothing scares away investors from buying a limousine business like liability. Even if you don’t have plans to put your limo company for sale anytime soon, your company’s value hinges on your reputation. By doing what you can to protect against lawsuits, you’ll be protecting your bottom line.

Treat Employees Well

This probably goes without saying, but treating employees fairly creates an overall happier atmosphere. Treating employees carelessly will naturally breed resentment. While being a good business doesn’t make you immune to lawsuits, burning fewer bridges certainly helps reduce risk. When a chauffeur business works together as a team, grievances are more likely to be aired and managed appropriately. There will be less incentive for former workers to bring a bogus and potentially damaging charge against the company if they were on good terms with most everyone there. Additionally, contented employees are more likely to treat customers well and pay close attention to safety, reducing risks of legal action from outside the company as well as inside.

Enforce Policies and Procedures

Policies and procedures not only keep a business running smoothly and efficiently, but they can also prevent many types of litigation. When employees are familiar with expected company conduct – and know the proper method for alerting management when that conduct is breached – the company will be in a better position to defend unfounded claims of harassment or discrimination. Of course, this only holds true if policies are consistently carried out. If a business owner is lax about enforcement until an incident occurs, it can actually work against the company in court. It can be difficult to enforce rules, especially in a small business where employees work closely with one another. However, establishing and following a protocol is safer for workers, customers, and your company.

Keep Good Records

You may be in the right, but can you prove it? It’s not enough to follow proper business practices. Business owners need to document every detail of operations. From fitting your fleet with cameras to recording every action taken against employees with a paper trail, maintaining records is your best legal defense. If you’re not already, begin evaluating employees on a regular basis and provide written warnings for those who aren’t performing up to par. Let’s say a driver fired for poor conduct had consistently arrived late to pick up customers. If you can show the employee was disciplined in the past, a judge will be more likely to throw out claims of unfair dismissal.

In today’s lawsuit-happy society, it’s impossible to eliminate all risk of liability. However, running a tight ship and leveraging the advice of a good attorney with experience in the limo industry improves your odds. When you do decide to put your limo business for sale, a clean legal record can boost buyer interest.

Filed Under: Transportation

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