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Owners, Protect Yourself: Employee Lawsuits at Fitness Clubs are on the Rise

employee lawsuits

We live in a litigious society. No one is immune and some businesses are more frequent targets for lawsuits than others. Gyms and fitness clubs top the list.

Club owners are accustomed to being the targets of unhappy members who may slip and fall on a wet floor or a treadmill through lack of proper training or distraction.

We take care to make sure we have liability insurance in place to protect us from those members who sue. However, when it comes to being sued by an employee, many club owners think that just won’t happen to them. It’s time to think again because lawsuits filed by fitness club employees against their employers are on the rise.

Most of the claims brought against club employers involve sexual harassment or discrimination.  The lawsuits have become so widespread that the courts have made it mandatory for health club employers to maintain a written policy regarding sexual harassment and discrimination in the workplace.

Wrongful termination, discrimination, invasion of privacy, and sexual harassment all fall under the category of Employment Practices Liability.   

Up until a few years ago, most business owners never worried about this exposure and even today, the vast majority of club owners don’t understand the ramifications of what an employment related lawsuit can do to their business.   Frequently, these lawsuits are accompanied by a complaint filed with the Equal Employment Opportunity Commission (EEOC).  This bureaucratic agency tends to take the attitude that you are guilty until proven innocent.  They are not pleasant to deal with.   Needless to say, employment related litigation is costly, time consuming, and emotionally draining.   

Develop or Purchase an Employee Manual

As a health club or fitness center owner, you need to take this issue very seriously. A first important step is to either develop or purchase an employee manual created specifically for the health club industry.  The manual should outline what is expected of your employees and address anti-discrimination and anti-sexual harassment policies.  Once you have an employee manual, make certain that all employees have access to it and be prepared to follow your rules and employment related procedures to the letter.  The underlying theme of a good employee manual should emphasize a common theme; “All men and women are created equal.”

Keep this in mind: the courts have continuously held that the employer is held accountable for the actions of their employees.   In other words, if you have a manager or trainer who tends to be a little too “friendly” with certain aerobics instructors, you could be held liable for that employee’s actions.   Treat everyone the same and practice zero tolerance regarding any form of harassment.  

In addition, you’ll want to re-evaluate your management procedures, which must include your own behavior.  Here’s a helpful hint; don’t date your staff.

Purchase Employment Practices Liability Insurance

The smartest thing you can do once you have your employee manual and management procedures in place is to purchase an Employment Practices Liability Insurance (EPLI) policy. Be prepared for the worst-case scenario. As a business owner this just makes good business sense. The health club business is tough enough without the added distraction of dealing with the EEOC and your ex-employee’s attorney.   

If you are interested in ordering an updated employee manual or obtaining EPLI coverage, please contact me at ken@clubinsurance.com.