As many companies know all too well, addressing disputes with current and former employees means diverting time and money from more important endeavors, such as customer service, product development and strategic planning, not to mention day-to-day operations. Addressing employment issues proactively (instead of reactively) allows employers to maintain peace in the workplace and focus on running their business, without the distraction of litigation. With that in mind, here are five of the top 10 tactics an employer can use to avoid litigation. Watch for the remainder of the list in November.

Tactic 1: Learn to Communicate

Regular, candid communication with employees is essential, not only for the working relationship to be effective, but also to prevent surprises that often lead to employee claims. This means (1) stating expectations and (2) providing feedback.

How can employers make their expectations known? For starters, ensure that the company's rules, procedures and expectations are clearly communicated to employees. Provide written job descriptions. Distribute an updated employee handbook that clearly advises employees of their obligations but is carefully worded to give the employer flexibility to deal with issues on a case-by-case basis. Conduct regular personnel meetings to stay informed about the status of tasks and problems and to keep employees informed of changes in expectations.

How can employers provide feedback? Review employee performance at least annually and point out any areas where improvement is needed. But remember that surprises are bad. Therefore, employers should not wait for annual reviews to let their staff know how they are performing or to communicate deficiencies. Feedback is important and should be provided on an ongoing basis. If problems arise, talk about them immediately and revisit the issues during performance reviews.

Always remember this rule of thumb regarding feedback: don't be nice; be honest. With that in mind, management should assess each performance review before the supervisor actually reviews the employee. Why is this step necessary? If an employee's supervisor is a friend, is averse to controversy or simply does not want to hurt the employee's feelings, the resulting review may be overly favorable and not indicative of the employee's actual performance. This mistake may come back to haunt an employer that later decides to discipline or terminate an employee for performance reasons.

Tactic 2: Educate the Workforce

Educating managers, supervisors and rank-and-file employees is critical to avoiding workplace liabilities.

Managers who are responsible for recruiting and interviewing should be trained regarding the difference between lawful, permissible questions and unlawful, prohibited questions. Even the most highly educated professionals may not realize that small talk regarding an applicant's marital status or number of children is not appropriate during the interview process.

Managers also should be trained regarding how to respond if an employee comes to them with a complaint of discrimination or harassment, or a request for accommodation for a disability or medical leave. Responding to these types of issues in a prompt, appropriate manner is critical to avoiding liability.

It has been said that a company is only as good as its worst supervisor. Therefore, supervisors should be educated as well, including training on how to conduct performance reviews (consistent with the concepts outlined in Tactic 1) and the proper documentation of day-to-day performance and disciplinary issues (discussed in more detail next month).

Additionally, companies should educate rank-and-file employees about their rights. On this point, clients often ask, "Aren't we teaching them how to sue us?" The answer is no. In fact, it can have quite the opposite effect. If a company educates its employees about their rights, they will have a much more difficult time asserting later that they didn't understand their rights or that their rights were not respected. The most obvious example is harassment training. If an employer distributes a harassment policy and then trains employees on prevention and the actions they should take if they feel harassed, the company often has a viable defense when an employee goes straight to the EEOC without ever raising the issue internally.

In the employment context, ignorance is not bliss. Educating employees at all levels of the organization goes a long way towards avoiding misunderstandings and liabilities.

Tactic 3: Maintain Flexibility

While employers should strive to treat similar cases similarly, they should remember that it is equally important to exercise discretion in appropriate circumstances. The key to success is striking the right balance between the two.

Many factors go into determining if two employees are similarly situated, such as longevity, prior disciplinary record and performance. All relevant factors can and should be taken into account when an employer determines the most appropriate way to deal with an employee issue. For example, a 45-year-old female who falsifies her time sheet should generally be subject to the same discipline as a 25-year-old male who engages in the same conduct. But if the female is a new hire who already has engaged in a litany of policy violations, whereas the male has worked for the company since he graduated from high school with no record of performance or disciplinary issues, different approaches would be justified.

Beware of strict progressive discipline policies that mandate one form of discipline before another (e.g., verbal warning for a first offense, written warning for a second offense, etc.). They can tie an employer's hands. Employers should give themselves discretion to assess the nature and gravity of an employee's misconduct when assessing the type of discipline to impose. Again, the key is to strike a balance between treating similar cases similarly and exercising discretion in appropriate circumstances.

Tactic 4: Document, Document, Document

Documentation can mean the difference between a good defense and no defense at all. This means creating and maintaining thorough records of disciplinary and performance issues. Beware, however, that poor documentation may actually be worse than no documentation at all. Accordingly, employee records must be complete and accurate.

Tactic 2 addressed the importance of educating managers and supervisors. Documentation should be a critical element of that process. In response to this recommendation, clients often say, "We don't have time to document." However, employers need not write a novel every time a performance or disciplinary issue arises. All they need is three sentences to explain (1) what happened that was bad, (2) why it was bad and (3) what will happen next time if a policy is violated or expectations are not met. The original document should be given to the employee, and a copy should be placed in his or her personnel file. As a result, the employee will be far less surprised when discipline is actually imposed, and the employer has concrete evidence that can be used to defend against an employee claim, if one should arise.

Tactic 5: Acknowledge Employee Concerns

This tactic is really as simple as it sounds. Often, a manager doesn't even need to act on an employee's concerns, as long as he or she simply validates them. Employees need to believe that they are being heard and that their opinions matter. Sometimes, just letting employees know that their managers are listening is half the battle...and can avoid a battle down the road.

So there are the first five of the top 10 tactics employers can implement to avoid litigation. Will taking these steps, in all circumstances, prevent a government audit, eliminate an administrative claim or keep an employer out of the courtroom? There are no guarantees. Using these approaches, however, can go a long way towards maintaining peace in the workplace, which allows employers to focus on running their business instead of the headache and expense of litigation.