Cost of Conflict in Business

When conflict affects business and personal relationships, the disagreement stands to cost more than just the dollar value of hiring lawyers. The financial and emotional effects, wasted time and lost productivity of both businesses and individuals contribute to the overall costs. In situations of conflict, your business might suffer from

  • Increased gossip, hostility and avoidance of contact.
  • Increased exposure to liability in the areas of personal injury, worker’s compensation, healthcare premiums and disability claims.
  • Increased chances of strikes and walkouts.
  • Decreased constructive communication among employees and management.
  • Increased healthcare costs due to the physical manifestations of emotional stress.
  • Increased absenteeism.
  • Reduced ability to retain valuable employees because of increased employee turnover and increased cost of training new employees.
  • Inability to attract valuable employees and a decline in reputation in the community and with other businesses.
  • Possible increased workplace violence due to frustration among employees.
  • Decreased morale, leading to apathy.
  • Reduced loyalty to your company.

If allowed to continue, costly litigation will likely follow.

A recent Rand Corporation study found that:

  • Juries award an average of $700,000 to employees in wrongful termination suits.
  • The EEOC annually receives 80,000 discrimination complaints.
  • 15,500 sexual harassment cases are filed annually in courts.
  • Juries side with employees in 70 percent of workplace litigations.
  • Juries award damages in 55 percent of the claims filed.
  • Punitive damages in racial discrimination cases average $6.4 million.
  • Average punitive damage award in employment cases is $2.7 million.