We’ve seen the high profile lawsuits, with their big names, big companies, and big dollars. The dollar signs may not be quite as big for small businesses, but in some ways these types of claims can be even more damaging. Many small businesses may be so small they are not liable under state or federal anti-discrimination laws, but it doesn’t mean the owners can’t still find themselves liable in the court of public opinion when they fail to prevent, properly investigate, or correct harassing behavior. At best, they can find themselves spending way too much time managing workplace turmoil and way too little time focusing on their workplace’s productivity. At worst, that time, money, and lost productivity can shut them down entirely.

With just a few proactive steps, small business owners may be able to protect themselves from the reputational, financial, and productivity risks of a sexual misconduct or harassment claim.

1. Know how many employees you have and whether you fall within the threshold for state and federal anti-discrimination laws to apply. Federal Title VII, which prohibits discrimination or retaliation on the basis of race, color, religion, sex, national origin, or pregnancy, and the Americans With Disabilities Act (“ADA”) kick in at 15 employees, and the Age Discrimination in Employment Act (“ADEA”) kicks in at 20 employees. The Tennessee Human Rights Act (“THRA”), however, covers employers of 8 or more employees, and the Tennessee Handicap Act (“THA”) covers all employers regardless of the number of employees. Furthermore, if you have even one employee you are covered by the Equal Pay Act, which requires employers to provide equal pay for equal work to male and female employees.

2. If you have 2 or more employees, you have mandatory posting and recordkeeping requirements, including requirements that remind employees about their rights under the laws. The Tennessee Department of Labor & Workforce Development keeps an updated list of mandatory and recommended state and federal posters at www.tn.gov. Even with just one employee, you are required to keep payroll records for at least three years, and all records for at least two years that explain the basis for paying different wages to employees of opposite sexes in the same establishment. Additional requirements apply for employers with enough employees to fall under Title VII, the ADA, ADEA, or other Tennessee state laws.

3. If you are growing and likely to hit the threshold number of employees soon, develop and publish an anti-harassment policy now to ensure you’ve instilled the proper modicum of respect in your workplace. Don’t wait until you’ve already hit the threshold to start the process.

4. While you’re at it, develop and publish an anti-bullying policy. Tennessee has just extended its Healthy Workplace Act to private employers. This act is an anti-bullying statute. It does not create a new cause of action based on bullying in the workplace, but if employers adopt an anti-bullying policy that complies with the act, employers may be immune from suits for an employee’s abusive conduct that results in negligent or intentional infliction of emotional distress.

5. Remember that anyone can potentially engage in harassing behavior. The business owner, managers, employees, customers, or vendors can all be responsible for creating a harassing environment. If you see someone engaging in potentially harassing behavior, don’t ignore it. Stop it before it gets worse, or you may be defending yourself against allegations you knew about the behavior and implicitly condoned it.

6. Also remember that harassment isn’t just sexual harassment. It can arise when anyone is treated differently or singled out because of a characteristic protected by law.

7. Know who to turn to if a complaint does arise. Will you be handling it on your own, or can you turn to a human resources professional or an outside party to do it? If you are handling it on your own, can you conduct the investigation without an actual or perceived conflict of interest affecting the outcome? If you turn to a human resources professional or outside party to do it, what specific training does that person have and knowledge of your business to ensure a complete, thorough, and impartial investigation?

8. Get training. If you’re handling the complaints, you need to be trained in how to conduct investigations. That starts with knowing what to do with the complainant and the accused during the course of the investigation, knowing what questions to ask and who to ask them of, what documents to collect and how to retain them, and then what to do when the investigation is complete. If you turn to a human resources professional or third party to conduct the investigation, make sure that person has also been trained to conduct these types of investigations.

9. Get anti-harassment training for everyone involved in your business. This training can include information regarding the type of behavior that can be considered harassing, how to recognize it, how to react to it, how to complain, and how to respond to those complaints. Remember that this training is not just one-and-done, either. Incorporate it into your new employee orientation process and as part of periodic employee training. You can even incorporate some form of anti-harassment message into the agenda of all employee meetings.

10. Create an environment where your employees feel safe to speak up. You can’t fix what you don’t know about, but you also cannot intentionally turn a blind eye to concerns, refuse to hear them, or worse yet, retaliate against employees for coming to you in good faith with their concerns.

Emily Hunter Plotkin is an employment law attorney and mediator based in Tennessee. Emily welcomes inquiries about her services, which include counsel on workplace rights and obligations and manager and employee training on legal compliance, employee management, and workplace conduct.