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Navigating Labor Shortages and Minimizing Business Liability

By Alliant

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While the Great Resignation has come and gone, adequate access to qualified workers continues to be problematic. According to the U.S. Chamber of Commerce, employers may be experiencing a shortage of workers for a variety of reasons, including individuals reevaluating their employment priorities and seeking improved work-life balance and flexibility, increased compensation or a strong company culture. What is now being called the Great Reshuffle continues to challenge the labor market, and the risk to businesses can be significant. For instance, a depleted workforce can lead to current employees being overworked and employers having to hire inexperienced or less qualified workers to fill available positions. These issues can increase employee mistakes or involvement in accidents on the job, which can create elevated business liability risks. Therefore, it is critical for employers to take proactive steps to mitigate labor shortages and related liability concerns.

Business Liability and the Workplace

While certain industries are more susceptible to increased risk due to limited access to workers, all businesses may occasionally need to schedule fewer employees per shift - leaving them overworked - or hire lesser-skilled employees to fill job openings. The impact to businesses can include:

  • An increase in workplace accidents due to employee exhaustion or inexperience, resulting in harm or injury to both employees and customers.

  • Service delays and missed deadlines due to overworked and inexperienced employees, leading to disgruntled customers and potential liability problems.

  • Property and inventory losses as a reduction in workers can make it difficult to maintain workplace security.

Understanding how to minimize elevated liability risks during labor challenges involves several measures:

Establish effective onboarding procedures.

  • During labor shortages, it is essential to have appropriate onboarding protocols in place, particularly if employers are hiring inexperienced workers. These protocols can provide new employees with the necessary knowledge and resources to perform their roles safely and effectively.

Ensure all workers receive regular, job-specific safety training.

  • Regardless of their experience, it is essential for employers to provide routine training to their employees. This training can help foster a culture of safety and reduce the risk of workplace accidents and injuries, as well as related liability concerns.

Establish a regular check-in schedule.

  • It is vital for employers to maintain frequent communication with their workers. Consistent check-ins can motivate employees to share any safety concerns or other work-related issues that arise, allowing employers to address these problems before they cause liability incidents.


How Can Alliant Help?
Alliant offers creative and powerful strategies with onsite consulting services to help clients effectively respond to the ever-changing circumstances and regulatory landscape. We offer a team of leading specialists to support key loss drivers and exposures.

Our all-inclusive Risk Management Center (RMC) platform creates effective risk mitigation programs for employee safety and compliance. This unique and robust web-based suite of safety and risk management tools provides a risk reduction and safety center for all departments and locations across client organizations, designed to make risk prevention efforts more impactful, cost effective and easier to manage.


Alliant note and disclaimer: This document is designed to provide general information and guidance. Please note that prior to implementation your legal counsel should review all details or policy information. Alliant Insurance Services does not provide legal advice or legal opinions. If a legal opinion is needed, please seek the services of your own legal advisor or ask Alliant Insurance Services for a referral. This document is provided on an “as is” basis without any warranty of any kind. Alliant Insurance Services disclaims any liability for any loss or damage from reliance on this document.