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protection for your small business?

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Nashi

Junior Member
What is the name of your state? KY


What, if any, protection does a small business have from subtle harrassment by vindictive ex-employees?

This is going to take a bit of explanation, I'm afraid...

My husband and his partner run a very successful business, but over the past few years they've had a string of "bad luck."

Almost every time they've had to let a problem employee go, they would suddenly have to deal with things like visits from the EPA, the Labor Board, OSHA, and worst of all the IRS.

The Labor Board and OSHA found nothing - their investigations were brief, too. The EPA also found nothing out of order aside from some old fuel tanks buried on the business' property which the EPA already knew about - My husband and his partner had been working with them to get the old leaky tanks out and the surrounding soil replaced, in conjunction with the previous owner of the property who lied about the existence of the tanks when he sold the business buildings and land to us.

The IRS audit did turn up a couple of problems, but they were either simple bookkeeping errors or the fault of the account - bad advice and the like. (There is currently a class action suit being filed against her by numerous small businesses - so, you can see, it was not just a case of us looking for a scapegoat.) But this audit took TWO years to resolve - we finally hired a new accounting firm who stepped in and managed to wrap it up. The business paid some back taxes and late penalties the IRS determined were owed and everything returned to business as usual with a the new accounting firm setting up a new bookkeeping system and fixing any existing problems left over by the old accountant.

But, it's always been right after a problem employee has been let go that the audits and inspections came up. We were even told, the first time this happened, that the 'disgruntled' ex-employee intended to stir up trouble and see that our business would be shut down by the end of the year.

He stirred up problems for several years, and we believe this man, the first one we had to fire, has been involved in one way or another with other problems. We know, but couldn't prove, that he encouraged an employee to file a fraudulent workmans comp. claim. We had evidence and his claim was investigated. Yet, dammit, they approved his claim, because it would cost them more to litigate. At least we were able to legally terminate him after the incident.


Now, it's happened again. We recently were informed by an attorney that we needed to do some 'restructuring' and that we needed to eliminate a position.

The employee holding the position was let go not long ago. Ironically, within two weeks of his termination, the business was showing higher weekly profits than it had ever experienced. Funny how that worked out, eh?

A few more weeks passed before the business received a letter from the IRS, stating that they would be conducting another audit!

We know these audits and inspections have been instigated by the guys who were fired, we've been told, heard rumors and hints and so on, but we can't prove anything.

(In hindsight, better security measures, including more cameras, keyloggers on the computers, etc, might have helped. I even suggested hiring a PI when certain evidence came to light - all kinds of security measures were my idea, but were brushed aside.:mad: My husband is a 'born again' Christian and is always trying to give people the benefit of the doubt right up until the point where he realizes he has 'no more cheeks to turn' and that he's been taken advantage of again.)

The business hasn't suffered a major blow by any of these retaliations, but I'm concerned that it's only a matter of time before one of these guys finds a way to cause some serious damage. The most recent employee released is a major concern to me. We believe he was involved in a lot of unsavory things many of which were brought to light during his last month or so in our employ - he grew very careless and over confident; dare I use the analogy of a sociopath who had finally reached the point where he was losing control? What is the term? Decompensation, I believe.

We've always run our businesses honestly and ethically; trying hard to meet all the requirements set by state and federal agencies. And aside from following bad advice from the one accountant, and a couple of minor oversights, the business has done well.

How can a small business protect itself from this sort of thing? Is there anything that can be done?

Does anyone have any advice? Has anyone gone through anything like this themselves?

I'm at the end of my rope. Every incident like this causes me to lose a little more faith in people in general. I've become even more cynical than ever. I am always suspicious of any new employees. I don't trust anyone new who attempts to get too close or is too friendly. If someone does something nice for my husband and his partner or offers help, I immediately start analyzing the situation wondering what they're up to and what's in it for them.

I'm sorry for the long-winded post, but I believe the details were necessary for you to understand the gravity of our situation. And if it is happening to us, I feel sure that this has happened to others.

If anyone can offer insight or advice I will be grateful; I will appreciate anything at all.

Thank you.


[BTW, I don't own any part of the corp. Using terms like 'we' and 'our' was my attempt to avoid having to use long awkward descriptions. And since it is my husband's business, I tend to think in terms of 'ours' anyway. :) ]
 


pojo2

Senior Member
My question would be does the hubby have the intestinal fortitude needed to own his own business?
 

Nashi

Junior Member
Huh?

pojo2 said:
My question would be does the hubby have the intestinal fortitude needed to own his own business?

What kind of question is that? :confused: And what does it have to do with my question?

FYI - He's owned and run his current business for over 10 years (we are both only in our mid 30s) and has managed to do so quite successfully in spite of the interference and difficulties caused by the troublemakers he's had to fire.

The business has grown to be the largest and most well-known and respected of its kind in the area where it is located - to the point that they have no major competition left.

My husband and his partner deal with the bull - we all do, families and other employees, as well - but that doesn't mean they like it, nor does it mean it's not frustrating and stressful. The problems they've had thrown their way, have not prevented them from doing what needs to be done, including firing employees they know are likely to cause them more problems.

Yet their business is still considered a 'small business.' And while all of the attempts to disrupt business have done little damage - so far - they are major nuisances and amount to harrassment IMO. Anyone who has ever had to deal with an IRS audit knows it's not a pleasant experience. And the last audit stretched on for two years! Meaning long meetings with auditors, then when it looked like things were finally coming to a close, there would be more paperwork or another issue that needed to be addressed.

I absolutely despise people who resort to such spiteful behavior when they darn well know that it was their own fault they were let go in the first place - slacking off, not taking reprimands seriously, not making the effort to use second chances to improve their performance, stealing from their employers in one form or another, and not accepting that the blame for being fired lies with no one but themselves.


I just wanted to know if there isn't a way to protect businesses from this kind of harrassment. He deals with it and handles it remarkably well. I just don't think he or any other small business owner should have to which is why I'm asking about this.

Now I'm also wondering why you are questioning my husband's ability to run a business. He's quite capable, thank you very much! :mad: Just because he gets tired of cleaning up messes made by ticked off, vindictive ex-employees doesn't mean he can't handle it. If that were the case, he'd have thrown in the towel years ago.
 

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