how should I respond to an employee who threatens to sue?

A reader writes:

How do you respond to employees who threaten to sue or get a lawyer? Would you consider employees’ threats to sue or get a lawyer to be a major red flag?

I realize there are circumstances when the employer is in the wrong and it’s necessary to get a lawyer involved. But as a manager, I’ve had several circumstances where my employees have told me they’ll sue or get a lawyer. Generally I take it seriously and run it past someone more knowledgeable than I. And in all cases, they had no standing. It was an empty threat. But it tells me that someone is eager to sue, or at least threaten to, and isn’t someone I want on my team.

I had one employee, who we had other issues with, who threatened to sue both me and the business (the reasons were unclear). After that, I never had a one-on-one meeting with him without someone else present, as I did not trust him.

The best response to an employee who says they plan to speak to a lawyer is some version of, “I encourage you to do that so you’re fully informed of your rights. For now, though, what we need is…”

I don’t think it’s inherently a red flag that the person is “eager to sue”; most of the time when someone threatens to sue, it’s an expression of frustration — they feel something unfair is happening, and (particularly because so many people don’t have a good understanding of American employment law) they feel there must be a legal remedy. It is a sign that the relationship has broken down in some way. I’d think of it as closer to a cry for help than anything else; rightly or wrongly, this is an employee who feels they’re being mistreated.

It’s a sign that you need to make sure you’ve listened to their concerns and tried to understand where they’re coming from. You ultimately might not agree with them, but whatever comes next will be easier if you at least listen with empathy and an open mind, and that itself can deescalate things. If you instead move immediately to an adversarial framework — rather than seeing them as someone expressing frustration — you miss the chance to do that.

Now, sometimes the person thinks they’re being mistreated for an absurd reason, and it reflects a judgment problem more broadly. But the judgment problem would be about threatening to sue over this specific absurd thing, not about referencing legal counsel in general. (Although it’s also true that if they’re really planning to pursue legal action, they should just do it; threatening is kind of a hothead move and it won’t be particularly useful in most cases.)

Other things to know: an employee asserting their legal rights is engaging in legally protected activity, and you can’t retaliate against them for it. (And lawyers will tell you it can be much easier to prove retaliation than to prove whatever the initial underlying complaint was.) You should continue treating the person the same way you would have before they made the threat. But you should also document the interaction and the issues surrounding it as thoroughly as you can, and you should make sure your HR or legal team is looped in.