We will write a custom Report on The NovySmichov Store’s Risk Management specifically for you
301 certified writers online
The NovySmichov store is one of the leading retail stores in Prague. The store management has realized that legal compliance and accountability are critical in reducing its legal liability. For instance, the NovySmichov store has realized that its relationship with customers, employees, and other associates is likely to be subjected to unending legal tussles. This happens due to legal obligations in such relationships. This risk management report highlights areas of tortious risk involving employees and customers and how they can be mitigated.
Law of tort
A tort is a wrongful act that causes harm or damage to a person in different ways (Davies 135). It can either be intentional or unintentional. Unintentional tort is also referred to as negligence. Unintentional tort provides a basis for malpractice cases in many litigations. On the other hand, intentional tort is a conscious act when a person is aware of the act and its foreseeable consequences. Examples of intentional tort are assault and battery, defamation, among many others (Davies 135).
Areas of tortious risk involving the Company and employee
Assault and battery are the first area of tortuous risk that is likely to affect the NovySmichov store. For instance, an employee can claim that he/she has been sexually harassed or assaulted by the supervisor in the workplace. This may make the store liable because harassment in the workplace is prohibited under the law. Secondly, employee’s emotional distress as a result of harassment is another area of tortious risk (Geistfeld 264). The store would be vicariously liable if an employee files a complaint for emotional distress in the workplace.
Privacy risk is likely to affect the NovySmichov store. An employee may sue the store for failing to protect his or her private information. In addition, the store may be sued for its failure to protect employee’s privacy while conducting his or her duties. Finally, occupational health and safety are also an area of tortuous risk for the NovySmichov store. Employees are bound to be injured while being on duty. They may choose to write a complaint against the store for the injuries sustained in the workplace.
Areas of tortious risk involving the Company and customers
Employer’s liability is likely to occur in the NovySmichov store’s relationship with customers. The first risk area is the product liability. As a vendor of consumer goods in the city, the NovySmichov store is likely to encounter claims of selling defective and unsafe products. For instance, the customers are likely to sue the store for harm or injuries sustained from the use of the products.
Secondly, the customers may also sue the NovySmichov store for injuries they sustain while shopping. For instance, if a customer slips and falls, he/she may be injured. The customer may choose to sue the store for not displaying “slippery floor” notices in the premise. In addition, the customers can claim an intrusion into their private information by the store employees. The store uses customer redeemable voucher cards to build customer loyalty. The customer may claim that the store used his/her private information for business purposes. Therefore, the company may be sued for infringing customer’s privacy rights. Finally, the customers are likely to sue the store management for assault and battery if they are directly insulted by junior employees. Employees working in the luggage bay are often frustrated by customer’s disturbances. Confrontations between the store employees and customers are likely to lead to legal actions against the company.
What risk management strategies appear to be already in place to minimize risk?
The store is currently employing a number of risk management strategies in the workplace. Firstly, the store has installed safety notices within the premise to prevent employee’s injuries in the workplace. Secondly, the store code of conduct prohibits supervisors from any form of employee’s harassment. In addition, the store has a clear conflict solution procedure.
In addition, the store has a clear product policy that ensures that quality products are sold by the store. It works closely with its suppliers to provide that quality products and appliances are sold by the store. This has helped the store to reduce customer complaints about defective products. In addition, the customer loyalty information is censored and not accessed by tellers or any other junior employee in the store. The top managers are only allowed to access the information upon customer’s request.
What further risk management strategies could be applied to minimize risk?
NovySmichov store should take initiatives to mitigate the above mentioned tortuous risks. According to Power (59), tortious risk management calls for adoption of policies and techniques that are aimed at enhancing a legal relationships between the company, customers, staff, and other business associates.
To avoid employee’s litigation with regard to their health and safety, the store should put in place proper maintenance and inspection of its premise and facilities to minimize workplace injuries. This will help avoid the likelihoods of tortious suits against the company. Secondly, they also need to train the supervisors on their role in reducing incidences of employee’s harassment. This will call for the store management to engage the company legal officers in provision of guidelines on legal issues in the workplace. To minimize customer tortious claims, the store should install a new system to ensure that only authorized people within the organizations can access customer’s information.
What defenses could be available to the company if a customer took legal action for each of the identified areas of risk?
The legal team will have to assess the customer’s claim in order to ascertain its application in the relationship of the store with the customer. The legal team will have to substantiate the legality of the action by the customer and present an urgent petition to stop the action pending further investigation by the store for the alleged tortious claim.
Get your first paper with 15% OFF
The legal team will reassure the store management that customer’s lawsuit does not imply that the store is at fault. In its submission, the legal team will have to demonstrate that the store has not caused any injury to the customer. The legal team will require the customer to demonstrate that the store had a legal duty to provide him or her judicious care. Secondly, the customer will be forced to explain whether the NovySmichov store acted in breach of its duty that lead to his or her injury. Finally, the legal representative would also require the customer to explain how the breach of duty by the NovySmichov store is related to the injury.
It is critical for the NovySmichov store to be aware of its legal obligation in its relationship with clients and staff. This helps in reducing the legal tussle and employer’s liability. From this report, it is evident that there are a number of tortious risks that are likely to affect the store. The report also points out the mitigation strategies that can be used to mitigate the tortuous risks. This is important in reducing the NovySmichov store’s vicariously liability.
Davies, Paul Lyndon. Gower and Davies’ principles of modern company law. Vol. 388. London: Sweet & Maxwell, 2003. Print.
Geistfeld, Mark A. “Tort Law and the Inherent Limitations of Monetary Exchange: Property Rules, Liability Rules, and the Negligence Rule.” Journal of Tort Law 4.1 (2011). 34-38. Print.
Power, Michael. The risk management of everything: Rethinking the politics of uncertainty. Demos, 2004. Print.