Though divorce is typically seen as a personal matter, it can also become a personnel matter. If you have an employee going through divorce, it’s not only disruptive and difficult for their private life, but may also create headaches for your business.
The employee may be experiencing stress, financial burdens and time obligations, such as court appearances. Their spouse may contact the company and ask for information that may seem questionable, intrusive or time-consuming. The potential problems are magnified when the employee is a C-suite executive, owner or someone in another high-level position with a complex compensation package — but a divorce can also be very draining on a small business, where employees tend to wear many hats and have little bandwidth for unexpected requests.
All of this may create painful distractions that weigh on an employee’s job performance, as well as the organization’s resources. On the short end, divorces can take six to 12 months to resolve, and a contentious one can take far longer. So, from a productivity perspective, an employer should be interested in reducing the amount of time the employee has to deal with their divorce. One way they can do that is by streamlining the process of obtaining needed financial documents. Doing so is a good way to support a valued employee during a troubling time, and also to protect your bottom line.
Four things a business can do to streamline an employee’s divorce:
Many businesses create needless problems, delays and unnecessary costs because they hide or refuse to provide information that the non-business spouse is legally entitled to have.
A consultation with an attorney well-versed in your state’s divorce law can help your company create policies and procedures to streamline the process, but generally, in both community property states and equitable distribution states, a non-employee spouse has a right to access information about salary, as well as information about bonuses, deferred compensation, stock options and vesting schedules, paperwork related to stocks, tax return information and other customized compensation agreements and arrangements between the business and the employee.
Be aware that the non-employee spouse has a right generally to information pertaining to the time frame of the marriage. The scope of information requested may not span to a date before the wedding day, and if the request is too far back in time than a company’s record-keeping practice, the business does not have to provide documents it does not have or maintain.
If a spouse owns a portion of the business, in a community property state — which includes Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington and Wisconsin, as well as…
Read More: 4 Ways to Keep an Employee’s Divorce from Hurting Your Business’ Bottom