Legal Exercise


How to avoid the long arm of the lawsuit

It was just one of those things: I was using the biceps machine at my club when I drew blood. It turned out that the vinyl covering on the armrest had ripped, and the sharp edge that protruded nicked me. It was nothing, a scratch really, and I didn't report the incident. Later, I realized I should have. Not only was I a little annoyed, but I started to wonder about all the germs that were likely living on that culprit vinyl.

While I realize equipment is prone to wear and tear, I pay good money to belong to the club, and a staff member should have at least placed a temporary covering over the rip to protect the members. The club was lucky and so was I. It was a minor injury; eventually the rip was repaired, and life went on. But I often wonder how many clubs let something slide or don't handle a situation well and set themselves up for problems.

In the world of the health club, so much can go wrong. Something seemingly simple - a broken piece of equipment, a wet floor in the locker room - could well result in a serious injury and even a law-suit. That's why it makes sense to take precautions not only to protect your members, but to protect yourself.

"It's probably accurate to say that there are surprisingly few lawsuits filed against health clubs considering the types of activity that go on at them," says Michael Sklar, a partner at Rudnick & Wolfe, in Chicago. "This probably speaks well of the level of training, planning and warnings that club owners provide to their staff and members."

That's not to say claims and lawsuits never occur. But when they do, "they can generally be handled and settled," adds Sklar.

Still, it's good business practice to make sure you never end up being one of the unlucky clubs that has to hire a lawyer. How can you do this? "Good planning, good membership relations and good training for your staff" are key to lowering your risk, says Sklar.

Here an overview of some of the steps you can take to avoid a legal encounter:

* Train your employees well. Put programs in place that will teach your staff how to deal with members in a way that will "avoid antagonism and sexual harassment and keep them from feeling as though they're being mistreated," advises Sklar.

* Make sure your staff members are credentialed. "Trainers and instructors should be certified by an appropriate training institution, or if not certified, certainly trained sufficiently, so they won't cause injury to people during exercise or push people beyond their reasonable limits," says Sklar.

* Make sure your membership contract has an appropriate waiver of liability clause. "Many states will recognize the right of a club to have their members waive the right to make a claim for personal injury," explains Sklar. "There is an assumed risk in working out at a health club." So check with your lawyer.

* Focus on building good member relations. "Treat people with respect," advises Sklar. And follow the "customer is always right" adage.

"When there's a disagreement between a member and a staff person, if there's any doubt about who's right, defer to the member," adds Sklar. An angry person who has cause is often likely to take action against you. "Litigation is a pretty extreme result," says Sklar. "People don't file lawsuits at the drop of a hat. It takes a lot of effort. It's good for member relations to keep people happy, and you do that by bending over backwards to accommodate them, even when they may be wrong."

* Post announcements warning members of risks, not only to themselves but to their property. "That's another way to avoid claims," says Sklar. Alert members to the fact they have to use protective eyewear in a tanning booth (some regulations require that clubs provide goggles); that they should not use the sauna if they have certain health conditions; that they should use caution on the floors around the shower area; that they shouldn't leave valuables unattended.

* Have your advertising reviewed by a lawyer, particularly if you're running an aggressive campaign. If you promise to deliver certain types of memberships and you don't sell them, you could be investigated by your state's attorney general or the consumer protection agency. A case in point: A club promises a cheap membership and when a person tries to buy one, he is told there are none left, and is offered one that costs twice as much. Fortunately, says Sklar, "most operators of health clubs today are honest businesspeople and don't get themselves into these kinds of situations."

* Be prepared for health emergencies. Many states or municipalities require one person on the premises at all times who is trained in CPR, notes Sklar: "If you don't meet that criterion, you've broken the law and there is a presumed negligence associated with that."

* Maintain your facility and equipment. Make sure floors around wet areas are mopped up or protective matting is put down. Keep equipment in good working order.

If an injury is due to defective equipment and is the fault of the manufacturer, you may be able to file a products liability claim, notes Sklar. But in order to do this, you need to keep track of warranties. If you've let maintenance slip and the equipment is fine, you're the one at fault.

* Call the police if tensions rise. "To some extent, you have to protect your members," says Sklar. "Still, you have to act prudently in every situation." If a member acts especially hostile towards another member, or angrily confronts a staff person, try to calm him down, but get the police there as soon as possible, advises Sklar.

* Have an emergency plan in place (and make sure you have good personal injury insurance). If a member injures himself or suffers a heart attack, for example, take action. "You have to do a very quick assessment of the circumstances and call the paramedics," says Sklar. When possible, get the names of witnesses and record their observations. In the case of litigation, you'll need to give these to your insurance company.

* Make sure your facility is accessible to people with disabilities. Under the Americans with Disabilities Act, you need to make sure that disabled people can get to, and have access to, the core features of your facility. While exercise studios and equipment certainly qualify as core features, "each case stands on it own," says Sklar. "Most people err on the side of caution and assume washrooms and wet areas, such as showers, are an integral part of the facility and make them handicapped-accessible."

* Establish credit procedures that are fair. If you're trying to collect money that people owe you, you have to do it in compliance with the law; if you don't or if you misrepresent the terms of the credit, you can be accused of credit abuse, deceptive trade practices or violating the Federal Truth in Lending Act. One way to avoid these situations is to bypass the extended membership payment plan and have people pay you on a monthly basis. "You deliver a month of service and get paid for it one month at a time," says Sklar.

* Don't take complaints lightly. "I would venture to say virtually every health club owner has had some complaints made directly to him or to an agency of some sort," says Sklar. "But they're limited in number, and should be limited. If there are a lot of them, then the health club owner needs to take a look at how he does business."

* Don't panic if the worst-case scenario happens. "An ounce of prevention is worth a pound of cure," says Sklar. "Have procedures in place and written policies so that you show that a bad act is an aberration. You want to show the lawyer or judge that what happened is not your company policy. It is your policy to do the right thing. If you show you've taken steps to correct the situation, improve your policies, and take action against employees who violate the policy, that can go a long way towards reducing any damages you may suffer or limitations an agency may place on you."

Legal Terms at a Glance

"There's no need to run your business under a mantle of fear," says attorney Michael Sklar. "If you run an honest business, try to deliver value for money, and understand the basic principles of law in terms of how you need to operate your business, the chances of your incurring a serious lawsuit or restriction from a consumer protection agency are slim." Still if you should happen to find yourself at the receiving end of a legal action, it helps to know the language. Here's a quick guide to the three legal actions you could face:

* A lawsuit is a generic term that refers to any proceeding, usually in a court of law, in which somebody is a plaintiff and somebody is a defendant.

* A claim is a complaint somebody has that he or she wants formal redress for, but hasn't filed a lawsuit. "If the individual doesn't get satisfaction and the claim isn't settled, the person making the claim can file a lawsuit," says Sklar.

* An administrative proceeding is a formal proceeding that could take place within a law enforcement agency, such as a consumer protection group, an employment discrimination agency, or the Federal Trade Commission.

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