Unfortunately it’s easy for companies to make mistakes when downsizing that lead to costly and time-consuming lawsuits.

Learn how to avoid some common pitfalls when downsizing from Knowledge@Wharton, the Wharton School’s online business journal, in this conversation with Wharton management professor Peter Cappelli.

Even when companies have a clear strategy for their layoff plan, they often do not “prepare front-line managers for how to execute the plan — and it ends up in lawsuits,” Cappelli says. In a layoff environment, “people start suing,” and in a down economy, “they often win higher damages.”