Obey the laws regarding employees. Don’t discriminate in hiring, for example, or permit sexual harassment.
Hire carefully. Look for people with a strong work ethic, and avoid hiring those who feel life owes them something.
Adopt strong employment policies. Communicate them clearly to employees and enforce them.
Keep good records of employee mistakes. Even when they’re not firing offenses, make sure you document your own actions and the reasons behind your employment decisions.
Consider buying employment-practices liability insurance (EPLI).