My question involves defamation in the state of: TX
My wife and are partners with her sister (yes family should not do business together) and have some major problems.
To give a little history the sister(in-law) and I are managers of the company, in most cases she is in charge of handling disciplinary issues with employees but in no way is there anything stating that she is the only or last word.
We've had occasion where employees essentially refuse to do their job and if it's something she chooses not to deal with (usually because she's friends with the employee) she asks me to do it. When I do the employee cries to her and she often apologizes for my actions and without telling me reverses my directives.
The last time she did this I confronted her about it and she then proceeded to inform me that she is in charge of the employees and I have no say in the matter.
Well as with any business owner that is not going to work. We tried to discuss it further and when she was informed that she would not be allowed to do that again she went into a screaming fit (much like a teenage girl who had her cell phone taken away) ran out of my office down the hall and out the door. All for the benefit of the employees in the office at the time. Since then there has been zero discussion between us, and she has told her story to pretty much every employee in the company. The problem is her story is where the slander comes in. She has told folks that she has uncovered signs of me taking large sums of money from the company account. The gossip has gotten so bad that our competitors know about this and are using it to recruit our best employees.
To make matters worse she is in charge of billing clients and has chosen to bill just barely enough to allow me to make payroll. My assumption is that if I end up unable to make payroll she'll do the "I told you so" routine to the employees when we hand them an IOU. Her way of supporting her lies!! I've also heard rumor that she is spreading information from some employees personnel files as a way to turn folks against those employees that she feels may not choose to take sides with her.
With the exception of pointing out direct lies to those who've asked, my wife and I have not spoken about any of this with our employees or anyone else outside of the company.
What to do??????