Why Your Business Needs Employment Practices Liability Coverage

Posted March 21, 2018 in Employment Practices Liability

The number of lawsuits filed by employees against their employers has been on a steady rise. Without proper coverage, companies can find themselves at a major loss or out of business altogether. With more and more claims hitting employers, the need for Employment practices liability insurance (EPLI) has never been higher. EPLI protects against wrongful acts in the employment process, including alleged inappropriate workplace conduct. EPLI protects officers, management personnel and employees against employee lawsuits, and this type of insurance is available either as a stand-alone coverage or part of a management liability package.

Employment practices liability insurance gives you the peace of mind to know that your company will be taken care of if an employee decides to file a claim. Our insurance specialists at Gallant Risk & Insurance Services, Inc. can provide you with the information you need to know about EPLI. Call 951-368-0700 or complete our online contact form to reach us.

What Does EPLI Protect Against?

Discrimination

Employment practices liability insurance covers businesses for claims made by either current or former employees (or interviewees) who cite discrimination as the reason they were either fired or not hired or why they received different treatment than others. This alleged discrimination can include but is not limited to, sex, age, race, religion, national origin or disability.

Harassment

Harassment claims, both sexual and other, are among the most common (and recently most vocalized) types of claims.

Wrongful Termination

While wrongful termination can be related to both of the above, wrongful termination claims can be made by any former employee, whether that employee was recently terminated or if time has passed. This type of claim can include alleged retaliatory termination. EPLI is especially important in handling situations like this because even if the termination was due to poor performance, lack of attendance or personal conduct, a disgruntled terminated employee could always come back with a claim.

Other Points of Coverage

In addition to the above, employment practice liability insurance covers businesses from claims including breach of contract, failure to employ or promote and wrongful discipline.

How Can You Protect Yourself?

The most important way to protect yourself against claims made by either current or former employees is to make sure that your EPLI coverage is in place and doesn’t lapse (as claims can be made at any time). Businesses are at risk for a claim from the moment their first employee is interviewed, and as your business grows, the variables increase. In addition to this insurance coverage, it is always smart to distribute in-depth employee handbooks that detail the policies and procedures of your company, including job descriptions, attendance requirements, causes for disciplinary actions and expectations. Taking the initiative before you ever have the chance to receive a claim is the smartest way to protect your company.