Why Do I Need Employment Practice Liability Insurance?
As a business owner, you strive to hire qualified employees to work for
you. Unfortunately, as you are well aware, not every hiring decision goes
as planned. Even if an employee is terminated for legitimate reasons— such
as poor attendance or unsatisfactory work habits—every termination opens
the door for potential lawsuits. Read on to learn from one business owner’s
experience and find out how employment practice liability insurance (EPLI)
can help protect you and your organization from costly, frivolous lawsuits.
When Mary, a Virginia business owner, received a complaint that her sales
manager made crude, disparaging remarks to a female employee during a trade
show, Mary took the claim seriously and conducted an investigation. During
the course of her investigation, Mary spoke with another employee who
witnessed the incident firsthand. According to this employee, the sales
manager’s actions were offensive and harassing. Ultimately, after much
deliberation, Mary fired the sales manager for his behavior.
Weeks later, the employee that witnessed the incident sued Mary for
$500,000, claiming that after the incident, Mary had passed her up for
promotion and assigned her poor sales territories, all because she came
forward with the details of what happened at the trade show.
Although the lawsuit was groundless, Mary racked up hefty legal bills
defending herself against the allegation.
Lawsuits like the one Mary faced can come out of left field and are much
more common than you’d think. In fact, three out of five employers will be
sued by a prospective, current or former employee while they are in
business. EPLI can help mitigate these risks by providing the necessary
resources to defend your company against a lawsuit or pay a claim.
As costs for litigation and damage awards climb, experts predict that
employment liability will only become more complex. Call Robertson Insurance & Risk Management today to learn more about EPLI and discuss
your employment-related risks.
Employment Practices Liability (EPL) Insurance
When it comes to protecting your organization against potential lawsuits brought about by employees, EPL insurance is often the
best source of coverage. Specifically, EPL insurance can provide protection
for employment-related misconduct claims.
Most policies cover claims for sexual harassment, wrongful termination,
discrimination and retaliation. In some cases, policies can provide
coverage for additional employment-related claims, including defamation.
EPL insurance can also protect against claims made by non-employees, like
vendors or customers.
It should be noted that EPL insurance often excludes claims that allege
bodily injury. Therefore, in the event that a claimant alleges both verbal
and physical harassment, an EPL policy may only provide partial coverage.
Your Trusted Adviors
Robertson Insurance and Risk Management has met the insurance needs of businesses and individuals for over 30 years. We take pride in what we do and work hard to look out for the best interests of our clients. We represent a carefully selected group of financially sound, reputable insurance companies that we’ve built strong, partnering relationships with over the years. We can develop insurance programs that best fits your needs with an insurance company who understands you and your business. Contact us today 717-625-3770