Introduction to EPLI
If you are a business owner with employees, you should seriously consider purchasing Employment Practices Liability Insurance (EPLI), especially in today’s social climate. With concerns mounting over racial and disability discrimination, as well as gender inequality and sexual harassment, EPLI makes sense now more than ever.
Over the last few years, the number of lawsuits brought by employees against their employers has grown. While this often involves large corporations, no company is immune from a lawsuit. In light of this need for EPLI, some insurance companies have offered this additional coverage as an endorsement to a Business Owner’s Policy, while other insurance companies have offered stand-alone EPLI coverage.
Are you at risk?
With more news being distributed online, coupled with increased intolerance for public harassment, this coverage is very valuable. At this time we are finding a heightened risk for employers, not only due to the current social climate but due to COVID as well. When companies experience layoffs, less hiring, fewer promotions, and reductions in salary we begin to see more EPLI claims.
The effects of COVID
During the first wave of COVID, employers considered whether or not to allow employees to come into the office and were downsizing their teams. Furloughs and layoffs resulted in an increase in wrongful termination lawsuits. With the COVID vaccine and possible vaccine mandates, employers are now heading into the second wave of COVID management, and we are not yet sure what will arise as the vaccine program unfolds. Can an employer require an employee to get the vaccine? What if they refuse?
These are new areas employers are going to have to navigate in this new post-COVID climate. The current guidelines from the Equal Employment Opportunity Commission state that employers can mandate that employees get vaccinated, however, that is not the final word as there are other federal laws that could result in a different conclusion. This is still an evolving situation that may change over the next few months.
Is EPLI coverage right for you?
EPLI insurance will cover you against many types of employee lawsuits, including discrimination, sexual harassment, wrongful termination, mismanagement of benefits, failure to promote, breach of contract, and more. What will EPLI cost you as a business owner? That will depend on what type of business you have, how many employees you have, and other factors, including whether you have had employee lawsuits before. The policy will cover legal costs, whether you win or lose the suit. It will also cover settlements and judgments. Peace of mind is priceless; if you’ve been contemplating this valuable insurance coverage, we highly recommend getting a quote.
Protect yourself and your business
As an employer, what can you do to limit employee lawsuits? First, ask yourself, can you accommodate your employee? If not, ask yourself why not? Then begin increased training. Train your managers and employees on how to handle accommodation and disability requests. Create new and effective hiring practices that avoid discrimination when hiring. Ensure that all your employees are aware of corporate policies with an employee handbook and posting them where they are visible. Encourage employees to report any sexual harassment or discrimination and make sure every complaint is documented. Finally, no matter how well you prepare and train employees and management, you still run the risk of an employee lawsuit.
It is a wise investment to protect yourself and your business with Employment Practices Liability Insurance. Reach out to us at Gordon Companies with any questions or concerns about EPLI.