EMPLOYMENT PRACTICES LIABILITY INSURANCE

What is Employment Practices Liability Insurance?

Employment Practices Liability Insurance (EPLI) provides protection to an employer against claims made by past, present or potential employees relating to several kinds of employee related law suits, including:

• Sexual harassment
• Discrimination
• Wrongful termination
• Breach of employment contract
• Negligent evaluation
• Failure to employ or promote
• Wrongful discipline
• Deprivation of career opportunity
• Wrongful infliction of emotional distress
• Mismanagement of employee benefit plans

EPLI pays for both the legal defense costs and indemnity payments associated with employee lawsuits.

Why do I need Employment Practices Liability Insurance?

Employers are subject to more federal, state and local employment laws that ever before.  More laws mean a greater risk for potential lawsuits from past, present or prospective employees. Some estimates show that 3 out of 5 businesses will be sued by an employee. Here is a short list of federal employment discrimination statutes enacted or enhanced in recent years:

• Title VII of the Civil rights Act of 1964
• The Family and Medical Leave Act (FMLA)
• The Americans with Disabilities Act (ADA)
• The Equal Pay Act (EPA)
• The Civil Rights Act of 1991
• The Age Discrimination in Employment Act (ADEA)

The bottom line is employers today are facing significant liability when making decisions regarding their personnel. Remember, even if a lawsuit is groundless, the costs associated with the defense of these actions can be very expensive.

How do you protect against Employment Practices Lawsuits?

• Develop effective hiring and screening procedures to avoid discrimination
• Maintain Employee handbooks and post employment policies throughout the workplace
• Provide employees with clear procedures to follow if they are being sexually harassed or are facing discrimination
• Document all actions related to discrimination or harassment
• Identify work place issues that create Employment Practices related lawsuits
• Purchase Employment Practices Liability Insurance

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