Respect Employment Practices Liability

These are tumultuous times for small business owners.  The economy has not only made running a business difficult, but managing the business as well.  Small business owners can no longer look at their employees as family members.  When the effective unemployment rate is at 15%, employees get desperate.  Gone are the days of losing your job and quickly jumping into a new one. So when a business decides to let an employee go every “T” must be crossed and every “i” must be dotted.  More and more former employees are looking for ways to cash in on being fired. 

According to an article in the NY Times by Paul Sullivan, a report released in March from the Equal Employment Opportunity Commission said claims were up 15 percent last year, to 95,402, the highest number in the agency’s 44-year history.  Mr. Sullivan hypothesizes that with the unemployment rate continuing to increase this trend of discrimination and wrongful termination claims will likely climb again this year.

So how do you protect your business against such claims?  There is an insurance product, (outlined below from this III.org article), called Employment Practices Liability (EPLI).  EPLI provides protection against many kinds of employee lawsuits, including claims of:

• 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 is overlooked far too often by small business owners for various reasons (employees are considered family, don’t want the expense, assume coverage included in Business Owner Policy, etc.).  Considering the amount of coverage an EPLI policy provides a business the cost of such a policy is very inexpensive.

If you are a business owner or decision maker in your business, I highly recommend contacting your insurance professional about EPLI.  The headaches and legal expense associated with a wrongful termination or discrimination case are horrible.  EPLI provides an easy answer to those concerns.

“If you’d like to talk about your Insurance Risk, contact me today. We can talk about your exposure, and begin our relationship!”  

Thank you,  

Ryan H.  

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