Now Is the Time to Invest in EPLI

With accusations and harassment cases capturing headlines in 2017, it is not surprising a best practice for businesses and organizations is emerging: an investment in an Employment Practices Liability Insurance (EPLI) Policy. Today, it makes sense for businesses to proactively protect themselves against the ever-growing possibility of a lawsuit.

EPLI offers businesses protection against a number of different 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

In an ideal world, workers’ legal rights would never be violated and companies would never be subject to false claims. However, we all know that is simply not the case. While you can control factors such as creating human resources and hiring policies, you can never truly guarantee the actions or words of your employees. Rather than simply hoping a claim won’t be brought against your business and that your employees follow the rules, consider taking these four steps to protect your business (HINT: one of them is investing in EPLI):

Step One: Review your companies hiring and screening processes. The minute you post a new job or start screening potential applications, you are opening yourself up for discrimination lawsuits. You will want to double check that all of your policies follow federal hiring guidelines and that you have protocols in place to ensure equal opportunity for all applicants.

Step Two: Review your existing protocols and establish clear corporate policies regarding workplace expectations. Make sure that these policies are clearly communicated to employees and easy to access. Consider requiring each new employee to sign a contract during the onboarding process that states they have seen and agree to adhere to the workplace policies. It is also prudent to have an established procedure in place that employees can follow when reporting an issue with a fellow coworker or boss.

Step Three: Document everything. From applicant screening to promotion decisions, keep a paper trail to reflect your decisions and rationales. It is also important to record any and all complaints brought to you by employees. These documents could help eliminate confusion and play a large role in disputing claims.

Step Four: Talk with your agent about adding EPLI to your insurance coverage. With the rise in claims, it is better to be ahead of the eight ball instead of behind it. An EPLI policy would reimburse you for the legal costs in court (regardless of a win or loss), judgements, and settlements. It would not, however, cover punitive damages or fines (criminal and civil).

Disclaimer: All data, information, and opinions provided on this article, newsletter, or blog is for informational and educational purposes only. While every caution has been taken to provide readers with the most accurate information and honest analysis, please use individual discretion before making any decisions based on the information in this article, newsletter, or blog. Georgetown Insurance Service, Inc. is not responsible if its readers happen to experience loss, injury, or damage resulting from its display or use. All information is provided on an as-is basis. This article, newsletter, or blog does not represent the thoughts, intentions, plans, or strategies of any specific Insurance Carrier, Georgetown Insurance Service, Inc. partner or affiliate.
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