The Importance of Employment Practices Liability Insurance
Employment-related lawsuits are a growing concern for employers of all sizes, including home-based businesses. Marshall & Sterling, Inc. can help you manage all your business risks, including employment practices liabilities.
What is Employment Practices Liability Insurance?
Employment practices liability (EPL) insurance is a policy used to cover your risks due to some of the most common employment-related lawsuits, including the following:
- Wrongful termination: The discharge of an employee for invalid reasons.
- Discrimination: The denial of equal treatment to employees who are members of a protected class.
- Sexual harassment: Subjecting an employee to unwelcome sexual advances, obscene or offensive remarks, or the failure to stop such behavior.
EPL works to provide the necessary resources to defend your company against a lawsuit or to pay for a claim.
To best understand how to cover your EPL risks, it’s important to know the potential sources:
- Recruitment practices
- Annual conduct reviews
- Employment applications
- Enforcing performance policies
- Employment offers
- Employee orientation process
- Improper documentation of the items listed above
Evidence of desirable employment practices and policies may be required for an EPL policy, and will certainly help defend against a suit (even for a small, home-based business with only a few employees). The underwriter may require a copy of the following policies to show that you are taking steps to reduce your risks:
- Sexual harassment
- Disability and accommodations
- Equal opportunity
- Employee discipline
- Performance evaluations
- Internet usage/employee privacy
- Leaves of Absence
- Internal job postings
- Hiring and interviewing
Avoid a Lawsuit
As costs for litigation and damage awards climb, experts predict that employment liability will only become more complex. As a result, it is critical for business owners to understand their exposures and options for managing risks.