There is no doubt that employment liability (EPLI) claims are a major issue for most businesses. Lawsuits from employees have risen over 300% in the last 10 years. Here is why you need to make Employment Liability part of your commercial insurance program. The average cost to settle an EPLI claim out of court is $75,000. The average employment award in 2015 was over $215,000. There are a few things employers can do to limit or reduce the likelihood of having an EPLI claim.
- Start in the application stage. Make sure your employment application does not ask anything that might be discriminatory in nature. Have a place for the applicant to sign allowing credit, personal, and criminal background checks.
- Have clearly stated job descriptions outlining job duties, skills required, and physical demands.
- Provide training for all supervisors and managers annually.
- Have a clear sexual harassment and discrimination policy.
- Require all employees to sign a statement that they have read the employee handbook and agree to follow all rules and directives.
- Develop a code of ethics policy. This tells employees that they shouldn't do certain things, like giving kickbacks and engaging in other ethical violations.
- Have a clear anti-retaliation policy stating that the business will not retaliate against employees over accusations of discrimination or harassment.
- Do annual performance reviews and outline any issues or corrective action needed to increase performance or relationship issues with other employees.
- Document all conversations with employees and keep in their employment file.
- Make sure policies are in compliance with employment laws and implemented: Title VII of the Civil Rights Act of 1964, Age Discrimination in Employment Act, and American Disabilities Act.
It may be best to use an HR specialist or attorney to review your program. If you purchase EPL Insurance you may have some of these services included within your coverage. We can design a specialized package according to your property, liability, and casualty needs. We are also proactive in identifying any factors that may increase your premiums or change your risk, and provide consulting and risk management options to protect your business. We are ready to help you better understand your risks. Please call our office today.
Enhance Your Policy With Some of These Options:
- Employment Practices Liability can cover your business if discrimination, sexual harassment or wrongful termination claims are made by present, former or future employees.
- Life Insurance for Business Owners can help you plan for business succession, survive the loss of a key employee or partner and retain/reward your top people.
- Umbrella can shield your business from potentially ruinous lawsuits with additional liability coverage.
- Transportation and Cargo to cover against goods that are damaged or lost when transported by one of your vehicles or common contract carriers.
- Spoilage for perishable goods when they spoil due to a mechanical breakdown or power outage.
- Delivery/Catering Non-Owned Auto if an employee is involved in an auto accident while driving a personal automobile on company business, such as in a delivery or catering service.
