Why EPLI Is Crucial To Your Business
BY : MEAGHAN TYNDALE-WILLIAMS , CLCS , VICE PRESIDENT , JGS INSURANCE
Meaghan Tyndale-Williams began her insurance career with Liberty Mutual in Commercial Lines as a Direct Sales Property & Casualty Producer . She won numerous sales contests and awards while at Liberty Mutual including 2008 Producer of the year , Millionaires Club and Liberty Top Producer Club . In 2014 , after having her first of two children , she transitioned to JGS Insurance to be closer to home and began her current position as Vice President .
Is your company covered by Employment Practices Liability Insurance ( EPLI )? If not , you might want to consider it . Over the past twenty years , the number of employment-based lawsuits has increased as employee awareness of fair employment practices has become more widespread . Why you need EPLI insurance will become clear as you consider some of the claims that can be filed against your business .
Here are just a few examples that may provide the wake-up call you need to see how serious — and commonplace — these exposures can be :
• An employee vandalizes your bathroom by writing offensive or crude comments on a stall wall and another employee is offended .
• An employee in the lunchroom tells off-color jokes that offend other employees .
• You prohibit an employee from returning to work after a medical leave unless the employee has full clearance to perform all job duties .
• While the most common type of lawsuit results from claims of unfair employment termination , other types of lawsuits are on the rise :
• Genetic discrimination - for requesting personal or family medical history .
• Unpaid internships ( currently a hot topic on Capitol Hill ) - for recruiting workers to perform tasks normally considered part of entry-level employment positions .
• Gender discrimination - for pay inequities between men and women in the same establishment who perform equivalent tasks under similar working conditions .
According to statistics on trustedchoice . com , the average court costs and legal fees for claims that are dismissed can top out at $ 15,000 or more . Cases that are settled outof-court can set you back $ 75,000 , while those that go to trial can carry a whopping $ 300,000 price tag or more . It ’ s enough to bankrupt a company .
Harassment cases are particularly challenging . Cases often devolve into “ he said , she said ” scenarios that are virtually impossible to prove . So even if no harassment has occurred , it ’ s often easier to settle the claim than to fight these lawsuits . In a recent case I have witnessed firsthand , a litigious plaintiff was awarded a sizable $ 75,000 in damages — even though it was her sixth such claim .
Your company can follow some simple , common-sense practices to help avoid these lawsuits . The practices shown below are fairly simple and inexpensive to implement :
• Develop job descriptions for every position so employee expectations and responsibilities are clear .
• Create an employee handbook that spells out company procedures and conduct policies including specific detail about what constitutes “ harassment .”
• Offer mandatory training sessions to review policies in person and provide an opportunity for Q & A .
Of course , the best way to safeguard your business is by purchasing EPLI insurance . While workers ’ compensation and general liability insurance are mandatory , EPLI is optional , so many business owners are not even aware of its existence . Some agencies do not offer EPLI coverage or offer simple policies from a limited number of carriers . An experienced broker will not only recommend this type of coverage but also present you with a range of options . Premiums will depend on the size of your workforce , the amount of coverage , the number ( if any ) of prior allegations , and whether your company has antidiscrimination and antiharassment policies in place .
The plain truth is that there is no possible way to monitor all of your employees ’ actions at all times . You have too much to do already , and at a certain point , preparation and trust will need to kick in . To really secure your company ’ s future in this regard , talk to your JGS agent about EPLI insurance — and seriously consider this important investment . +
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