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Three Times You Will Need EPLI

Three Times You Will Need EPLI

Employment Practices Liability Insurance (EPLI) is one of those lines of coverage that many businesses don’t want to purchase. It may seem like an unnecessary expense and is often overlooked when a company is building an insurance portfolio. There are plenty of instances when EPLI can come in handy.  Here are the three big ones. (1) When You Are Hiring Employees Hiring new or replacement employees is never easy. Once you post the help wanted ad you have to deal with an onslaught of resumes, phone calls, and in-person inquiries. This is time-consuming and frustrating. After you narrow down the list of applicants there are phone and/or in-person interviews, and then the hope that your selected applicant is everything they seem to be and more. From the perspective of a potential employee, things are just as frustrating. They’re sending out multiple resumes and going on multiple interviews. The one with your company goes well, but then they don’t get hired. Why? Some potential employees may believe that they should have been hired and weren’t because of something other than they weren’t right for the job. A job applicant may decide that he or she wasn’t hired due to skin color, gender, sexual orientation, country of origin, pregnancy, disability, or another discriminatory reason. While some of these claims are easy to dismiss, the applicant may choose to hire an attorney and file suit. Fighting a discrimination claim can be time-consuming and costly for your business, even resulting in negative press.  The answer? Employment practices liability insurance.  (2) During The Course of Employment The biggest expense for an employer is, of...

Employment Practices Liability Insurance

Employment Practices Liability Insurance Frequently Asked Questions Employees are typically the single largest expense to a business year after year. Salary, benefits, and training all contribute to the cost per employee. Employees and potential employees can cost your business in other ways. Harassment lawsuits, racial or sexual discrimination and other employment-related causes of action can cost your business money in legal fees and claims payouts. The best way to protect your business is to purchase Employment Practices Liability Insurance (EPLI). Here are some frequently asked questions about this coverage: Isn’t EPLI included in my Commercial General Liability (CGL) insurance policy? This coverage is NOT usually included in your CGL policy. It would need to be added as part of a package policy or purchased as a stand-alone coverage. If you are unsure, check your policy and then talk to your broker. What does EPLI cover? EPLI policies are tailored to fit your business and may include coverage for harassment, discrimination, wrongful termination, breach of contract, failure to employ, failure to promote, violation of civil rights laws and more. See our document titled “SUMMARY OF EPLI (EMPLOYMENT PRACTICES LIABILITY INS.) RISKS” for a more comprehensive list. Does my business need EPLI? Any company that has employees or plans to hire employees needs EPLI coverage. Even if you only employ family members, or you haven’t hired your first employee yet, you should have this coverage in place. Allegations of misconduct or discrimination can come from anyone at any time, even during the interview or hiring process. EPLI claims and lawsuits can be expensive and time-consuming. Even with little or no indemnity...
Can You Get Sexual Harassment Insurance?

Can You Get Sexual Harassment Insurance?

It is one of the hottest issues of this news cycle: inappropriate sexual behavior in the workplace. Sports stars, journalists, pastors, actors, directors, producers, government officials and more are being accused on a daily basis of sexual harassment and/or sexual misconduct. The question is, can you get sexual harassment insurance to protect your business from these claims? The answer is yes. It’s Called EPLI Employment Practices Liability Insurance (EPLI) is the type of coverage that protects employers who may find themselves in the midst of sexual harassment allegations, among other things. This coverage is typically purchased as either a stand-alone policy or included with general liability or directors & officers liability packages. EPLI policies can be written to cover a number of potential problem areas including sexual harassment, sexual discrimination, mental anguish, wrongful termination, negligence, whistleblower retaliation and more. It’s Pre-Paid Legal When you read about workplace sexual harassment claims, the legal settlements usually aren’t that large, with many settlements under $100,000. In fact, the Equal Employment Opportunity Commission reports that in Fiscal Year 2016 there were 9,566 claims settled without litigation, resulting in $40,700,000 in claims payments. That’s an average claim payment of just $4,254.65. What that figure doesn’t take into account are those claims that were litigated. Legal fees can dramatically increase the cost of a sexual harassment claim, as well as increase the amount of time involved in fighting a suit. Litigated claims can often also increase the amount of settlement beyond $100,000, in addition to those legal fees. EPLI insurers offer legal representation to their policyholders, in addition to indemnity payouts for settlements or judgments....
Do you need EPLI?

Do you need EPLI?

Being a business owner and an employer comes with a lot of responsibility. From payroll taxes to health insurance, hiring costs and more, finding and keeping good employees can be difficult. Sometimes mistakes are made: you hire the wrong person, the economy takes a dip and you have to lay off employees, a job applicant feels you made the wrong decision. Even if you keep meticulous records and follow all of the rules, a disgruntled current, former or would-be employee can still sue you. That’s where Employment Practices Liability Insurance (EPLI) comes in. EPLI coverage protects your business from claims made by workers, buffering your business from the costs associated with litigating these matters. Fired/Laid Off Workers No matter the circumstances, firing or layoffs can result in lawsuits brought by former employees. A Hayes Brokers client who did not purchase EPLI coverage found themselves in litigation with an employee who was fired for drinking on the job. The fired employee filed suit against the employer alleging racial discrimination, demanding $50,000 in damages. Legal fees are thus far in excess of $20,000 and will likely exceed the $50,000 plaintiff demand before it is all said and done. It Only Takes One Employee Even small businesses can feel the pain of employment practices liability claims. Even if there is only one employee in your company, that one employee can file suit and possibly bankrupt your business. A photographer with one long-time employee, an administrative assistant, decided to retire after nearly 30 years in business. He gave the employee plenty of time  to find other employment, but just after announcing his retirement...
Beware the Pitfalls of Social Media

Beware the Pitfalls of Social Media

It used to be that if you wanted to build a small business into a big business you had to spend a lot of money. Mail campaigns, print advertising, radio and television spots had to be purchased in a wide range of markets to get the word out about your product or service. Times have changed, and the Internet is king. Any small business can grow significantly by using social media, and a lot of it is free! Twitter, Facebook, Youtube and many other sites allow anyone to talk about anything, anywhere, at any time, and it won’t cost you a nickel. Or will it? In this society of free speech and one-on-one customer engagement through free or low-cost social media, the pitfalls are many and they can cost you if you aren’t careful.  Saying the wrong thing can result in everything from customer backlash to corporate lawsuit. In the digital age even the things you delete can live on forever through website caching and screen shots.  Read on to find out how to protect your business.   What Does Your Liability Insurance Policy Cover? Most businesses purchase Commercial General Liability Insurance to cover things like slips and falls or products liability, and those policies usually include coverage for personal and advertising injury. Personal or advertising injury may include using copyrighted photos without proper licensing or permission, slandering a customer or a competitor, or advertising the wrong price or details on an item. So what happens if you make a mistake in an online Facebook status, or offend someone on Twitter? Generally the advertising injury portion of your policy...