About Employment Practice Liability

Employment Practice Liability | Ideal Insurance Agency

Small business employers are often so busy they don’t stop to realize that there are laws that must be followed in the workplace. Employment lawsuits often filed are because of alleged wrongful hiring practices, discrepancies in disciplinary actions, sexual harassment {one employee in the State of Arizona for both quid pro quo and a hostile work environment} American with Disability Act issues, {15 or more employees} Title VII Act issues {15 or more employees that prohibits employers from discriminating on the basis of race, color, national origin, and religion}, Age Discrimination Employment Act {20 employees or more}, Family Medical Leave Act {50 or more employees} and wrongful discharge. The average cost to an employer to defend an employment practice lawsuit valid or not is $60,000 and the average settlement is in excess of $230,000. A heavy blow to the finances of any business.

Many business owners are under the wrong assumption that if they are sued by an employee for an employment issue their general liability policy will respond. A general liability policy covers bodily injury and property damage, but not employment issues as described above.

Employment Practice Liability Insurance (hereinafter “EPLI”) is one of the most undersold insurance products. As stated, any business who has one or more employees has an exposure to an employment lawsuit . An example many be an allegation of sexual harassment through an employee who brings a complaint to the Equal Employment Opportunity Commission (hereinafter “EEOC”) or files a lawsuit outside the EEOC. If an employee files a complaint with the EEOC and is granted a “right to sue letter” it will cost the employee nothing to file a suit.
The average cost to an employer to defend an employment practice lawsuit valid or not is $60,000 and the average settlement is in excess of $230,000. A heavy blow to the finances of any business. Who needs this coverage any employer who has one or more employees. To further discuss in greater detail on EPLI policy please give us a call at 623-933-8263.