Whether you own a huge business or have just started, getting into a possible employment related lawsuit can be scary. No business owner wants it. Unfortunately, these lawsuits have become quite common. An employer is at constant risk of being sued by current or former employees for violation of laws designed to protect workers from exploitation. Even though, no one is safe from this risk, the truth is that as your company grows, the risk of having a lawsuit filed against you increases too.

The good news is that there is a way you can save your business from risks associated with lawsuits; simply by getting an Employment Practices Liability Insurance or EPLI. This insurance is specially designed to cover claims of workplace discrimination, based on age, sex, race, and any wrongful termination, harassment, and failure to promotion.

EPLI is comprehensive and covers many employee related areas. In this short guide we will explore what it is, its benefits and whether or not your business needs it. So, read on to learn more.

What Is Employment Practices Liability Insurance?

EPLI is a type of insurance that companies can buy to protect themselves from potential employment lawsuits. As discussed above, it covers wrongful termination, discrimination, and sexual harassment; claims that are usually not covered by general liability insurance policies. This insurance applies to directors, officers, employees and sometimes even extends to third party liabilities.

EPLI has become more common in this litigious age, however this does not mean that it is meant to replace secure employment practices of a company. In fact, most insurance companies will not even insure a business unless it has basic employment practices.

EPLI protects companies against many types of lawsuits, some of them include:

  • Discrimination of any sort
  • Harassment
  • Wrongful termination
  • Breach of contract from the company’s side
  • Failure to employ or promote
  • Infliction of emotional distress
  • Mismanagement of employee benefits
  • Slander
  • Invasion of privacy
  • Punitive damages

Benefits of EPLI

Everyday employers make decisions that impact the lives of their employees, be it hiring, firing, promoting, giving benefits or compensations or creating a safe environment for them to work in. These decisions put employers at a risk of complaints and even lawsuits. EPLI ensures that an organization is protected from these risks at all times. Some of the many benefits of this insurance include:

  • Coverage for alleged acts
  • Full coverage of defense costs
  • Timely responses to lawsuits
  • Access to the best legal help
  • Favorable risk management strategies
  • Additional protection to officers and directors

So, Who Should Get EPLI?

Human Resources related lawsuits are often settled with huge sums of money. This is why if you have employees working under you, no matter how many, you should definitely get the Employment Practices Liability Insurance. This insurance will cover the alleged cost if you get into a lawsuit and you wouldn’t have to pay for it from your own pocket.

EPLI is specially recommended to small businesses, as they do not have the extra funds and resources to fight a big lawsuit. Getting EPLI will ensure that you receive legal help and the best management strategies to win your case. And even if you don’t, the filer of the case will be reimbursed.

Wrapping It Up

And there you have it; everything you need to know about Employment Practices Liability Insurance. Employment Practices lawsuits can be very damaging; they can drain all your savings. The best way to save yourself from such risks is to get EPLI.

At Stuttgart Insurance Solutions, insurance experts are eager to help you manage all your business risks, including Employment Practice liabilities. Get in touch with them today to learn more about how they can help you in setting up the right insurance plan for your business.

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