Employment practices liability insurance or EPLI insurance protects an employer against claims made by a current, former or prospective employee. EPLI can be offered to a business as a general liability policy, or it can be added as an endorsement onto an existing business owner’s policy. The type of EPLI policy chosen is unique to each company, but most policies will help cover the legal costs necessary to defend against a lawsuit. However, they typically do not cover any fines or penalties due to negligence or criminal activity.
What does EPLI Protect a Business Against?
Any employee is able to make a claim against a business that their legal rights were violated, resulting in a lawsuit.
The most common claims that employers need protection against include:
Wrongful discipline or termination
Sexual harassment or emotional distress
Failure to employ or promote
Negligent management of employee benefits
Unfair employee evaluation
What is the Cost of EPLI for a Business?
When researching EPLI insurance policies, there are multiple factors to take into account, such as:
The type of business
The number of employees
The turnover rate of employees
The types of policies and rules already established
Any previous claims made against the business
In conjunction with stringent policies and a quality employee handbook, EPLI can help protect a business from unlawful claims from employees.