Staffing Agencies and Employment Practices Liability Issues

Your staffing agency has the same concerns as other businesses when it comes to employees claiming they received improper treatment by people within their own organization. Employment Practices Liability (EPL) insurance policies protect businesses from the financial costs incurred from these employment-related lawsuits, many of which are filed for any number of reasons, from wrongful termination to harassment to discrimination and so on.

While every EPL policy is different, typically a company with $1 million in sales and 50 employees can likely get a policy for about $7,000 per year – $10,000 if they also take out coverage protecting directors and officers in the event of liability lawsuits against them.

Protecting your agency against EPL lawsuits

In general, the more protections you put in place against EPL claims, such as internal policies and procedures that are implemented, the lower the business’s premiums will be for EPL coverage and the more likely your business will be considered a candidate for coverage.

It’s essential that you have a written employee handbook with strong anti-harassment and anti-discrimination policies, and that each employee receives a copy upon orientation. If the employee doesn’t use that procedure, your business may be able to use that as part of its defense against any suit that is filed.

Training supervisors in HR procedures and policies is equally important, and you might want to include training that involves discharge procedures for employees who are being terminated or procedures for how to handle and prevent harassment or discrimination in the workplace.

In addition, develop a code of ethics policy – this tells employees that they shouldn’t do certain things, like giving kickbacks and engaging in other ethical violations. Having an anti-retaliation provision statement says that it’s the policy of the business not to retaliate against employees over accusations of unfair treatment.

Your company is vulnerable to disgruntled employees (or candidates) that, for whatever the reason, feel they received unfair treatment. Employment practices liability coverage is your first and last line of defense.