Employment practices liability insurance is essential for any business to have in order to protect against claims made by employees. This is especially true for smaller companies that may not have a defined structure of policies and training in place. Legal accusations related to EPLI have been increasing in recent years.
Even if a claim made by an employee ends up being false, there will still be costs incurred as part of the legal defense. Often this results in a settlement. There are several categories of EPLI claims examples that could occur at any business.
This is probably the most widely known of the EPLI risks. A claim can manifest from one employee making inappropriate comments or sexual advances towards another.
Hostile Work Environment
Consider a case where jokes are made and posted about a person’s weight and become pervasive. This sets the stage for an employee claiming a hostile environment.
This can involve other EPLI topics such as discrimination and retaliation. One instance would be firing an employee for raising the alarm for unethical business practices.
Discrimination against race, age or sex does not need to relate to hiring and firing only. One example is when an employee in a protected class consistently outperforms peers yet has been passed over for several promotions.