Attention Business Owners! Are you covered by the right Employment Practices Liability Insurance?

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The process of hiring and terminating employees can be a very stressful time in decision making as a boss.  There are a variety of assessment strategies to use when choosing the right fit for your business roles needed.  After evaluation an employee’s performance, you make the decision to let them go based on their poor performance.  You’ve documented prior incidents and have given verbal warnings, but they still failed to heed them.  An argument ensues and the disgruntled employee storms off.  You begin the hiring process again for a replacement.  A couple of months go by and business is booming.

 Your new staff member is working above and beyond for the success of your establishment. Things are going great until something happens that quickly turns into a business owner’s worst nightmare.  You are served with a lawsuit. The ex employee is claiming discrimination. Are you covered by the right Employment Practices Liability Insurance?

If you are covered by Employment Practices Liability Insurance (EPLI), it provides protection against a variety of employee lawsuits, including claims of:

• Wrongful termination
• Discrimination
• Deprivation of career opportunities
• Negligent evaluation
• Sexual harassment
• Mismanagement of employee benefit plans
• Breach of employment contract
• Wrongful discipline
• Failure to employ or promote
• Wrongful infliction of emotional distress

EPLI Coverage provides defense costs, judgment and settlements, whether your company wins or loses the lawsuit. The cost of this coverage will depend on the type of business you have, number of employees and various risk factors such as prior lawsuits for poor employment practices.
Pre Employment screening with criminal background checks, credit checks, assessment tests and interviews with previous employers and personal references will help you determine if the candidate is the right fit.  Hiring an employee with a criminal background could exclude you from insurance coverage if they commit employee theft.

 The best way to protect you and your business against lawsuits by employees is to make sure that you provide hiring procedures that are compliant with legal non-discrimination requirements and that you demonstrate equal opportunity on the basis of gender, age, sexual orientation and religious affiliation. Be sure to include an anti- discrimination and sexual harassment policy in your employee handbook as well.  All employees should sign off on these policies.

To learn more about Employment Practices Liability Insurance, contact Linda Krisko Insurance & Financial. Commercial agents with over 30 combined years of experience are on hand to answer any of your questions and options to help protect your business.

 You can visit us at 1422 W. Hamilton Street in Allentown, PA or call us at 610.433.5000


*image borrowed from www.insurancejournal.com