Employment Practices Liability (EPL): Should I consider it?

Workplace discrimination claims reached a record high in 2009 with claim payouts over $375 million. Please keep in mind that the $375 million does not include the defense costs associated with these claims either. A more staggering fact is that roughly only 1% of all businesses carry EPL. The fragile economy and more worker friendly laws have added to the increased number of employment practice liability claims.

Businesses should not be so exposed, but many small businesses don’t have internal resources, such as in-house counsel and human resources professionals, to establish risk-management policies and procedures, or rigorously document poor employee job performance. Even if you consider a claim to be fraudulent the cost to defend can quickly cause damage to a company's financial stability. Therefore, EPL coverage should be strongly considered by all businesses - small or large.

Common EPL claims are:

1. Workplace Discrimination
2. Sexual Harassment
3. Age Discrimination
4. Wrongful Termination
5. Failure to Hire
6. Failure to Promote

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