Employment Practices Liability Insurance protects a business from employment-related claims. Small businesses are particularly vulnerable to claims because they don’t have the resources to tackle every potential problem.
What Can Small Businesses Do?
Distributing an employee handbook to each worker during the hiring process is an important step. Detailed policies and procedures guide the company when hiring, disciplining, and terminating employees. The written procedures also ensure that employees are aware of expectations.
Even the most well-written handbook, however, can’t cover every situation, so investing in EPLI insurance is critical for the business owner.
What Does EPLI Insurance Cover?
An EPLI policy covers the damages incurred and the costs related to lawsuits against the business. Claims examples include:
- Failure to hire – If a candidate claims they have been overlooked due to a disability, they can take legal action.
- Discrimination – A business can be sued if an employee feels they have been treated unfairly because of age, race, or gender.
- Wrongful termination – If an employee’s contract is terminated unlawfully, that person may seek litigation.
- Sexual harassment claims – An employee that is sexually harassed can sue the company. This includes unwelcome advances or requests that are either verbal or physical in nature.
Employment claims can be devastating to a business owner, but EPLI insurance coverage will protect their company against litigation.