From the moment you interview your first potential employee, you are at risk of being accused of violating U.S. employment laws. In the United States, a myriad of laws protect the rights of employees, and anyone who feels he or she has been treated in a way that violates the law can bring a lawsuit against his or her employer.
Employment Practices Liability Insurance (EPLI) protects businesses against potential litigation brought by employees who are alleging discrimination, wrongful termination, harassment, or other employment-related issues.
What Does EPLI Cover?
While the details of your EPLI coverage will vary depending on your specific policy, EPLI coverage is designed to reimburse the cost of legal representation, court fees, settlements, and judgments. Most policies will cover your company whether you are found to be at-fault or not. However, many policies do not cover punitive damages or criminal fines.
Who Needs EPLI Coverage?
Most large businesses have substantial EPLI policies, as well as legal and human resources teams that ensure the business remains in compliance with all employment laws and regulations. However, small- and mid-sized businesses are at an increased risk because they do not have access to the same resources. Ultimately, any company that has employees, partners, or contractors should purchase an EPLI policy.
How Can My Company Protect Itself?
There are many important steps a business can take to lower their employment practice liability risks.
- Develop effective screening and hiring processes to avoid discrimination.
- Design job descriptions that accurately portray the responsibilities associated with each position.
- Encourage an open door policy for all managers.
- Create a handbook detailing your company’s policies, including the steps an employee should take if they have problems with their supervisor.
- Post company policies in visible places throughout the workspace.
- Thoroughly train managers on management skills and company procedures.
- Document everything, including any complaints and the actions taken for each situation.
Why Is It Important?
Even with the most conscientious business owner, every company is at risk of being accused of violating employment laws. Your BenefitSource insurance professional understands the risks associated with owning a business. We will work with you to find the right coverage for the lowest cost possible. You can call us directly at (877) 215-5431 or email us for more information.
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