Employment Practices Liability Insurance: Don’t Wait Until It’s Too Late

May 15, 2017

Employment claims. Two words that can place the toughest financial strain on your business, especially if it’s small to mid-sized. From discrimination to retaliation, hostile work environments and sexual harassment — claims like these can be crippling. Often, a business ends up paying its own legal fees and funding settlements which can, in some instances, bankrupt the company if the amount is significant.

The good news? You can avoid this kind of hardship because YES, there is insurance for employment claims that can cover legal defense and substantive liability — whether it be for a settlement or a judgement. So, here’s what you need to know about insurance for employment claims:

How can I insure my business from employment claims?

While there are many different types of insurance that can indirectly or partially protect a business from employment claims, the surest way to protect yours is with Employment Practices Liability Insurance (EPLI). EPLI deals directly with employment claims — it safeguards employers from claims made by employees alleging some form of discrimination (whether it be sex, race, age or disability), wrongful termination, failure to promote and other employment-related claims. And this kind of protection is invaluable.

What are the benefits of EPLI?

For a business with an EPLI policy in place, settlements can be worked out by an employer’s attorney and the plaintiff’s attorney, which involve little to no cost or hardship to the defendant business. An uninsured business, however, is forced to approach an employment case with far less freedom. The uninsured business will have to fund the defense of the claim itself — this strain and distraction seen within the business’ management is palpable and counterproductive, both to the defense of the case and the management of the business itself.

Maybe you believe your business will be just fine — the relationship you have with your employees is almost flawless, and nothing can get in the way of that. While this may be true, nothing is ever certain. Even if you don’t see an issue on the horizon at work, you want to be prepared if one should arise. Once a claim has been made, it’s too late to buy coverage for that claim.

Where do I start?

For those businesses that either do not have EPLI, or are unsure whether it’s in place, feel free to give Post Polak a call. Initial consultations are free of charge. And if you so choose, we’d be happy to provide customized employment law advice for your business after that. Our attorneys will look at your employment practices from every angle, and with the benefit of many years practice — from examining your business and business activities to determining potential sources of legal exposure — we’ve seen decades of employment law cases and are more than happy to help determine the nature and extent of the insurance you need.

Investigating your coverage now will stop you from being that exposed business. You know, the one that finds out after-the-fact that yes, there is insurance for this. So, what are you waiting for? Examine your coverage now. Ensure your protection by calling us at (973) 228-9900 and asking for one of our employment law lawyers.