Thursday, June 21, 2018

Small Business Owners: Are You Protected from EPL Claim? Probably NOT!

Employment practices liability claims among small business owners are on the rise!  Are you protected?  Probably not!  

The most common types of EPL claims, Wrongful Termination, Sexual Harrassment, Disablily Discrimination, Race Discrimination, Gender Discrimination, Third Party EPL claim, Age Discrimination, Whistleblowing, Retaliation, Misrepresentation, and MORE!! 

Did you know if the UPS driver harrasses your employee and you don't do anything to stop it you can be sued??

A claim against an employer for discrimination, wrongful termination, sexual harassment, retaliation and even a data breach of personal information can bring your thriving business to a grinding halt.  39% of businesses with over 25 employees have received at least one EPLI claim.  The service and retail industries are the two most likely business’s to receive a claim.  Worse yet, NY State is one of the top 4 states in the country that have experienced the most claims.  The rise in claims can be attributed to many different factors that are worthy of another discussion.  In New York state a disgruntled employee only needs to go to a website to initiate a complaint or claim against you.

As the owner of your business you are responsible for the performance and behavior management of your staff.  That includes hiring, managing and sometimes the termination of an employee.  It is a difficult but critical aspect of your job.  After a difficult but necessary performance management process in an attempt to salvage a valued employee and your investment, you have decided to terminate their employment.  You can now  take a deep breath, learn from the experience and move on.  Or can you?  

A few weeks later you receive a letter from the NY state Division of human rights.  The employee that you recently terminated is making serious allegations against you and your employment practices.  The claims against you are frivolous and false.  However you must respond to the allegations to protect your hard earned reputation.

How do you respond and defend your good name and protect your business.  Do you hire an attorney?  Do you call your insurance agent? Your response can be as easy as calling your insurance agent.   

The good news is that Employment Practice Liability Insurance (EPLI) can be surprisingly affordable.  Many of the major insurance carriers now offer EPLI coverage in their package policies.  Depending on the size of your business, EPLI can range in cost from $200 a year to several thousands of dollars.   Although many of the claims made against employers are without merit, most are settled before they reach a courtroom. The majority of the expenses associated with an EPLI claims are legal fees.  At a minimum, $5,000 -$10,000 is spent to defend and settle even the most frivolous EPLI claim.   

If you want to see if you have EPLI and the proper protection for your business, give us a call for a free policy review. 

Bill Basher, Commercial Account Executive




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