Employment practices liability insurance or EPLI is coverage against any claim made by employees to his/her employer stating discrimination based on race, gender, age or disability; for example any type of harassment, unjustified or wrongly justified termination, the conflict between employees and other office premises related issues. Large corporations have significant employment practices insurance coverage or have personal attorneys to deal with any kind of employment lawsuit.
But, for small business or startups, it becomes necessary to buy EPLI as they are not well-establish to form a legal department to manage any lawsuit. The policy will pay all the liabilities against any claim by employees, fees to an attorney, and others. On the other hand, the policy will not be liable to pay coverage for any disciplinary damage or criminal fines.
Here are some of the reasons every small business should buy EPLI.
Sexual harassment
Any misbehaving activity is being promoted in the office premises such as serious offense like sexual harassment can be the reason of any lawsuit or claims against the employer. That’s where an EPLI will help to accommodate such situation. Having EPLI coverage is not only financial help but also keeps you stress-free and enables you to pursue your priorities.
Unjustified termination
Any of your employees or former employees may not be happy with your decision to terminate him/her; this can lead them to file a lawsuit against you. Having an employment practice liabilities not only pays actual employer liability amount but also pay claims against unjustified termination lawsuits.
Discrimination in the premise
Discrimination in the office premise can be based on several factors such as sex, age, race or disability. No matter, you being an ideal boss to your employees. Still, it will become hard for you to know how your employees treat one another. This can lead to any employee file a lawsuit against the company. Having an EPLI will compensate all the legal cost of a lawsuit for such type of issue.
Failure to promote or employ
Whether your old employee is still digging with his/her present position and wanting a promotion or at the time interview you promised but not provided employment (maybe because of some reason), this kind of behavior towards employees can prompt them to file a lawsuit against you. In this situation, EPLI will be your best companion to safeguard you financially.
Mishandling employee benefit plans
If there is any mishandling or carelessness against your any of the employee’s benefits regarding financial upfronts, this can disturb your employee. As a result, he/she can act against you by filing a legal lawsuit on the particular matter. Having an EPLI will keep your financial help to deal with such unfortunate situation.
To Sum It Up
There are different business insurance to accommodate any damage or issue regarding any mishap in your business, employment practice liability insurance is one of the important insurance that every business needs to buy to have a financial backup against any employee-related issue.