Employment Practices Liability Insurance (EPLI)

Small business owners are often surprised that they are just as vulnerable to the same worker complaints that plague larger corporations. Unless your company has Employment Practices Liability Insurance (EPLI), you don’t have protection for these and other situations.

Businesses sometimes underestimate the importance of purchasing this coverage because these issues are less tangible. However, lawsuits are a real risk.

Your company can reduce employment practice risks by developing and implementing an employee manual containing policies that address non-discriminatory hiring practices, sexual harassment, and disciplinary procedures. Even with such measures in place, situations can arise that can lead to legal action, which is why having protection is essential.

An EPLI policy generally provides coverage for legal defense and court judgments. However, it may not cover punitive damages or civil and criminal fines. Some Business Owner Policies (BOPs) offer limited EPLI coverage. Coverage availability varies by business type and the insurance company providing the policy. Standalone EPLI policies are also available.

For more information about EPLI, please Contact Us. You may find the sites below helpful as resources for additional HR-related information:

• Employee Law Handbook
• Massachusetts Labor & Workforce Development
• Society for Human Resources Management
• LiveAbout.com: Employment Law