As we all know, COVID-19 has changed the way we live our lives—especially in the workplace. So, how has employment practices liability insurance (EPLI) changed as a result? What needs to be considered regarding EPLI and the hybrid workforce?
Let’s discuss, starting with a high-level overview of what employment practices liability insurance is.
what is EPLI?
Employment practices liability insurance, or EPLI, is insurance that “provides coverage to employers against claims made by employees.”
Policies typically extend coverage to the following:
- Wrongful Termination
- Sexual Harassment
- Wage-Related Claims
- Claims of Unequal or Unfair Pay
- Discrimination Claims (i.e. age, race, gender, sexual orientation)
- Third-Party Claims
Read on for three tips to avoid employment practice issues.
why is EPLI important?
Employment practices liability insurance is important to help protect your business from employee claims.
Picture this: Your business is sued for one of the following: sexual harrasment, discrimination, or wrongful termination. If the case winds up in court, your business may incur thousands or even hundreds of thousands of dollars in attorney fees and legal costs. For most companies, this is enough to cripple one’s business.
Here are five additional reasons to consider EPLI:
- Employee lawsuits are growing
- Settlements are getting more expensive
- All companies face risk (big or small)
- Even if your business is not at fault, you can still incur costs
- It’s unlikely that your current commercial liability policy includes EPLI coverage
the importance of EPLI in a hybrid workforce
During the pandemic, many employers faced EPLI claims due to employee filing for:
- Wrongful termination
- Discrimination over vaccine mandates
- A business’s refusal to accommodate a disability
- Harassment (i.e. a masked employee may file a harassment claim if their coworkers do not mask or vice versa)
Now, however, as employees return to the office, employers may face EPLI risks when designing hybrid workplace policies.
During the 2022 RISKWORLD™ conference, a session titled “Returning to Work? Check the Health of Your EPLI Coverage” took the floor. They noted that businesses moving from remote to hybrid models may open themselves up to EPLI risk if not done properly.
Here are some hypothetical situations that were discussed:
- “If a remote employee is passed over for a promotion in favor of someone who works in-person at an office, they may allege unfair treatment, resulting in a wrongful deprivation of opportunity claim.
- If return to office policies are implemented unevenly, employers could face discrimination claims.
- COVID-19 testing could result in privacy claims if an employee feels any medical data wasshared intentionally or inadvertently with coworkers.
- An employee could file a harassment claim if they feel their coworker is dressing or acting inappropriately over Zoom.”
Read on to learn how EPLI can protect your business.