Reducing Risk Exposure to Employment Practices Liability Suits

Employers can invest in employment practices liability insurance (EPLI) to ensure they have adequate coverage in the event of a claim relating to discrimination, wrongful termination, failure to promote, harassment, and more. Most large businesses have adequate EPLI coverage, but small businesses and startups may be vulnerable to discrimination claims. Thankfully, there are several ways businesses can reduce their employment practices liability risk.

Top 5 Tips to Address Employment Practices Liability Risk

  1. When posting job opportunities, include clear descriptions defining duties and expectations. Be sure applications do not include any potential discrimination triggers such as asking what year the applicant graduated from college. This can result in age-related discrimination lawsuits.
  2. Conduct background checks and screen applicants to weed out unsuitable candidates before interviewing them in person. EPLI risk starts from the moment an employer interviews a job candidate. If a business opts not to hire someone they interviewed, that individual can claim discrimination.
  3. Write an employee handbook providing clear policies and procedures for attendance, discipline, and termination. The handbook should also include an equal employment opportunity statement.
  4. Perform in depth performance evaluations for all employees and keep detailed records of the results. This can provide protection if an employee alleges wrongful termination.
  5. Discuss your risk and EPLI coverage needs with an insurance agent.

A number of factors affect how much EPLI coverage a business needs: how many individuals the business employs, any previous discrimination lawsuits, employee turnover rates, and more. The Reilly Company can help your business determine your risk level and how much EPLI coverage you need. To learn more, contact us today.