The Top 5 EPLI Claims to Avoid

Employment Practices Liability insurance, or EPLI, is a type of management liability insurance that provides a business with defense costs and protects against losses from employment-related claims. EPLI claims are costly to handle. The average cost of a claim comes in around $125,000, with some judgments passing the $500,000 mark.

One way companies can avoid these fees and payouts is to invest in employment practices liability insurance. While EPLI covers a wide range of claims, let’s focus on five of the most common claims that businesses experience.

Top EPLI Claims to Avoid

Typically, EPLI claims arise from allegations of various types of discrimination employees experience in their workplace. These disputes are prevalent, and the legal and regulatory outlines of our federal and state governments give employees many ways to take action against their employer in EPLI claims.

Here are the top 5 EPLI claims for businesses to avoid:

  1. Failure to Promote: A common claim that’s filed under EPLI is the failure to promote based on a protected class of people. These protected classes listed under the Americans with Disabilities Act (ADA) include deafness, blindness, epilepsy, cancer, and diabetes. If an employee feels that they are not being considered for a role or promotion because of a protected condition, they can file a claim alleging failure to promote.
  2. Discrimination: Employees are discriminated against every day for things they can’t control. The most common types of discrimination related EPLI claims include age, race, and gender.
  3. Retaliation: Some employees feel discouraged from filing a claim in fear of retaliatory actions. These claims arise when an employee alleges discrimination based on a protected status and the employee is treated adversely, such as receiving a reduction in hours, a pay cut, or a demotion.
  4. Wrongful Termination: Wrongful termination is a frequent claim under EPLI. While many employees may feel emotional upon being fired from their job, it takes particular qualifications for this claim to apply. To qualify, an employee’s contract of employment must be considered unlawfully terminated by an employer, with a breach of at least one term of the initial employment contract.
  5. Harassment: Sexual harassment claims are rising in corporate America. The Equal Employment Opportunity Commission (EEOC) says that it’s unlawful to harass someone because of their sex. Harassment includes unwelcome sexual advances, requests for sexual favors, and other verbal or physical harassment.

About Mavon Insurance

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