California Business owners face many risks as they start and grow their company but many often overlook one of the biggest risks facing their business: their own employees. With the many scandals and allegations of workplace misconduct making headlines today, from Hollywood to our government, we can no longer deny how serious employee claims are to any business, whether big or small. However, business owners can obtain protection against such claims through California EPLI Insurance.
Although not a legal requirement, an EPLI insurance quote is a great investment for your business, providing crucial coverage against lawsuits related to workplace misconduct between you, as the employer, and your employees as well as other coverages that could save your company from suffering a huge financial loss from a lawsuit. Let’s discuss what this coverage is and how it works!
EPLI & Its Coverages
Employment Practices Liability Insurance (EPLI) will cover you and your business in the event that a former, current, or potential employee sues you for workplace and/or hiring misconduct allegations, including but not limited to:
-Harassment (including sexual harassment)
-Discrimination
-Breach of Contract
-Wrongful Termination
-Emotional Distress
-Defamation
-Invasion of Privacy
- Wage & Hour law violations
-Mistakes in managing employee benefits (health, dental, pension, etc.)
Although a large part of EPLI’s function and purpose is to cover claims between employer and employee it can also cover against these claims between you or an employee and a third party, such as a client or vendor, through an additional endorsement.
EPLI Exclusions
It is important to know that EPLI’s quote coverages are excluded on a standard General Liability policy and must be written as a separate, stand-alone policy. With that being said, EPLI quotes typically have their own exclusions as well, including but not limited to:
-Property Damage
-Bodily Injury
-Worker Adjustment & Retraining Notification Act (WARN)
-Contract-based claims
-Occupational Safety & Health Act (OSHA)
-Consolidated Omnibus Budget Reconciliation Act (COBRA)
Make sure to review your California EPLI quote with an insurance broker so that you understand what is included and what is not.
EPLI Claim Prevention
EPLI is important in the event of a claim or lawsuit made against you or your business by an employee because it covers your legal costs, such as defense and settlement payments, that could otherwise put your company in a financial hole if you had to pay such costs out of pocket. However, taking all the steps you can take to prevent claims will help keep your EPLI rate reasonable and even protect the name and reputation of your business. By following these steps, you can better your chances of avoiding EPLI claims:
-Step 1: Create Clear Company Policies- such policies to include are Anti-Harassment, Anti-Discrimination, and Equal Employment Opportunity policies and make sure your policies abide by local, state, and federal laws
-Step 2: Thoroughly Communicate Company policies to your Employees- distribute handbooks and/or memos of your company policies and redistribute these policies when they are changed or updated. Also consider requiring employees to sign their acknowledgement after reviewing the policies.
-Step 3: Provide Training for your Managers and Employees: train your team on your company policies to make sure everyone understands their expectations as well as what the procedure is should they experience behavior that goes against these company policies. Training can be done in many ways such as through meetings or retreats with sign-in sheets and/or written acknowledgments.
By making sure your team understands what is expected of them as well as what is expected from their relationship with you and management will ultimately benefit their working environment and your overall business.
How JVRC Can Help!
As we have discussed, EPLI coverage has been proven to be a vital form of protection for any business. Every size business faces its own risk with California EPLI claims. Large companies tend to have more employees which mean more exposure for these claims. Small companies typically tend to not have much access to legal advice and other resources and thus are more vulnerable to EPLI claims in that regard. JVRC Insurance has the vast expertise in EPLI coverage as well as access to the top carriers in California so that we can provide you with the best and fullest protection you need at an affordable rate! Contact JVRC Insurance today for an EPLI quote, we are ready and happy to help get you the protection you and your business need!