What Is Employment Practices Liability Insurance?

Employment practices liability coverage, or EPL insurance, helps to protect your business against claims made by your employees. Your EPLI coverage protects you against claims of employment-related issues, like:

Discrimination
Wrongful termination
Harassment

What Types of Claims Does Employee Liability Insurance Cover?

Your employer practices liability insurance can help you to deal with several different types of claims. Employee liability coverage generally covers claims of:

Age discrimination
Wrongful disciplines
Harassment and sexual harassment
Wrongful failure to promote
Wage and overtime calculation violations
Job classification violations
Violations of employment laws, like the Equal Employment Opportunity Act of 1972, and the Americans with Disabilities Act of 1990
And more

Most employee practices liability coverage protects your business against claims brought by employees, but some policies still leave you vulnerable to harassment or discrimination claims brought by your customers or vendors. Be sure to carefully read the terms of your EPLI coverage to make sure that your business is fully protected against the potential risks you could face.

How Can You Protect Your Business Against Employee Lawsuits?

Investing in a quality employee liability insurance policy is an excellent way to protect your business from potential lawsuits. You can also take several other steps to reduce your business’ risk of a lawsuit.

Familiarize yourself with employment laws and ensure that your hiring process adheres to all employment and hiring requirements.
Create job descriptions for each position and ensure that the descriptions outline the position’s responsibilities and performance expectations.
Develop employee policies and procedures and enclose all of these documents within an employee handbook.
Ensure that supervisory and hiring staff are up-to-date on all of your business’ policies and provide them with regular training on employee hiring and management best practices.
Carefully screen job candidates before calling them in for an interview, perform a background check, and contact multiple references to verify each candidate is a good fit for your business before extending an employment offer.
Have your business’ lawyers review all of your hiring documents, including your employee handbook for potential violations, and discuss your hiring process with your lawyers to identify any changes that you might need to make. Your lawyers should also review your job application and interview questions to make sure that you aren’t collecting any information about topics like age.

What Does Employer’s Practices Liability Insurance Cost?

Employment liability insurance costs will depend on several factors, including how many employees your business has and your employee turnover rate. An insurance provider may also ask about any employee policies you have, like an employee handbook, and whether employees have previously filed any suits against your business.

Since so many factors can impact your employee liability insurance costs, it’s best to get a personalized business insurance quote for an accurate idea of your policy costs. You can get a free business insurance quote today and compare your policy options.

Paige Cerulli Paige Cerulli is a freelance content writer and journalist who specializes in personal finance topics. She graduated from Westfield State University and brings more than a decade of professional writing experience to the ConsumerCoverage team. Paige’s work has appeared in outlets including USA Today, Business Insider, and more.