Employment Practices Liability Insurance (EPLI) in NJ

Are you and your business protected from claims made by past and present employees?

Think you may need to take out employment practices liability insurance?  Here is a brief guide explaining what it entails and how it can benefit your business.

What is EPLI?

Employment practices liability insurance – also known as EPLI – is a type of business insurance. It is used to cover employers against claims made by employees who feel their rights have been violated.

These claims may include:

  • Wrongful termination
  • Failure to employ or promote
  • Breach of employee contract
  • Discrimination
  • Harassment
  • Mismanagement of employee benefit plans

What Does EPLI Cover?

Employment practices liability insurance can help to cover all legal costs as a result of a claim. This includes solicitor and court fees on top of any compensation that the employee would receive if they win the case. The amount paid out depends largely on the nature of the claim and any deductible you have in place.

Who Can Benefit from EPLI?

Almost all employers can benefit from taking out an EPLI policy. It is common for employers of large companies who have more staff and a greater risk of employee-related issues.

That said, employers of smaller companies can still benefit from an employment practices liability insurance. They might be more prone to employment errors since they have fewer resources and less experience. These errors can lead employee claims, stating that their rights have been violated.

How Can I Reduce the Risk of a Claim?

It’s important to take tangible steps to reduce the risk of a legal claim, even if you have already have employment practices liability insurance.

Some ways of reducing risk include:

  • Outsourcing human resources (HR) support to help with the implementation of laws.
  • Documenting decisions involving employees including hiring, firing and promoting.
  • Encouraging openness and transparency in the workplace so that employees feel that they can come to you for support.

Take tangible steps to reduce the likelihood of a claim against you, your business or your staff.

Get in touch with an insurance expert today.