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Employment practices liability insurance, known as EPL insurance or EPLI, provides coverage to employers against claims made by employees alleging discrimination (based on sex, race, age or disability, for example), wrongful termination, harassment and other employment-related issues, such as failure to promote.
Large corporations typically have substantial employment practices insurance coverage in place and are prepared to deal with just about any employment lawsuit. However, small or new businesses are often the most vulnerable to employment claims. That’s because they usually lack a legal department or employee handbook detailing the policies and procedures that guide hiring, disciplining or terminating employees.
Employment practices liability insurance is essential protection for your business from claims brought by past, current or even prospective employees. Even with the best intentions and most comprehensive non-discrimination procedures, you or a well-meaning employee can make a mistake or simply be the target of a disgruntled person.