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Small Businesses and Employment Practices Liability Insurance

If you are a small business owner, chances are you will face an employment claim. Having even one employee puts you at risk for being sued. If an employee takes action against you, legal fees to defend yourself can be huge, even if you are not at fault. Employment Practices Liability Insurance helps cover these costs.

Over 90,000 employment practices liability charges were filed with the EEOC in 2018, and over $500,000,000. was paid out in settlements that same year. Most of these claims settled for between $27,000 and $50,000, amounts that will significantly impact your bottom line and could even spell disaster for your business. Here are some examples:

A small gift and flower shop owner was sued for pregnancy discrimination when the claimant alleged that the employer repeatedly treated her differently because of her gender and condition. The claimant provided several fellow employees who attested to the treatment by the employer. Total settlement plus legal fees $42,000.

A small retail store owner was sued for sexual harassment when the claimant alleged that the son of the owner, also an employee, made inappropriate comments and gestures and solicited the claimant for sexual favors. Total settlement plus legal fees $80,000.

A small restaurant owner let a middle-aged employee go due to performance issues. The employee sues alleging age discrimination because he was over the age of forty and many other employees still employed were younger than forty. Total settlement plus legal fees $20,000.

Employment claims are a serious risk and more than half are directed at small businesses. Protect yourself and your business with Employment Practices Liability Insurance. EPLI can provide protection against lawsuits stemming from harassment, including sexual harassment, discrimination, wrongful termination, violation of the Family Medical Leave Act, defamation, and retaliation.

What do you get with an Employment Practices Liability Insurance endorsement? Well, that varies from insurer to insurer, but may include access to online loss prevention websites, specialized claims services, or even access to experienced legal representation through legal advice hotlines.

Do not risk facing an employment claim on your own. Ask your agent about adding an EPLI endorsement to your business policy that is custom tailored to help protect you and your business.