Home About Us Departments Glossary Recent News Get a Quote Contact
LEEDS & YORK
Employment Practices Liability

With today's litigious workplace and the advent of legislation, such as the Americans with Disabilities Act and the Family Medical Leave Act, we are seeing a definite increase in employment related claims and lawsuits.

If you think your chances of being sued by an employee is one in a million... think again. The number of employment related lawsuits has increased by 15% in 2008 from 2007. The Equal Employment Opportunity Commission (EEOC) received nearly 100,000 charges. Statistics show an employer is three times more likely to have an employment related claim than a fire or general liability claim.
  • The average cost to an employer for an out-of-court settlement is $150,000.
  • The average cost to defend a suit through trial is over $250,000
  • The average jury trial award to a plaintiff is $220,000
  • 10% of awards for discrimination and wrongful termination are in excess of $1,000,000
  • 60% of employers have faced these lawsuits within the last five years - 40% of these cases have involved small employers with less than 100 employees, nearly half of which were against employers with less than 15 employees
There is a solution to this potential loss - Employment Practices Liability Insurance. Typical policies cover the following employment-related charges:
  • Age, gender and other forms of discrimination
  • Harassment - sexual or workplace
  • Wrongful discipline and termination
  • Negligent hiring, promotion and compensation decisions
  • Breach of employment contract
  • Emotional distress/mental anguish
  • Invasion of privacy
  • Slander or libel
  • Mismanagement of employee benefits, particularly pension & profit sharing plans
Employment Practice Liability policies are generally written with limits from $1 million to $25 million.

Premiums depend on the type, size and risk profile of your business. A company's employee manual and personnel policies may be considered when determining premium, especially among larger firms.

Some Directors & Officers policies contain Employment Practice Liability coverage. However, such coverage can be limited to the directors and officers and may have greater exclusions than a stand-alone Employment Practice Liability policy.