As a business owner, you dont have to do anything wrong. Someone just has to say you did.
Therefore, our task here today is to educate you on the true magnitude of your employment exposures.
Employment Practices Liability
Employment practices Liability Insurance coverage protects employers from claims made by employees alleging violations of tort law and/or various federal or state dealings with employment.
While many losses are small, there are thousands of cases a year where large damage awards and settlements are made.
Areas of Exposure for Employers
Recruiting and hiring employees.
Discipline and corrective action.
Employee and applicant testing (medical, drug alcohol, personality, aptitude, etc.)
Why Do I Need EPL Insurance?
Private company Information
Employment related lawsuits are common.
About 1 in 4 private companies (24) have experienced and EPL related event within the last 5 years.
Frequency of lawsuits increases significantly as the number of employees increases.
Percentage of companies experiencing an EPL charge or lawsuit in the past 5 years
44 for companies with 50 49 employees
66 for companies with 250 499 employees
80 for companies with 500 or more employees
Job discrimination claims rise to record levels
In wake of recent layoffs, complaints for 2008 up 15 percent
Discrimination claims filed with the Equal Employment Opportunity Commission jumped 15 percent in fiscal 2008 to 95,402 .
The highest level since the agency opened in 1965
It's possible we have yet to see the full impact of the recession on discrimination charge filings .
Job bias cases may swell to more than 100,000 in the current fiscal year that began Oct. 1 due to ongoing mass layoffs and scant hiring, among other factors.
Preliminary figures to be released by the EEOC show that claims of age discrimination saw the biggest jump last year, up 28.7 percent to 24,582.
Harsh economic conditions, the need by workers to justify or secure compensation for job loss and the frenzy to cut costs have created a volatile mix in the workplace.
Unless people have the sophistication to deal with tough times and large layoffs, theres going to be problems.
(Source MSNBC March 9, 2009)
5 (No Transcript) 6 Category FY 2007 FY 2008 Percentage
Source Equal Employment Opportunity Commission(Complaints can be filed in multiple categories.)
Employment practices claims have been really coming into their own Instead of griping about the boss around the water cooler, more folks now do their complaining at the local EEOC office.
Win or lose, each of these claims maturing past the initial filing costs someone money. The cost of defense alone now averages 125,000. The average jury award is 200,000, and employees win two of every three cases that make it to trial. And thats just the federal EEOCplenty of claims are brought at the state and local levels, which are notoriously employee-friendly.
Its not a question of if youre sued, but when.
A Chubb survey of private company executives indicated that one in three firms has experienced an EPL-related event in the past five years.
Even if the employer is completely without fault, itll cost you a lot to prove it,
Itll never happen to me. But given Americans never ending love affair with suing the pants off anyone within reach, do you want to take a chance?
(Source Agent Broker Article 5/2/08)
8 Courtesy Specialty Risk Management 9 The U.S. Equal Employment Opportunity Commission PRESS RELEASE3-9-09 BURGER KING TO PAY 85,000 FOR TEEN HARASSMENT EEOC Said 18-Year-Old Employee Sexually Harassed by General Manager ADVANCE AUTO PARTS SETTLES DISABILITY BIAS SUIT WITH EEOC FOR 50,000 AND REMEDIAL RELIEF Company Refused to Hire Man with Cerebral Palsy for Sales Job, Federal Agency Charged PRESS RELEASE3-4-09 SHOPPERS VINEYARD TO PAY 60,000 TO SETTLE EEOC RACE DISCRIMINATION LAWSUIT Clifton Store Unlawfully Fired Only High-Level African American Manager, EEOC Charged FITZHUGH FARM TO PAY 180,000 TO SETTLE EEOC SEXUAL HARASSMENT AND RETALIATION SUIT Federal Agency Charged Horse Farm Fired Farmhand Who Complained About Sexual Harassment Along With Two-Coworkers Who Were Her Witnesses PRESS RELEASE2-25-09 ASHLAND, INC. / VALVOLINE SUED BY EEOC FOR AGE DISCRIMINATION Agen cy Says Manager Harassed and Fired Because of His Age PRESS RELEASE2-18-09 GLACIER NORTHWEST TO PAY 20,000 FOR VIOLATION OF THE FEDERAL EQUAL PAY ACT EEOC Says Building Materials Supplier Underpaid Women Due to Gender 10 The U.S. Equal Employment Opportunity Commission PRESS RELEASE2-17-09 ROBERTSON SANITATION TO PAY 475,000 IN EEOC LAWSUIT CHARGING IT FAILED TO HIRE FEMALE DRIVERS Trash Removal Company Hired Less Qualified Males, EEOC Charged PRESS RELEASE2-11-09 MURPHY FORD INC. TO PAY 244,000 FOR SEX HARASSMENT AND RETALIATION AGAINST FEMALE WORKERS EEOC Said Car Dealership Fired Service Advisor for Complaining PRESS RELEASE1-22-09 PITT OHIO AGREES TO PAY 2.43 MILLION TO SETTLE EEOC DISCRIMINATION LAWSUIT Trucking Company Refused Class of Women Driver and Dockworker Jobs, Federal Agency Charged PRESS RELEASE1-13-09 CHIC AGO DENTIST TO PAY 462,500 TO SETTLE EEOC HARASSMENT AND RETALIATION LAWSUIT Orrington Firm Subjected Employees to Sexual Advances and Scientology Indoctrination and Fired Those Who Complained, Federal Agency Charged PRESS RELEASE12-31-08 MERRILL LYNCH TO PAY 1.55 MILLION FOR JOB BIAS AGAINST IRANIAN MUSLIM FORMER EMPLOYEE EEOC Settles Suit for Discrimination Based on Religion and National Origin PRESS RELEASE6-2-08 TAVERN ON THE GREEN TO PAY 2.2 MILLION FOR HARASSMENT OF FEMALES, BLACKS, HISPANICS EEOC Settles Job Discrimination Suit with Landmark NYC Restaurant