By William D. Dyer

The work force is ever changing especially during these tough economic times that have resulted in a rise in employment claims and litigation. Big and small business owners need to protect themselves with EPLI or Employment Practices Liability Insurance that covers them for exposures relating to employment (i.e. discrimination, wrongful termination et al). Business owners don’t have the resources to battle these cases on their own, nor are they prepared to implement risk management practices to avoid them. Obtaining business employment practices liability insurance will cover litigation expenses alleged by anybody from the employee to the third party. EPLI premiums are affordable, with minimum premiums that can be less than $1,000. Here are some facts worth noting that should influence small business owners in the right direction, taken from June 2010′s issue of Best Review.

• Hartford Steam Boiler found two out of three [small business owners] were concerned that their employees will file an employment-related charge against them with only a fraction, who have some type of insurance protection for workplace claims.

• U.S. Equal Employment Opportunity Commission reports that employment claims reached the second highest level ever in 2009, with more than $376 million awarded to employees.

• EEOC statistics also show 81% of claims settle for an amount ranging from $22,400 to $40,500 (excluding defense costs).

The time is now to protect your company from employment claims. Don’t wait, because if you get sued then it is too late to buy coverage to cover that claim. A significant employment or workplace claim can be the tipping that can be the ruin of your business.

HCP National is an Employment Practices Liability, EPL, or ELPI provider or broker for over 16 years. As an EPLI broker we know the risk exposures of employment, and we know how to insure it. This blog does not alter or change coverage, nor is meant as legal advice.

Here are the 2009 Stats: (per the Employee Benefit Adviser, Feb. 2010)

• 93,000 workplace discrimination charges filed with the EEOC

• Age related claims were the second highest, resulting in 22,772 total awards, adding up to $72 million

• 21,451 ADA claims, up 10% from 2008

• Charges alleging discrimination

All of this can be mitigated through training. Human Resource cannot be everywhere. It is the supervisors and managers who need to be trained and reinforced on FMLA, EEOC, ADA and Harassment compliance because they are legally liable, which means a judgment can be levied on them. If a supervisor or manager knew it was their house and savings on the line, how quickly do you think they would want to learn?

With the new economy and those over 60 staying employed, it is imperative that all those who have any managerial power, in an enterprise, are trained and kept up to speed on HR Compliance. Profits can be eroded by the right lawsuit that goes uncovered by EPLI.

HCP National is a Compliance Educator and trainer in FMLA, FEHA, CFRA, EOC, OSHA, IRCA, Section 125, COBRA and more, as well as a full service health insurance brokerage company whose home office is located in Orange County, CA. We do not give legal or tax advice since we are not attorneys or CPA’s.

NOTE THE ABOVE IS A GENERAL DISCUSSION ABOUT HOW COVERAGES MAY WORK. YOUR INSURANCE POLICY AND ALL ADDENDUM ARE THE ONLY AUTHORITY OF HOW YOUR COVERAGE WORKS. DO NOT RELY ON THIS ARTICLE AS AN EXPLANATION OF YOUR COVERAGE. HAVE YOUR ATTORNEY REVIEW YOUR ENTIRE POLICY WITH YOU TO DETERMINE WHAT IS AND ISN’T COVERED.