Many business owners are not aware that general liability does not cover claims related to hiring, firing, discrimination, or other employee issues. Those type of claims are covered by employment practices liability insurance, also known as EPL coverage. The number of EEOC complaints filed against businesses continues to rise, making EPL coverage more important than ever. Here are some common EPL claims faced by business owners and steps you can take to protect your company.
Common EPL Claims
Illegal or Improper Background Checks
Running a pre-employment background check makes sense before extending a job offer. However, business owners must be certain they are in compliance with the Fair Credit Reporting Act and similar state laws. You should always obtain written permission to run the background check. Consider carefully whether the job position requires a credit check. If the decision to not hire is based on erroneous or inaccurate credit information, the employer could be subject to fines and/or an EPL claim.
Interns that benefit your company economically or are doing work normally performed by other employees must generally be paid. The US Department of Labor has established guidelines to help you determine if an intern is really an employee subject to Federal labor laws. Essentially, an internship should be designed around career and vocational education, not free labor for the employer.
An employer must take great care not to discriminate against a pregnant employee when hiring, firing, promoting, or determining pay. Further, medical conditions related to pregnancy must be treated like any other temporarily disable employee: light duty offered, alternative assignments, disability leave, or unpaid leave (i.e. FMLA). The EEOC has made pregnancy discrimination a top priority and will aggressively investigate complaints.
Understand EPL Insurance
Employment practices liability insurance, or EPL coverage, provides broad protection to business owners for many types of employment-related disputes. EPL insurance is affordable and simple to quote. In fact, you can obtain an EPL quote on our website in less than 10 minutes. Contact us today for more information about common EPL claims and how you can protect your business from employment-related disputes.