#MeToo claim? Your CGL probably won’t protect you

Relying on your commercial general liability coverage for protection against harassment, discrimination and wrongful termination suits is not the best strategy. Proven personnel best practices are your first line of defense to protect your business and employees.

To prevent employee lawsuits, educate your managers and employees so you minimize problems in the first place:

• Create effective hiring and screening programs to avoid discrimination
  in hiring.
• Post corporate policies throughout the workplace and place them in employee handbooks, so policies are clear to everyone.
• Review performance evaluations and “write-up” procedures, and be vigilant in any disciplinary setting to treat employees in a similar fashion, applying the same standards to similar situations.
• Review and update exit interview procedures. Take all necessary measures to ensure that the exit interview is conducted in a fair manner.

Following good personnel practices alone doesn’t insulate you from liability. Standard business policies and commercial general liability coverage provide little or no protection against employment practices claims. And, coverage for such claims has been omitted from the employers section of workers’ compensation forms and your general liability policies. However, there is coverage available—employment practices liability insurance.

Defending against any allegation can prove to be expensive. Discrimination and harassment suits are becoming so common that courts nationwide can barely keep up. More than 91,000 charges of wrongful termination were filed with the U.S. Equal Opportunity Commission in 2016. Settlements and award costs are skyrocketing. And whether the jury sides with you or not, your legal costs could be staggering. These costs are covered by an EPLI policy.

EPLI offers protection against the crippling costs of wrongful termination, discrimination and sexual harassment suits. It provides defense for the company and the employees named as defendants in a lawsuit. It may include a wide range of monetary damages, including loss of wages and benefits. Most policies cover the cost of investigating, defending and settling claims.

Call our agency to discuss your company’s need for employment practices liability insurance. If you already have an EPLI policy, contact us to review your policy limits and coverage.