Small Businesses Can’t Afford Not to Have EPLI

The Equal Employment Opportunity Commission (EEOC) is the federal agency that monitors employment discrimination. Over the last several years, EEOC claims have been on the upswing. In 2012, the EEOC received more than 99,412 private-sector discrimination charges, up from 2009, when charges totaled 93,000 and represented the second-highest level in two decades.

Employment claims aren’t likely to disappear. The previously amended American with Disabilities Act (ADA) expanded the number of people covered under the Act, and as our population ages at a faster rate, more employees than ever will be protected by the ADA. With other economic, political and social changes in the offing, your organization simply can’t afford to operate without Employment Practices Liability Insurance (EPLI).

For smaller companies, in particular, one of the advantages of buying coverage is the risk management assistance most EPLI carriers provide. Employment practices carriers can help reduce your risk by reviewing your current employment policies, if you have them, or helping you develop them if you do not.

If you believe you cannot afford EPL coverage, consider this: For companies with 15 to 100 employees, the courts can award damages of up to $50,000. Add in defense costs, and your business faces substantial risks. Even if a claim is settled outside court, you will have to re-hire or promote the claimant and could be on the hook to pay the employee’s legal costs.

With this much money at stake, can you really afford not to have this coverage?