These days, talk of sexual harassment is practically everywhere – from Hollywood to Wall Street. People are generally becoming more aware of what constitutes harassment and that makes employers extremely vulnerable. 

Not only are you subject to liability for employees that may harass other employees, but you also may be held accountable for alleged harassment involving a third-party that is associated with your organization.

Employee Practices Liability Insurance (EPLI) provides the protection for your organization in the event of alleged or actual incident of harassment. EPLI doesn’t just protect your organization against sexual harassment, but against many other wrongful acts. Other types of covered wrongful acts include (but not limited to) any type of discrimination, wrongful termination, failure to promote, defamation, invasion of privacy, deprivation of a career opportunity, and hostile work environment. Gone are the days when this type of behavior is “swept under the carpet” and employers need to demonstrate leadership by taking every allegation seriously and conducting due diligence – even if it leads to potential liability.

The other day, I was asked by someone how many employees are necessary before I would recommend EPLI insurance. My answer? One.

Even if you have just a single employee – yourself – you are not immune from harassment allegations from customers, vendors with whom you work, and others.

The simple fact is that every business and organization needs EPLI. There are many insurance carriers that provide EPLI coverage with many different options.

If you need further convincing, take a look at some simple scenarios that you could be held accountable for:

• An employee offends another employee by telling an off-color joke.
• You offer early retirement packages to some employees but not to others.
• You are deciding upon two women for promotion and choose the one who is not pregnant.
• You don’t allow an employee to return from a medical leave unless they can perform all job duties.
• You pay a man and a woman with similar backgrounds different amounts for the same job.

You may think that your basic business liability insurance is enough to cover such a claim, but that is not the case – you need a separate policy that spells out coverage for specifically these types of issues. Many employers also have a mistaken belief that a good HR department can protect against these claims or handle any problems that arise. When it comes to this type of serious allegation, however, that is simply not the case; don’t be surprised if the U.S. Equal Employment Opportunity Commission (EEOC) even ends up joining the lawsuit. These lawsuits end up in federal court and are expensive to defend.

The good news is that over the two decades General Insurance Services has been advising clients of EPLI coverage options customized to their specific exposure along with providing resources to mitigate their risk. Also, EPLI premiums have come down dramatically due to increased competition and access to better loss data. General Insurance Services represents many EPLI carriers, each with expertise in different markets and industries.

This article was published in the Spring 2018 issue of the General Insurance Services Risk & Business Magazine.  Access the full publication here.

Charlie Keene

Charlie was raised in Michigan City. He attended Ball State University and graduated with a BS degree in Insurance and Risk Management. Charlie began his career in 1997 at an independent insurance agency in Central Indiana as a commercial property and casualty agent. He joined General Insurance Services in 2005 as a commercial property and casualty insurance agent. Charlie and his wife Beth have four daughters. He currently serves on the Chamber of Commerce and United Way Boards and is involved in several community outreach programs. In his free time, he enjoys spending time with his family.