Bartlett Group

This was on behalf of a qualified black applicant who the federal agency says was refused hire for a financial planning manager position because of her race, despite substantial work experience. Most employers don't intentionally condone practices of discrimination or harassment—the two leading allegations brought by plaintiffs—and many follow good employment practices. Yet even employers who are innocent of wrongdoing can be targets of EPL lawsuits, which can be devastating—and not just to a company's bottom line.

In addition to the $300,000 in monetary relief for the claimant in the abovementioned settlement, the two-year consent decree includes injunctive relief prohibiting the company from engaging in discrimination or retaliation, anti-discrimination training, and the posting of a notice about the settlement. A charge of discrimination may cost millions, and could also damage a company's image, hurt employee morale, negatively affect revenues and have an adverse impact on staff recruitment and retention. Even an innocent company may be strongly tempted to settle out of court.

More and more companies are finding out the hard way how complex the employment relationship is. With more federal, state, and local employment laws on the books than ever before, employers now operate in an environment fraught with EPL landmines and tripwires. The EEOC's statistics are numbing. Every day, the EEOC receives some 200 new EPL complaints alleging discrimination based on race, sex, disability, age, religion, and national origin; sexual harassment; wrongful termination; retaliation; and other complaints. The average award for each case is $200,000.

Whilst there is no substitute for robust procedures, training of managers and HR personnel and the right corporate culture, Employment Practices Liability Insurance can be arranged to protect businesses from a potential claim. This can include:

• Worldwide Coverage—no matter where you employ your people, we can arrange cover under one policy
• A broad definition of covered loss including defense costs, damages, judgments, settlement, back pay, front pay, as well as court awarded claimant's attorney's fees
• Punitive damage coverage—where they are insurable by law
• No "intentional acts" exclusion—most employment-related claims arise out of some form of intentional conduct; some insurers will specifically exclude intentional acts

For more advice on how to mitigate the financial and reputational risk of harassment claims, please contact us.