EPL Insurance Covers Much More than Your Employees
Over the past ten years, Employment Practices Liability insurance (EPLI) has become a mainstay insurance product. Almost all companies purchase this coverage in some degree. It protects a company in the event that one of their employees has a covered claim stemming from the action of another employee. We often see this situation when an employee creates a hostile work environment for another employee, or an employee is fired and they believe that the reasons for the firing are not legitimate. Typically, these are the claims that are covered by an EPLI policy.
However, there are two situations that don’t involve employees that you should have coverage for. This EPLI coverage extension is inexpensive but can save your manufacturing facility from the costs of an expensive lawsuit. The two scenarios are:
- Your employee claims to be harassed by a third party. Think of a parcel delivery person that makes comments to your receptionist each and every day. If the employee complains about this to you and you fail to act, you can be responsible.
- Your employee harasses another person. Think of scenario #1 but instead your company is the third party. You can potentially be sued by the company you’re working with for the actions of your employee.
You should check your insurance policy to ensure that you do have both of these coverage extensions on your policies. These coverage extensions are even more important if your plant or facility gets a lot of traffic from the general public or if your business relies on third parties doing work at your locations.
Lastly, beyond the insurance coverage extension, you should have the proper policies and procedures in place that address these issues. These procedures can include due diligence on third parties that come to your facility and also training for your own employees. This extension of coverage under your EPLI might just be the preventive procedure that will save your facility from future claims.
- Understanding Employment Practices Liability Insurance Webinar
- Order of Events: Submitting Potential EPLI Claims
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