Immigration Coverage and Employment Practices Liability
EPLI Tips for Construction
Employers now, more than ever, have a greater risk for immigration-related claims. Not to mention, an increased employment practices liability insurance exposure.
The Federal Government has become stricter on organizations with undocumented employees. The Justice Department’s rule has broadened the definition of discrimination to include, “any intentional treatment that differentiates between employees because of national origin or citizenship status, regardless of the reason for difference.” It also broadens the definition of “hiring” to include actions taken during the recruitment process. This can include circumstances in which an employer attempts to help noncitizen employees stay current with work eligibility in the United States, but misunderstands the laws regarding reverification of work authorization. The regulation comes in the wake of a substantial increase in civil fines against employers who commit immigration-related offenses, including Form I-9 and E-Verify violations, unlawful employment of foreign nationals, unfair immigration employment practices and H-1B and H-2B program violations. This new plan is causing many employers to think about whom they're employing and their hiring practices.
Because these are thought of as employment practice liability (EPL) issues, most employers think they’re adequately insured and don’t need to worry. Unfortunately, this is typically not the case. While EPLI may cover similar types of hiring exposures, this type of loss probably isn’t covered. Typically, EPLI covers some recruiting practices, but for the most part, it covers risks concerning wrongful termination, discrimination and sexual harassment.
To be adequately covered, there’s an EPLI policy enhancement, which is available by endorsement with most carriers. This coverage is most likely not automatically included and must be requested. The sub-limits range on average from $25,000 to $100,000 as an example. It’s also important to note the sub-limit typically only covers the defense costs and not the fines that are accessed by the government agency. Therefore, a risk management plan, especially in the hiring process, is also important and will help minimize risk and potential loss.
Unfortunately, employers cannot control employees or past employee’s actions. But, you can control your business policies and how to mitigate EPL cases. Don’t assume something will not happen to your construction company or that a faithful employee will not turn after a termination. Talk with your Assurance ‘A’ Team expert about comprehensive EPLI coverage with the right enhancement endorsements, implementing a strict hiring and firing policy and checking that all employee files are secure and up-to-date.
- Compliance Support Page
- Worst Case Scenario Savior: EPLI
- Order of Events: Submitting Potential EPLI Claims
ABOUT THE AUTHOR