Staffing agencies need a pool of talented individuals to fill client positions and run a successful business. But sometimes circumstances develop whereby a prospective job candidate, unsatisfied with his or her assignments, or believing they were somehow wronged by management, staff, or coworkers, may decide to sue the business citing unfair treatment.
Whenever a former employee claims that he or she was wrongfully terminated from their employment this can also result in charges and litigation against the employer. These are clear examples of why employment practices liability insurance, or EPLI, is so vital. It can aid a staffing firm, help avoid paying unsubstantiated claims and even avoid costly court costs and settlements that often accompany claims of this nature.
Insurance necessary for a number of possible claims
EPLI safeguards a business against the high cost of lawsuits due to discrimination, harassment, wrongful termination, and other charges associated with unfair business practices. This coverage can be used by the business to pay the cost of any legal defense, settlements, and other court fees when sued for violating a person’s civil rights or failing to provide a fair, acceptable environment for them to work in.
EPLI is coverage that protects employers against many claims by employees. For example, the policy would respond to a claim based on sexual harassment, race or age discrimination, in addition to any disability-related claims, by the employee. Temp staffing agencies, because they often do not have control & custody of their employees, have a greater level of exposure to these types of claims. Having a properly constructed policy can also offer 3rd party coverage.
EPLI will aid your business when anyone in your organization is accused of mismanaging employee benefits, wrongfully terminating employment or an implied contract, using poor judgment when disciplining or demoting an employee, or claims of sexual harassment.
If an employee sues, claiming damage to their reputation (due to slander or libel), or discrimination, based on age, gender, religion, race, or other factors, as well as breaching their employment contracts. Instruct managers not to invade an employee’s, or prospective employee’s, privacy or cause emotional or mental distress.
Given that the nature of these issues it usually is a case of one person’s word versus another, but since most companies would rather not risk litigation that results in a large settlement, employment practices liability coverage is the solution to a common workplace problem.