Employment Practices
Liability Insurance (EPLI)

EPLI covers your organization when a current, former, or prospective employee brings a claim of wrongful termination, harassment, discrimination, or retaliation.

Employment Practices Liability Insurance (EPLI)

Employment claims, including wrongful termination, harassment, age discrimination, and retaliation, are the most common lawsuits businesses face today, and they apply to companies of every size. An EPLI policy covers your legal defense costs, settlements, and judgments when a current, former, or even prospective employee files a claim against your organization. It extends to officers, directors, and employees named in the suit, not just the company itself.

When our team reviews an EPLI program, we look at whether third-party coverage is included (for claims by customers or vendors), how the policy handles wage-and-hour exposure, and whether there are any gaps around independent contractor classifications. Limits and retentions Limits and retentions matter here too; defense costs can exceed the actual settlement. Request a program review and let’s make sure your workforce exposure is properly covered.

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EPLI is essential for your organization, we can help.

Claims of age discrimination, wrongful termination and sexual harassment can cost your company millions regardless of if they’re frivolous or not. Let’s work together to reduce your total cost of risk and secure peace of mind by building a risk management policy with one of the nation’s leading insurance carriers.

By The Numbers

Over the past twenty years, the rate of EPLI lawsuits has increased by an extraordinary 400%. Businesses must be aware of and defend themselves from allegations including discrimination and wrongful termination.

Did You Know?

Your business is three times more likely to be sued over EPLI claims than to experience a fire. EPLI claims cost employers an average of $70,000 per claim with median settlement values exceeding $300,000 for cases that reach a jury.

Employment Practices Liability Insurance FAQ’s

EPLI (Employment Practices Liability Insurance) guards employers against claims brought against them by employees alleging that their rights were violated either by the company, or by another employee.

The cost of EPL coverage is determined by the number of employees, the extent of the desired coverage, strategies currently enforced to prevent and discourage discrimination, and prior discrimination claims and EEOC complaints or court cases.

Enforcement of the Fair Labor Standards Act (FLSA) and similar state laws have resulted in huge damages from employee misclassification issues, such as classification of an employee as full time versus part time, independent contractor versus employee, or salaried versus exempt.

Employers may receive demands from current, former, and prospective employees for actions perceived as discriminatory, hostile, or retaliatory. Additionally, recent social movements have brought best practices to the forefront of board member discussions about employers’ insurance coverage and its importance for the protection of a company and its directors and officers.

EPLI covers both the organization and its insured persons including officers, directors, employees and independent contractors for legal defense costs, settlements and judgements that arise from claims of:

  • breach of an employment contract, deprivation of a career opportunity, or failure to employ or promote
  • discrimination (age, sex, race), sexual harassment, hostile work environment, or active bullying
  • mismanagement of employee benefits
  • defamation or privacy violations
  • violations of common employment laws.
  • wrongful termination or wrongful discipline

Generally speaking, Employment Practices Liability (EPL) insurance policies don’t cover wage and hour claims or violations of Worker’s Compensation laws, FLSA, NLRA, the Worker Adjustment and Retraining Notification Act, OSHA or ERISA. Additionally, EPLI doesn’t provide punitive damages coverage nor claims related to criminal activities.

Knowing the following employment laws are essential:

  1. The Fair Labor Standards Act (FLSA) puts a limit on the working hours an employee can have in a week and sets the minimum wage. Moreover, it prevents wage disparities between men and women, entitling them to equal pay.
  2. The Family and Medical Leave Act (FMLA) gives employees the right to take 12 weeks of unpaid leave with job security and healthcare coverage, although not every employee is included.
  3. The Age Discrimination in Employment Act (ADEA) forbids age-based discrimination when it comes to hiring, firing, or promotions.
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