Employment Practices Liability Insurance
Boise, Idaho Falls, Logan, Still & Leavitt - Mountain Home, ID, Rexburg, Rigby, South Salt Lake, Tremonton, Twin Falls - Alta Insurance

EPLI is a type of business insurance designed to address certain claims involving the relationship between an employer and its employees, applicants, or former employees.

A claim may arise from a hiring decision, disciplinary action, promotion, termination, workplace complaint, or another employment practice. EPLI coverage can help with covered defense costs and other expenses associated with responding to these allegations.

Every employer faces some degree of employment liability exposure. A claim does not necessarily mean that an employer acted improperly, but responding to one may still require legal assistance, documentation, management time, and financial resources.

What Does EPLI Cover?

EPLI coverage varies by insurance company and policy. Depending on the policy, coverage may respond to allegations involving the following areas.

Wrongful Termination Claims

A current or former employee may allege that the business dismissed them improperly or for an unlawful reason. Wrongful termination insurance may help address covered defense expenses and related claim costs.

Workplace Harassment

EPLI may cover certain allegations of workplace harassment, including sexual harassment claims. Policy language determines which individuals, conduct, and circumstances are covered.

Discrimination Claims

An employee or applicant may claim that an employment decision involved discrimination based on age, gender, race, religion, disability, or another protected classification. EPLI may help the business respond to a covered discrimination lawsuit.

Retaliation Claims

Retaliation allegations may arise when an employee believes the employer took adverse action after the employee reported a concern, filed a complaint, or participated in an investigation.

Failure to Hire or Promote

Employment claims can involve decisions made before or during employment. EPLI may respond to covered allegations that a business improperly refused to hire or promote an individual.

Employment Contract Disputes

Some policies may address certain allegations involving employment agreements or other employment-related contractual obligations. The scope of this coverage depends on the individual policy.

Defense Costs

Legal fees may represent a substantial part of an employment claim. EPLI can help address covered defense expenses and settlements, subject to the policy’s limits, deductible or retention, exclusions, and other terms.

Why Employers Should Consider EPLI Coverage

Good policies and thoughtful management practices can reduce risk, but they cannot prevent every employee complaint or allegation.

Workforce growth, changing employment requirements, increased awareness of workplace rights, and the visibility created by social media can make employment disputes more complex. A claim may also affect more than legal expenses. Leadership time, workplace relationships, and the organization’s reputation can all come under pressure.

EPLI gives businesses a financial tool for responding to covered employment claims while helping protect resources reserved for operations and growth.

Common Employment Claims Businesses Face

Employment claims may involve allegations of:

• Wrongful termination
• Workplace or sexual harassment
• Discrimination
• Retaliation
• Failure to hire or promote
• Inappropriate workplace conduct
• Family and Medical Leave disputes
• Hiring practice violations
• Wrongful discipline
• Certain wage and hour disputes

Not every event listed above will be covered by every EPLI policy. An insurance agent can help you review the policy’s definitions, exclusions, reporting requirements, and coverage limits.

Who Needs EPLI Coverage?

Any organization with employees may face employment-related allegations. EPLI can be especially important for organizations that are adding employees, opening new locations, changing leadership, or formalizing their human resources processes.

Small Businesses

Small businesses may have limited internal human resources and legal resources. As employee counts grow, hiring, discipline, leave, promotion, and termination decisions can create additional exposure.

Professional Service Firms

Employee disputes can create financial and reputational concerns for firms built around client relationships, confidentiality, and trust.

Contractors

Contractors may manage changing crews, seasonal labor, multiple job sites, and a range of supervisors. These workforce management challenges can create employment-related risks.

Manufacturers

Larger or varied workforces may involve multiple shifts, supervisors, job classifications, and workplace procedures, increasing human resources complexity.

Health Care Organizations

Frequent employee interaction and regulatory oversight can make clear workplace policies, documentation, and complaint procedures particularly important.

Nonprofit Organizations

Nonprofits, boards, and organizational leaders can still face employment-related allegations. EPLI can help protect the resources devoted to the organization’s mission.

What EPLI Typically Does Not Cover

EPLI policies contain exclusions and limitations. Depending on the policy, coverage may exclude or limit claims involving:

• Intentional criminal acts
• Certain wage and hour violations
• Bodily injury
• Workers compensation
• Obligations covered under other types of insurance
• Conduct or claims specifically excluded by the policy

Exclusions differ by insurance company and policy form. Review the complete policy language with your insurance agent to understand what the coverage includes, what it excludes, and how defense costs affect the available limit.

EPLI and Human Resources Risk Management

EPLI can play an important role in a broader employment risk management approach. Consistent practices may help your organization reduce misunderstandings, support fair decision-making, and provide documentation if a complaint occurs.

Your employment risk management process may include:

• A current employee handbook
• Consistent hiring and interviewing procedures
• Clear job descriptions
• Documentation of workplace decisions
• Established performance management practices
• Manager and employee training
• Accessible complaint-reporting procedures
• A process for investigating reported concerns
• Periodic reviews with qualified legal and human resources

EPLI does not replace sound management practices or employment law guidance. Instead, it can provide an additional layer of financial protection when a covered allegation occurs.

How Much EPLI Coverage Do You Need?

The appropriate amount of EPLI coverage depends on the characteristics of your organization and its workforce. Factors to review may include:

• Company size
• Number of employees
• Industry
• Geographic locations
• Claims history
• Revenue
• Human resources structure
• Workforce growth
• Policy defense provisions
• The organization’s ability to retain risk

An insurance agent can help you compare limits, deductibles or retentions, exclusions, and coverage options based on your organization’s circumstances.

Why Work with Leavitt Select Insurance Services?

EPLI policies can differ in their definitions, exclusions, limits, and defense provisions. Leavitt Select Insurance Services can help you evaluate available options and understand how those differences may affect your coverage.

As an independent insurance agency, we can assist you with:

• Comparing coverage from multiple insurance companies
• Reviewing policy terms and exclusions
• Identifying potential gaps in your insurance program
• Evaluating limits and retention options
• Coordinating EPLI with your other business insurance
• Navigating the claims process
• Reviewing your coverage as your workforce and operations change

Our goal is to help you make an informed decision and find coverage suited to your organization’s needs.

Prepare Your Business for Employment-Related Claims

Your employees are central to your organization, but managing a workforce also creates responsibilities and risks. Let’s review your current insurance and determine whether EPLI coverage belongs in your risk management plan. 

Frequently Asked Questions

• What is the difference between EPLI and workers compensation?

  EPLI addresses certain allegations involving employment practices, such as wrongful termination, harassment, discrimination, or retaliation. Workers compensation generally applies to job-related employee injuries and illnesses. The two coverages serve different purposes, and workers compensation claims are commonly excluded from EPLI policies.

• How much EPLI coverage should I buy?

  Consider your employee count, industry, geographic footprint, revenue, claims history, human resources structure, and capacity to retain risk. An insurance agent can help you compare limits and policy terms.

• What industries need EPLI the most?

  Any organization with employees can face an employment claim. Small businesses, professional service firms, contractors, manufacturers, health care organizations, nonprofits, and rapidly growing employers may have particular reasons to evaluate coverage.

• Does EPLI cover claims from former employees?

  Some EPLI policies may address covered claims brought by former employees. Coverage depends on the policy’s definition of an insured person or claimant, the alleged conduct, when the claim was made, and applicable reporting requirements.

• Does EPLI cover discrimination lawsuits?

  EPLI may respond to covered discrimination allegations involving age, gender, race, religion, disability, or other protected classifications.

• Does EPLI cover wrongful termination?

  EPLI may cover allegations that an employee was terminated improperly or unlawfully. Coverage depends on the policy’s definitions, exclusions, limits, and other terms.

• Does EPLI cover harassment claims?

  Many EPLI policies address certain workplace harassment allegations, including sexual harassment claims. Review the specific policy to determine the scope of coverage.

• Is EPLI included in a business owners policy?

  Coverage arrangements vary. EPLI may be offered as a separate policy or through an endorsement, depending on the insurance company and the business’s insurance program. Review the applicable policy documents to determine whether employment practices coverage is included.

• Is EPLI required by law?

  Requirements can depend on the organization’s location, contracts, and circumstances. Even when an organization is not required to carry EPLI, it may choose coverage to help manage the financial impact of employment-related claims.

• What does EPLI stand for?

  EPLI stands for employment practices liability insurance. It is designed to help businesses address certain claims arising from employment practices and workplace decisions.