Want to get fired? Don’t buy EPLI

It’s really easy for your employees to sue you for discrimination, harassment, wrongful termination or anything they want to make up. They do not even need a lawyer. All they have to do is file a complaint with the state EDD department and the state will serve you a demand for damages and info. Then you have to hire a lawyer to defend yourself. Even if you win with the state EDD pro employee bureaucrats the employee can still hire an attorney and sue you.

If the EDD finds against you they will prosecute you for free. We had an employee do this and the EDD ran up $5000 in legal bills on our end just so they could justify their jobs before finding the case without merit 9 months later. Good thing we had paid $3000 a year for coverage.

A Company

Here is an example of what could happen to any company. A man was fired by his employers 5 years ago. According to him, a few days after he told his supervisor about an unethical business practice he found his company was indulging in, he was fired on grounds of his age (he was 71) and the need to cut the wage bill. He sued to company for wrongful termination and age discrimination. He recently won the case and the

total award, on different grounds, was $3.5 million. In the meantime the company he worked for was bought up by another business and that business is now stuck with the cost.

The question here is not whether the man had a legitimate claim or not. The new owners of the company are stuck with a huge payout, not to mention the cost of the legal fees they have borne. If it has EPLI, it is protected. If not, that kind of payout is going to have a serious effect on the bottom line.

A Manager

And what happens to the manager who conducted the due diligence before the take over? Maybe the facts of the case convinced him that the employee could not win and that the chance of having to pay out a large sum of money was so small it was a risk worth taking. Maybe he acted in the best interest of his employer. But now that the case has been lost, what happens to him? Is he busy working on his resume?

However, if there was EPLI, then any risk was covered and the manager, his company

and the bottom line are all protected.

With Employment Practices Liability Insurance, a business is typically covered against:

• Wrongful termination of employment
• Workplace discrimination
• Workplace harassment
• Emotional distress
• Some defamation claims
• Some privacy based claims

We had one client that declined the EPLI coverage. The next year they lost a $750,000 sexual harassment case against a manager. The manager was fired AND the CONTOLLER also was fired. If you are in charge of buying your companies insurance protect your job and buy EPLI. We live in CALIFORNIA after all.

It could happen to any business. Why risk it happening to you when EPLI can provide an effective line of defense?

Must-Have Insurance for Lecherous Employers

Ex-Desperate Housewifes star, Nicole Sheridan, sued ABC for $6 million in damages for wrongful termination. This case has been going on for years and the restart button was hit again when her lawsuit recently ended in a mistrial. Her case will probably be retried, costing ABC far more in the end than $6 million. Whatever the outcome, nobody will win except the attorneys.

Your pockets may not be as deep as ABC’s, but you can make sure you will be able to afford the best legal protection against disgruntled employees with supplemental EPLI coverage. If you are a business owner; you need to know that your normal business property and liability policy does NOT cover employment practices liability (EPLI).

In fact, EPLI is a supplemental policy that only 25% of employers are smart enough to have. Allied Broker’s largest uncovered claim since 1954 was a client who did not follow our recommendation to buy this essential and affordable protection. One of the company’s managers was accused of sexual harassment by another employee. $700,000 in damages later, not including attorney’s fees, the executive who failed to take our advice was collecting unemployment- and probably plotting his own wrongful termination suit.

California is a pro-employee state. To sue an employer, employees needn’t even hire an attorney. All they have to do is file a claim with the state’s EEOP Department and the agency will defend them for nothing. You the business owner, on the other hand, must hire an attorney and even if you win, you will still be out $5,000-10,000 minimum- with no recourse to recover your costs.

The EEOP Department justifies its existence by dragging you and your attorney through the wringer. Employers are considered guilty until proven innocent. If the EEOP finds any reason to pursue the case against you, they will take you to the woodshed on the taxpayer’s dime, at no cost to the employee. If the EEOP lets you go, the employee is still free to hire an attorney to pursue a civil case against you. Then the fun really begins- “heads” the employee wins, “tails” you lose.

EPLI insurance is very reasonable. A $1 million liability policy that includes legal defense starts at under $2000 per year- a lot cheaper than losing your business to some made up (or real) claim by an ex-employee. You might be someone who would never intentionally do anything wrong, or you might be an unrepentant, backside-grabbing lech; either way you need to get EPLI coverage to protect your business. Call Allied Brokers today to learn more.

Visit our website at http://www.alliedbrokers.com/ for information about all the types of insurance we offer. Or call 1-888-505-7988 for a free rate quote.