Employment Practices Liability

Whitepaper on Employment Practices Liability

Employment Practices Liability

An often overlooked type of insurance coverage that we recommend but that many fine dining restaurants fail to get is employment practices liability insurance, or EPLI. Unfortunately, claims based on workplace discrimination are on the increase throughout the United States, Canada and other countries. These claims can result from charges of wrongful termination, sexual harassment, discrimination, defamation of character, negligent evaluations, failure to promote qualified workers and invasions of privacy. The number of employment-related lawsuits have topped 100,000 cases in the United States for each of the past three years, according to the EEOC, and suits filed

Employment-Related Lawsuits

Employment-related lawsuits can generate enormous costs to defend the cases in court and pay any judgment or settlement. Employment-related lawsuits usually involve claims of discrimination in hiring and promoting practices, creating an unsafe workplace by allowing verbal or physical abuse and failing to address unsafe working conditions. Sexual harassment, gender discrimination and wage discrimination are just a few of the possibilities. These cases--when upheld in court--often result in large judgments and settlements that most restaurants can’t

Even restaurants with the safest employment practices are vulnerable to fraudulent charges and occasional lapses in judgment by staff members and managers. Litigation standards have become so soft that almost any disciplinary action could be viewed as retaliation. The money spent on investigations and attorney fees--not to mention possible negative publicity and losses of income--could prove burdensome or result in fine dining establishments closing their doors. Lapses can result from temporary fits of temper. One recent case alleged that national chain fired a server because she changed her hairstyle. The server settled the case for $250,000.