Is the ACA Increasing Employment Practices Liability Risks?
Employment Practices Liability (EPL) Insurance is designed to provide defense and indemnification to businesses named in lawsuits based on employment decisions and actions. Your clients may face a claim against wrongful termination, harassment of some kind, or discrimination based on gender, age, race, etc. Even if these claims are unfounded, the defense costs and legal fees your client would face could be detrimental to just about any type of business.
Everyone is aware by now of the Hobby Lobby case in which the Supreme Court sided with their decision to deny coverage of certain contraceptives to their employees. Hobby Lobby is just one of the dozens of privately held companies that chose to file suit over the Affordable Car Act requirement of the inclusion of contraceptive coverage in their insurance policies. While this was a legal win for Hobby Lobby, this type of situation could certainly open the door to Employment Practices Liability claims.
Experts urge that in 2014, as the healthcare reform becomes fully effective, that employers turn their attention to assessing what new liabilities may arise under this healthcare law, and whether their existing insurance policies will cover those liabilities. In the case of Employment Practice Liability, if companies are denying certain aspects of healthcare based on religious grounds, they may find themselves facing religious discrimination claims.
EPL claims based on religious discrimination don’t just arise from healthcare issues. Religious-based Employment Practices Liability claims can arise from:
- Wrongful failure to employ or promote
- Wrongful deprivation of a career opportunity
- Wrongful demotion or negligent evaluation
- Wrongful discipline
- Employment-related misrepresentation
- Employment-related libel, slander, humiliation, defamation or invasion of privacy
While the ACA may not directly be increasing Employment Practices Liability risks, it is raising questions and concerns, and creating potential legal dilemmas that could lead to a claim against your clients. At PL Risk, we feel that whether you are, or your client is, head of a large corporation or a small business owner, Employment Practices Liability Insurance should be party of your comprehensive insurance program. Please contact us for more information at (855) 403-5982.