NONPROFIT RISK - Employment Practice Liability: What is it?

What does employment practices liability cover?
These types of policies protect employers from employee suits brought against employers for wrongful termination, discrimination, or sexual harassment. These types of suits can come from a variety of directions, including age discrimination, the American's with Disabilities Act (ADA), and gender or preference issues.

Why do I need employment practices liability?
Long hours and a young work force are contributing factors to employment practices claims. Smaller organizations are especially vulnerable because they can't afford a person dedicated to human resources until they reach a certain size level. These types of claims are now very commonplace and typical settlements range from $25,000 to $90,000. Most settlements for this type of claim are settled outside of court.

Companies that want to be protected should purchase employment practices liability as a part of their directors and officers insurance and have their human resources practices reviewed by an outside consultant.