SubscribeAdd blog to your RSS feed
FeedbackWe'd like to hear from you
- Disgruntled Employee’s Alleged Parting Shot Leads to Federal Indictment
- You’re In the Zone… Of A Massive Punitive Damages Verdict for a Pregnant Manager
- The Inbox - Love Me Tinder
- Fired for Taking the Fifth: Part 1 – The Private Sector Employee
- Can A Whistleblower Break the “Law” to Blow the Whistle?
- Complaint Provides Further Details About Former CFO’s Defamation Suit Against Walgreen
- This Year’s Scariest Posts on Executive Disputes
- Employee Wins Cross-Country Wage War Against CEO
- The Supreme Court’s Recent Decision on the Taxation of Severance Payments
- The Inbox - What Would Woody Guthrie Think?
- "Key Man" Provisions
- After-Acquired Evidence
- Age Discrimination
- Arbitration and ADR
- Breach of Contract
- Change-in-Control Provisions
- Civil Litigation
- Dodd-Frank Act
- Equal Pay
- Executive Compensation
- Family Medical Leave
- Fiduciary Duties
- Fifth Amendment
- First Amendment
- Government Employers and Employees
- Monthly Roundup
- Motions to Dismiss
- Noncompete Agreements
- Pregnancy Discrimination
- Preliminary Injunction
- Religious Discrimination
- Sarbanes-Oxley Act
- Section 1983
- Severance Agreements
- Social Media
- Statutes of limitations
- Summary Judgment
- Termination With or Without Cause
- The Basics
- The Inbox
- Title VII
- Trade Secrets
- Vicarious Liability
- Wage and Hour
- White Collar Crime
- Workplace Conditions (Occupational Safety and Health)
- Wrongful Termination
Blogs We Like:
The AmLaw Daily
The BLT: The Blog of LegalTimes
Connecticut Employment Law Blog
The D&O Diary
Delaware Employment Law Blog
DeNovo: A Virginia Appellate Law Blog
The Employer Handbook
Executive Pay Matters
The Federal Criminal Appeals Blog
Grand Jury Target
Screw You Guys, I’m Going Home: What You Need To Know Before You Scream “I Quit,” Get Fired, Or Decide to Sue the Bastards
Trade Secrets & Noncompete Blog
Virginia Appellate News & Analysis
WSJ Law Blog
EPLI: If You Hire Or Manage People And You Don’t Know What That Stands For, You Should Probably Read This: Part 1
There are things we’re all supposed to do before a catastrophe occurs, to help prevent that catastrophe or minimize the harm from it. This list would include changing the batteries in your smoke detectors, or making sure your car is kept in good repair, or seeing the dentist every so often for a thorough teeth cleaning.
If you are an executive or a business owner with any role in hiring or managing others, I’m about to add one more suggestion to that list: check to figure out if you have insurance for employment-related allegations for which you may, in some circumstances, be held personally liable.
Why, you may ask? Regular readers may already know the answer: we’ve been spotting and writing about cases where individuals – not just companies – are held personally liable in cases alleging discrimination in employment or wrongful termination. For example, in Pennsylvania, a court refused to grant judgment to a company’s manager where the plaintiff alleged the manager and company had discriminated against her in violation of that state’s Human Rights Act. And recently, Baltimore colleague Andrew Torrez wrote about the intriguing case of Van Buren v. Grubb, where the Virginia Supreme Court ruled that an individual supervisor or manager – not just the company as “employer” – can be held liable where a fired employee alleges wrongful termination.
So, in the first of two posts, we’re talking about insurance for the individuals who manage, supervise or own the corporation, and the employment-related risks they face (and setting aside the rather curious, but beside-the-point, questions of whether corporations are people too).
There’s a lot to think about when it comes to insurance for the individuals who manage a business. I’ve written before about the basics of insurance for companies and managers here. In that piece (go ahead and read it – I’ll wait!), I explained that there are many different types of insurance that a business can have, and all of them are designed to cover different types of risks in different “baskets” that get transferred to an insurer. A company’s auto policy, for instance, is a basket of risks that can arise from the company’s owned or rented vehicles, while another “basket” of risks is for mistakes made by its directors and officers (“D&O”) (more about D&O insurance is here).
Business risks can be in more than one “basket,” so a claim of wrongful termination, employment discrimination, or a breach of contract dispute between an executive and her former employer, can trigger coverage under different policies, depending on the allegations and the language of the insurance contract.
There is, though, a special type of insurance designed solely for the litigation risks associated with employment, and this basket is called – coincidentally? – employment practices liability insurance (“EPLI”). Some businesses have this type of coverage added onto their regular general liability insurance as an endorsement, while others decide to buy a separate stand-alone EPLI policy. That’s an issue between the business and its insurance broker.
Now that you know what this is, you should add to your list of things to do learning whether or not your business has EPLI that will protect you from an employment-related claim. Once you’ve figured out if you’re covered under an EPLI policy – maybe your risk manager or insurance broker can guide you to an answer, depending on the size of your company – you need to figure out what your policy actually does, because there isn’t a standard form of EPLI coverage. In our next post in this series, we’ll look at a short list of things you should know about your EPLI.