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The Risk of Employment Practices Violations

The Risk of Employment Practices Violations

The Risk of Employment Practices ViolationsThe Equal Employment Opportunity Commission (EEOC) receives tens of thousands of claims by employees and former employees each year. In fact, in 2015 there were 89,385 discrimination cases filed with the EEOC. Topping the list were retaliation claims at 39,757, followed by discrimination allegations involving race (31,027), disability (26,968), sex (26,396), age (20,144), national origin (9,438), religion (3,502), color (2,833), the Equal Pay Act (973), and the Genetic Information Non-Discrimination Act (257). According to the EEOC, in 2015 the agency secured more than $525 million for victims of discrimination in the private sector and state and local government workplaces through voluntary resolutions and litigation.

Moreover, no employer is immune from employment-related lawsuits, especially in today’s highly regulatory environment and when the Department of Labor, the EEOC, and the National Labor Relations Board are committed to taking an increasingly proactive and aggressive stance against workplace-related issues.

Be Aware of These Five Major Federal Employment Laws

  • Title VII of the Civil Rights Act of 1964 (Title VII): This prohibits discrimination based on race, color, religion, or national origin. Additionally, Title VII also prohibits sexual or sex-based harassment—especially behavior that creates a hostile work environment, or policies and actions that use sex or gender to justify refusal to hire or promote, firing, or demotion.
  • Age Discrimination and Employment Act of 1967 (ADEA): Prohibits employment discrimination against persons 40 years of age or older, including hiring and firing practices, denial of opportunities, and wage discrimination related to the age of a worker.
  • Americans with Disabilities Act of 1990 (ADA): Prohibits discrimination on the basis of disability, and requires employers to provide reasonable accommodations requested for a disability. The ADA also prohibits the disclosure of confidential medical information and prohibits an employer from interfering with an employee’s right to make use of the protections of the statute.
  • Family and Medical Leave Act of 1993 (FMLA): Requires certain employers to provide up to 12 weeks of leave (during a 12-month period) to eligible employees who need time off because of a “serious health condition” experienced by themselves or by a family member. FMLA regulations interact with Title VII requirements for pregnancy-related leave and ADA and Rehabilitation Act rules for accommodations for employees with disabilities.
  • Genetic Information Nondiscrimination Act of 2008 (GINA): Prohibits the use of genetic information to discriminate in employment and puts restrictions on employers requesting, requiring, or purchasing genetic information on their employees.

In addition, there are numerous minor acts and amendments that have further affected the regulatory landscape. Also, many states and cities have their own employment laws that must be followed.

Smart companies looking to minimize their exposure for employment-related lawsuits should carry properly secured Employment Practices Liability Insurance (EPLI). EPLI policies typically provide coverage for a broad range of claims, including claims of discrimination based on race, age, gender or national origin, as well as claims alleging sexual harassment and wrongful termination. However, they are not one-size-fits-all and require close examination to ensure that your firm’s exposures are adequately covered.  For instance, most policies will cover retaliation claims as well, while some policies can be customized to provide coverage for claims alleging breach of employment contracts, defamation, failure to promote or negligent evaluation, wrongful discipline, and workplace torts. In addition, wage-and-hour claims can be covered by endorsement by some policies.

Axis Insurance Services specializes in EPLI coverage and would welcome the opportunity to discuss our solutions with you. Just give us a call at (877) 787-5258.

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Blogged on: April 11, 2016 by Mike Smith
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