Did you know that as a business owner, you are significantly more likely to be sued by an employee than by a patient or other outsider?
In fact, within the past 20 years, employee lawsuits have risen roughly 400 percent, with wrongful termination suits jumping more than 260 percent. In California alone, 5,870 Equal Employment Opportunity Commission (EEOC) charges were filed for in 2016, comprising 6.4 percent of all of the charges in the United States. While an employer may be sued by a staff member for one of many reasons, the top four suits are:
- Harassment
- Discrimination
- Unlawful Termination
- Violation of the Americans with Disabilities Act (ADA)
The financial damage of employee lawsuits can be dramatic, whether or not there is merit: The cost of settling out of court averages $75,000, and the average jury award hits $217,000. Minimally, you could be out of pocket thousands of dollars to simply respond to an EEOC claim. And it’s not just large corporations that are being hit. Roughly 41.5 percent of employee lawsuits are brought against private companies with fewer than 100 employees.
EPLI: Not Just a Nicety, but a Necessity
Many employers believe that their liability or workers’ compensation insurance covers employment-related lawsuits, but unless you have an Employment Practices Liability Insurance (EPLI) policy in place, your business is at risk. EPLI provides a practice of any size with cost-effective coverage to help protect it against employee claims alleging sexual harassment, discrimination, wrongful termination, breach of employment contract, negligent evaluation, failure to employ or promote, and deprivation of career opportunity.
The cost of EPLI insurance is a fraction of what you will pay if you end up on the losing side in a lawsuit. EPLI premiums will vary depending on a number of factors:
- The number of employees
- The amount of coverage purchased
- Whether your company has anti-discrimination and anti-harassment human resources policies in place
- Whether your company has had any EEOC complaints or lawsuits filed against it in the past
The good news is as a CAP physician member, you already have a $50,000* defense-only benefit provided by your Employment Practices Plan. As you can see from the above examples, this benefit would help, but probably not cover all claim costs. CAP Physicians Insurance Agency, Inc. (CAP Agency) offers our physician members highly competitive rates for EPLI coverage — provided by an A+-rated carrier.
You owe it to yourself and your practice to get a quote. We at the CAP Agency stand ready to help you protect your practice. Contact us at 800-819-0061 or email us at CAPAgency@CAPphysicians.com for more information.
*The above is for informational purposes only and does not guarantee coverage; nor does it fully outline individual policy terms, including but not limited to coverage exclusions.