Employment Practices Liability

Why do you need it

Given the high frequency of employment practice claims in comparison to other management liability claims it is a good idea to have a separate Employment Practices Liability (EPL) policy.

An EPL policy covers claims against directors, officers, employees, the company and its subsidiaries. The policy covers a long list of claims including wrongful dismissal/termination, sexual/racial/disability harassment, sexual/racial/disability/religious discrimination, employment related libel, slander, defamation and invasion of privacy, wrongful failure to employ or promote and retaliation.

The number of claims filed by employees against their employers has been rising, over 40% of EPL claims are against firms with fewer than 100 employees.

D&O policies only include cover for employment practice claims brought against individual directors. Crucially, buying a separate EPL policy protects the company as well as the individual, and helps to ensure that the limit on your D&O policy is not eroded unnecessarily.

What is covered

We have a broad definition of Employment Claim, encompassing the following:

  • A written demand for monetary damages and/or non-monetary relief
  • A civil proceedings including tribunal proceedings, applications for injunctive or non-pecuniary relief, requests for reinstatement or re-engagement, mediation or arbitration proceeding
  • Receipt of a formal notice of a criminal proceeding
  • Administrative or regulatory proceedings

EPL insurance is provided on a claims-made basis. This means that claims are only covered if they are made while the policy is in effect or within a contractually agreed extended reporting period, irrespective of when the event giving rise to the claim occurred.

What we do

We provide coverage to all employees who are acting under a contract of service or apprenticeships.

We have a very broad definition of Employment Practices Wrongful Act, which includes:

unfair or wrongful dismissal, wrongful failure to employ, unfair or wrongful discharge or termination of employment (including constructive dismissal), breach of any oral, written or implied employment contract, employment related misrepresentation, wrongful discrimination (including workplace harassment), violation of or non-compliance with working hours legislation, wrongful failure to promote, wrongful demotion, wrongful discipline, wrongful deprivation of a career opportunity, failure to grant tenure, negligent evaluation, invasion of employment related privacy, employment related defamation, failure to furnish accurate job references and employment related infliction of emotional distress to name but a few.......

Limits & Policy

Limits available up to GBP 2,000,000
Access to a dedicated legal helpline to assist with legal issues

Generous Additional Policy Benefits, including:

  • Third Party Liability as an optional coverage
  • Emergency Defence Costs

Feel free to contact us or pick up the phone to see how Plus Risk can assist you and your clients.

Claims Examples

Employee’s refusal to act in alleged breach of regulations

An employee’s responsibilities included monitoring compliance with electrical and machinery safety regulations. His company had a project to provide backup generators to a client, but the employee advised his manager that providing them without a required certificate would breach regulations. After being sacked on the grounds of poor communications and relations with colleagues and clients, he claimed he was unfairly dismissed for having blown the whistle on the company’s alleged wrongdoing

Unfair dismissal

A company faced a claim from a former employee who had been made redundant. The employee claimed he should not have been selected for redundancy as he had taken a salary sacrifice in the last year. The legal fees in successfully defending the case were more than £8,500.

Maternity pay claim

A bank employee went on maternity leave. After the end of the reference period for calculating her normal weekly earnings for the purposes of her maternity pay, but before her leave started, she received a pay rise. The rise was not reflected in her maternity pay calculation. She sued for sex discrimination contrary to the Equal Pay Act 1970 and for unauthorised deductions from wages contrary to the Employment Rights Act 1996. The proceedings were extremely expensive, reaching the Court of Appeal and also involving a reference of the calculation question to the European Court of Justice. The employee was successful.