Thursday, April 19, 2012

Must-Have Insurance for Lecherous Employers

Ex-Desperate Housewifes star, Nicole Sheridan, sued ABC for $6 million in damages for wrongful termination. This case has been going on for years and the restart button was hit again when her lawsuit recently ended in a mistrial. Her case will probably be retried, costing ABC far more in the end than $6 million. Whatever the outcome, nobody will win except the attorneys.

Your pockets may not be as deep as ABC’s, but you can make sure you will be able to afford the best legal protection against disgruntled employees with supplemental EPLI coverage. If you are a business owner; you need to know that your normal business property and liability policy does NOT cover employment practices liability (EPLI).

In fact, EPLI is a supplemental policy that only 25% of employers are smart enough to have. Allied Broker’s largest uncovered claim since 1954 was a client who did not follow our recommendation to buy this essential and affordable protection. One of the company’s managers was accused of sexual harassment by another employee. $700,000 in damages later, not including attorney’s fees, the executive who failed to take our advice was collecting unemployment- and probably plotting his own wrongful termination suit.

California is a pro-employee state. To sue an employer, employees needn’t even hire an attorney. All they have to do is file a claim with the state’s EEOP Department and the agency will defend them for nothing. You the business owner, on the other hand, must hire an attorney and even if you win, you will still be out $5,000-10,000 minimum- with no recourse to recover your costs.

The EEOP Department justifies its existence by dragging you and your attorney through the wringer. Employers are considered guilty until proven innocent. If the EEOP finds any reason to pursue the case against you, they will take you to the woodshed on the taxpayer’s dime, at no cost to the employee. If the EEOP lets you go, the employee is still free to hire an attorney to pursue a civil case against you. Then the fun really begins- “heads” the employee wins, “tails” you lose.

EPLI insurance is very reasonable. A $1 million liability policy that includes legal defense starts at under $2000 per year- a lot cheaper than losing your business to some made up (or real) claim by an ex-employee. You might be someone who would never intentionally do anything wrong, or you might be an unrepentant, backside-grabbing lech; either way you need to get EPLI coverage to protect your business. Call Allied Brokers today to learn more.

Visit our website at for information about all the types of insurance we offer. Or call 1-888-505-7988 for a free rate quote.

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