Dispatch #48 - Why Employment Practices Insurance is Worth Another Look

I hesitate to suggest adding overhead at a time like this, but on balance I prefer that the contractors I work with have Employment Practices Liability Insurance (EPLI). If they don’t carry it, I recommend they look into it.

From the International Risk Management Institute:

Employment Practices Liability Insurance (EPLI) — a type of liability insurance covering wrongful acts arising from the employment process. The most frequent types of claims covered under such policies include: wrongful termination, discrimination, sexual harassment, and retaliation. 

The premiums are usually affordable relative to the potentially large cost of an employee claim, the risk of which is higher in this COVID-19 work environment. Compared to a few months ago, contractors today face a slew of new human resource situations, challenges, rules, and regulations.

• Can we force a field crew member to get tested and share the results with you? How do we balance job site safety and contact tracing requirements with an employee’s right to medical privacy?

• What if an employee is afraid he or she will get sick and resists returning to the office? On what grounds can we require in-office attendance versus remote work? How do we confirm an employee is eligible for COVID-19 related paid sick or Family and Medical Leave Act pay?

• Never mind COVID, what about basic wage and hour issues like lunch breaks and overtime being recorded improperly on timecards?

In the hands of an aggressive employment attorney, unintentional mistakes made by well-meaning contractors can turn into expensive employment claim nightmares.

For more information, ask your HR advisor and your insurance broker.

Need help with this or other financial matters faced by construction contractors? Let’s talk!

David Stern CFO makes every effort to provide useful and accurate information. This content, however, is not intended as a substitute for specific business-related financial advice. We disclaim all warranties and liabilities from its use.