Employment related lawsuits continue to rise. In 2010, the U.S. Equal Employment Opportunity Commission reported over 99,000 charges - the highest year yet!* And these statistics do not include the staggering number of claims filed with state and local agencies.
No organization is immune to an employment practices claim. A common misconception is that only larger companies have an exposure to employment related claims when in fact over 40% of claims are against firms with fewer than 100 employees. **The average jury award for an employment practices claim in 2008 was $326,000. Defense costs alone could cripple a small business.
Take steps to protect your firm. Implement an employee handbook if you don't have one. Your handbook should include policies and procedures that address items such as sexual harassment, discrimination, equal opportunity and disabled employees and accommodations. Additionally, use an employment application and conduct an annual written performance evaluation for every employee.
For financial protection, you can purchase Employment Practices Liability Insurance. Aside from the peace of mind you will receive, some companies offer valuable resources to help you make sure your firm is preventing these losses from occurring. For example, one well known EPL insurer offers the following free of charge to their customers:
Call-in help line for general questions to a national employment law firm
Interactive sexual harassment training for your employees
Sample employee handbooks which you can tailor to your firm
*www.eeoc.gov **According to Johnson & Johnson, Inc. ***According to Jury Verdict Research
Adam Pierce, AAI, is the Director of P&C Operations at Lawyers Insurance Agency. For more information, contact Adam at 800.662.8843 or firstname.lastname@example.org