EPLI Presentation

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• EPLI Presentation
• NAPEO March 24th , 2009
• As a business owner, you dont have to do
  anything wrong. Someone just has to say you did.
• Therefore, our task here today is to educate you
  on the true magnitude of your employment
  exposures.

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• Employment Practices Liability
• Employment practices Liability Insurance coverage
  protects employers from claims made by employees
  alleging violations of tort law and/or various
  federal or state dealings with employment.
• While many losses are small, there are thousands
  of cases a year where large damage awards and
  settlements are made.
• Areas of Exposure for Employers
• Recruiting and hiring employees.
• Employee evaluations.
• Discipline and corrective action.
• Terminating employees.
• Employee and applicant testing (medical, drug
  alcohol, personality, aptitude, etc.)

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• Why Do I Need EPL Insurance?
• Private company Information
• Employment related lawsuits are common.
• About 1 in 4 private companies (24) have
  experienced and EPL related event within the last
  5 years.
• Frequency of lawsuits increases significantly as
  the number of employees increases.
• Percentage of companies experiencing an EPL
  charge or lawsuit in the past 5 years
• 44 for companies with 50 49 employees
• 66 for companies with 250 499 employees
• 80 for companies with 500 or more employees

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• Job discrimination claims
  rise to record levels
• In wake of recent layoffs, complaints for 2008 up
  15 percent
• Discrimination claims filed with the Equal
  Employment Opportunity Commission jumped 15
  percent in fiscal 2008 to 95,402 .
• The highest level since the agency opened in 1965
• It's possible we have yet to see the full impact
  of the recession on discrimination charge filings
  .
• Job bias cases may swell to more than 100,000 in
  the current fiscal year that began Oct. 1 due to
  ongoing mass layoffs and scant hiring, among
  other factors.
• Preliminary figures to be released by the EEOC
  show that claims of age discrimination saw the
  biggest jump last year, up 28.7 percent to
  24,582.
• Harsh economic conditions, the need by workers to
  justify or secure compensation for job loss and
  the frenzy to cut costs have created a volatile
  mix in the workplace.
• Unless people have the sophistication to deal
  with tough times and large layoffs, theres going
  to be problems.
• (Source MSNBC March 9, 2009)

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Category FY 2007
FY 2008 Percentage

Change

• Source Equal Employment Opportunity
  Commission(Complaints can be filed in multiple
  categories.)

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• Employment practices claims have been really
  coming into their own Instead of griping about
  the boss around the water cooler, more folks now
  do their complaining at the local EEOC office.
• Win or lose, each of these claims maturing past
  the initial filing costs someone money. The cost
  of defense alone now averages 125,000. The
  average jury award is 200,000, and employees win
  two of every three cases that make it to trial.
  And thats just the federal EEOCplenty of claims
  are brought at the state and local levels, which
  are notoriously employee-friendly.
• Its not a question of if youre sued, but when.
• A Chubb survey of private company executives
  indicated that one in three firms has experienced
  an EPL-related event in the past five years.
• Even if the employer is completely without fault,
  itll cost you a lot to prove it,
• Itll never happen to me. But given Americans
  never ending love affair with suing the pants off
  anyone within reach, do you want to take a
  chance?
• (Source Agent Broker Article 5/2/08)

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Courtesy Specialty Risk Management
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The U.S. Equal Employment Opportunity Commission
PRESS RELEASE3-9-09 BURGER KING TO PAY 85,000
FOR TEEN HARASSMENT EEOC Said 18-Year-Old
Employee Sexually Harassed by General
Manager ADVANCE AUTO PARTS SETTLES DISABILITY
BIAS SUIT WITH EEOC FOR 50,000 AND REMEDIAL
RELIEF Company Refused to Hire Man with Cerebral
Palsy for Sales Job, Federal Agency
Charged PRESS RELEASE3-4-09 SHOPPERS VINEYARD
TO PAY 60,000 TO SETTLE EEOC RACE DISCRIMINATION
LAWSUIT Clifton Store Unlawfully Fired Only
High-Level African American Manager, EEOC
Charged FITZHUGH FARM TO PAY 180,000 TO SETTLE
EEOC SEXUAL HARASSMENT AND RETALIATION
SUIT Federal Agency Charged Horse Farm Fired
Farmhand Who Complained About Sexual Harassment
Along With Two-Coworkers Who Were Her
Witnesses PRESS RELEASE2-25-09 ASHLAND, INC. /
VALVOLINE SUED BY EEOC FOR AGE DISCRIMINATION Agen
cy Says Manager Harassed and Fired Because of His
Age PRESS RELEASE2-18-09 GLACIER NORTHWEST TO
PAY 20,000 FOR VIOLATION OF THE FEDERAL EQUAL
PAY ACT EEOC Says Building Materials Supplier
Underpaid Women Due to Gender
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The U.S. Equal Employment Opportunity
Commission PRESS RELEASE2-17-09 ROBERTSON
SANITATION TO PAY 475,000 IN EEOC LAWSUIT
CHARGING IT FAILED TO HIRE FEMALE DRIVERS Trash
Removal Company Hired Less Qualified Males, EEOC
Charged PRESS RELEASE2-11-09 MURPHY FORD INC.
TO PAY 244,000 FOR SEX HARASSMENT AND
RETALIATION AGAINST FEMALE WORKERS EEOC Said Car
Dealership Fired Service Advisor for
Complaining PRESS RELEASE1-22-09 PITT OHIO
AGREES TO PAY 2.43 MILLION TO SETTLE EEOC
DISCRIMINATION LAWSUIT Trucking Company Refused
Class of Women Driver and Dockworker Jobs,
Federal Agency Charged PRESS RELEASE1-13-09 CHIC
AGO DENTIST TO PAY 462,500 TO SETTLE EEOC
HARASSMENT AND RETALIATION LAWSUIT Orrington Firm
Subjected Employees to Sexual Advances and
Scientology Indoctrination and Fired Those Who
Complained, Federal Agency Charged PRESS
RELEASE12-31-08 MERRILL LYNCH TO PAY 1.55
MILLION FOR JOB BIAS AGAINST IRANIAN MUSLIM
FORMER EMPLOYEE EEOC Settles Suit for
Discrimination Based on Religion and National
Origin PRESS RELEASE6-2-08 TAVERN ON THE GREEN
TO PAY 2.2 MILLION FOR HARASSMENT OF FEMALES,
BLACKS, HISPANICS EEOC Settles Job
Discrimination Suit with Landmark NYC Restaurant