Employment Practices Liability Insurance in Massachusetts

What is Employment PRactices Liability Insurance?

When you’re interviewing new candidates, deciding on promotions, and taking on the unfortunate task of disciplining or firing employees, you try to make the best decisions for your business. However, at times your actions may be seen as discriminatory or unfair. If an employee feels you have violated their legal rights, you may find yourself in the Massachusetts courts facing a lawsuit. You can better protect your business with employment practices liability insurance.

Is Your Business Protected?
All employees deserve to be treated fairly and equally. To help protect workers, Massachusetts and the U.S. government have enacted laws that must be upheld. Among these are anti-discrimination statutes, the Civil Rights Act, the Americans with Disabilities Act, and the Family Medical Leave Act. It is imperative that all managers understand and abide by these laws, but lawsuits may still happen. Employment practices liability insurance can help cover the financial ramifications of this situation.

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What Does Employment Practices Liability Insurance Cover?

Employees can sue your business for a number of transgressions or perceived wrongs. If you are found guilty of not complying with the laws set forth by the federal or Massachusetts governments, you may be facing fines and penalties in addition to paying damages. Many such cases involve one or more of the following charges:

• Sexual harassment
• Discrimination based on race, gender, age, or other factors
• Wrongful termination
• Breach of contract
• Emotional distress
• Libel
• Slander
• Mismanagement of employee benefits
• Negligence

These lawsuits are often very expensive, even if you are ultimately cleared of wrongdoing. If you are sued for one of these reasons, your policy can be used to help cover your legal defense, court costs, and settlements, dramatically reducing the financial costs to your business stemming from these charges.

Additional Coverages

Experts recommend that all businesses with paid staff invest in employment practices insurance to protect themselves in today’s litigious society. Even small businesses can be the target of large lawsuits if a company member or potential employee feels you have violated their legal rights. The amount of coverage you need depends on the size and history of your company. Many policies cover between $1 million and $25 million to provide protection from lawsuits concerning your employees.

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Lawsuits against employers have been increasing in recent years. It’s important to protect your Massachusetts business by making sure all employees and managers are aware of the legal statutes protecting workers and that they remain in compliance at all times. You should also ask your agent about this type of coverage to purchase protection against any lawsuits that may arise in relation to your employment decisions.

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