Employment practices liability

Last updated

Employment practices liability is an area of United States labor law that deals with wrongful termination, sexual harassment, discrimination, invasion of privacy, false imprisonment, breach of contract, emotional distress, and wage and hour law violations. It may be categorized as a form of professional liability. Employment practices liability insurance (EPL) is sold as a type of management liability insurance, [1] which is related to professional liability insurance.

Most commonly, employment practices liability deals with laws and protections brought under Title VII of the Civil Rights Act of 1964, the ADA (Americans with Disabilities Act) of 1990, the Civil Rights Act of 1991, ADEA (Age Discrimination in Employment Act) of 1967, and Family and Medical Leave Act (FMLA). [2] [3] The Equal Employment Opportunity Commission (EEOC) interprets and enforces these laws.

The EEOC recognizes eleven types of employment practices discrimination: age, disability, equal pay/compensation, genetic information, national origin, pregnancy, race/color, religion, retaliation, sex, and sexual harassment. [4]

Analysis of annual claims totals suggests that EPL claims rates correspond to unemployment rates: [5] from 2007 to 2008, total claims in the U.S. jumped 13% [6] as mass layoffs increased by roughly a third. [7] In 2012, charges of retaliation, race, and sex discrimination (including harassment and pregnancy) were the most common types of discrimination that prompted EPL filings. [8]

EPL insurance

A growing product on the insurance markets is employment practices liability insurance (EPL), a type of policy that business owners can buy to protect their organizations against employee suits for rights protected under acts above. [9] More recently, with the expansion of privacy law(s), employee privacy concerns have come to the fore as private employee data is stored electronically. This is not always covered under an EPL policy, but the insurance industry has responded by offering cyber liability and network security policies.

Importantly, there are both federal and state statutes that govern an employer's liability to its employees. Laws also differ from state to state; e.g., California, is often considered a pro-employee state when it comes to employers' liability.

Like most kinds of professional liability insurance, EPL insurance policies operate on a claims-made basis. [10] This means that policyholders can only receive insurance benefits if they are covered both at the time of the discrimination incident that triggered the claim and at the time when the claim is filed. [11]

Related Research Articles

In United States labor law, a hostile work environment exists when one's behavior within a workplace creates an environment that is difficult or uncomfortable for another person to work in, due to illegal discrimination. Common complaints in sexual harassment lawsuits include fondling, suggestive remarks, sexually-suggestive photos displayed in the workplace, use of sexual language, or off-color jokes. Small matters, annoyances, and isolated incidents are usually not considered to be statutory violations of the discrimination laws. For a violation to impose liability, the conduct must create a work environment that would be intimidating, hostile, or offensive to a reasonable person. An employer can be held liable for failing to prevent these workplace conditions, unless it can prove that it attempted to prevent the harassment and that the employee failed to take advantage of existing harassment counter-measures or tools provided by the employer.

<span class="mw-page-title-main">Sexual harassment</span> Unwanted sexual attention or advances

Sexual harassment is a type of harassment involving the use of explicit or implicit sexual overtones, including the unwelcome and inappropriate promises of rewards in exchange for sexual favors. Sexual harassment includes a range of actions from verbal transgressions to sexual abuse or assault. Harassment can occur in many different social settings such as the workplace, the home, school, or religious institutions. Harassers or victims may be of any sex or gender.

In United States labor law, at-will employment is an employer's ability to dismiss an employee for any reason, and without warning, as long as the reason is not illegal. When an employee is acknowledged as being hired "at will", courts deny the employee any claim for loss resulting from the dismissal. The rule is justified by its proponents on the basis that an employee may be similarly entitled to leave their job without reason or warning. The practice is seen as unjust by those who view the employment relationship as characterized by inequality of bargaining power.

<span class="mw-page-title-main">Equal Employment Opportunity Commission</span> United States government agency enforcing civil rights laws against workplace discrimination

The U.S. Equal Employment Opportunity Commission (EEOC) is a federal agency that was established via the Civil Rights Act of 1964 to administer and enforce civil rights laws against workplace discrimination. The EEOC investigates discrimination complaints based on an individual's race, color, national origin, religion, sex, age, disability, genetic information, and retaliation for participating in a discrimination complaint proceeding and/or opposing a discriminatory practice.

An employment contract or contract of employment is a kind of contract used in labour law to attribute rights and responsibilities between parties to a bargain. The contract is between an "employee" and an "employer". It has arisen out of the old master-servant law, used before the 20th century. Employment contracts relies on the concept of authority, in which the employee agrees to accept the authority of the employer and in exchange, the employer agrees to pay the employee a stated wage.

<span class="mw-page-title-main">United States labor law</span> US laws on fair pay and conditions, unions, democracy, equality and security at work

United States labor law sets the rights and duties for employees, labor unions, and employers in the United States. Labor law's basic aim is to remedy the "inequality of bargaining power" between employees and employers, especially employers "organized in the corporate or other forms of ownership association". Over the 20th century, federal law created minimum social and economic rights, and encouraged state laws to go beyond the minimum to favor employees. The Fair Labor Standards Act of 1938 requires a federal minimum wage, currently $7.25 but higher in 29 states and D.C., and discourages working weeks over 40 hours through time-and-a-half overtime pay. There are no federal laws, and few state laws, requiring paid holidays or paid family leave. The Family and Medical Leave Act of 1993 creates a limited right to 12 weeks of unpaid leave in larger employers. There is no automatic right to an occupational pension beyond federally guaranteed Social Security, but the Employee Retirement Income Security Act of 1974 requires standards of prudent management and good governance if employers agree to provide pensions, health plans or other benefits. The Occupational Safety and Health Act of 1970 requires employees have a safe system of work.

<span class="mw-page-title-main">Age Discrimination in Employment Act of 1967</span> United States labor law

The Age Discrimination in Employment Act of 1967 is a United States labor law that forbids employment discrimination against anyone, at least 40 years of age, in the United States. In 1967, the bill was signed into law by President Lyndon B. Johnson. The ADEA prevents age discrimination and provides equal employment opportunity under the conditions that were not explicitly covered in Title VII of the Civil Rights Act of 1964. The act also applies to the standards for pensions and benefits provided by employers, and requires that information concerning the needs of older workers be provided to the general public.

An employee handbook, sometimes also known as an employee manual, staff handbook, or company policy manual, is a book given to employees by an employer.

Disparate impact in United States labor law refers to practices in employment, housing, and other areas that adversely affect one group of people of a protected characteristic more than another, even though rules applied by employers or landlords are formally neutral. Although the protected classes vary by statute, most federal civil rights laws consider race, color, religion, national origin, and sex to be protected characteristics, and some laws include disability status and other traits as well.

<span class="mw-page-title-main">Equal employment opportunity</span> Protection of US employees from types of employment discrimination

Equal employment opportunity is equal opportunity to attain or maintain employment in a company, organization, or other institution. Examples of legislation to foster it or to protect it from eroding include the U.S. Equal Employment Opportunity Commission, which was established by Title VII of the Civil Rights Act of 1964 to assist in the protection of United States employees from discrimination. The law was the first federal law designed to protect most US employees from employment discrimination based on that employee's race, color, religion, sex, or national origin.

Employment discrimination law in the United States derives from the common law, and is codified in numerous state, federal, and local laws. These laws prohibit discrimination based on certain characteristics or "protected categories." The United States Constitution also prohibits discrimination by federal and state governments against their public employees. Discrimination in the private sector is not directly constrained by the Constitution, but has become subject to a growing body of federal and state law, including the Title VII of the Civil Rights Act of 1964. Federal law prohibits discrimination in a number of areas, including recruiting, hiring, job evaluations, promotion policies, training, compensation and disciplinary action. State laws often extend protection to additional categories or employers.

The California Fair Employment and Housing Act of 1959, codified as Government Code §§12900 - 12996, is a California statute used to fight sexual harassment and other forms of unlawful discrimination in employment and housing, which was passed on September 18, 1959.

A workplace is a location where someone works, for their employer or themselves, a place of employment. Such a place can range from a home office to a large office building or factory. For industrialized societies, the workplace is one of the most important social spaces other than the home, constituting "a central concept for several entities: the worker and [their] family, the employing organization, the customers of the organization, and the society as a whole". The development of new communication technologies has led to the development of the virtual workplace and remote work.

Crawford v. Nashville, 555 U.S. 271 (2009), is a United States Supreme Court case in which the Court unanimously ruled that Title VII of the Civil Rights Act of 1964 protects an employee who opposes unlawful sexual harassment, but does not report the harassment themself.

Robinson v. Shell Oil Company, 519 U.S. 337 (1997), is US labor law case in the United States Supreme Court in which the Court unanimously held that under federal law, U.S. employers must not engage in workplace discrimination such as writing bad job references, or otherwise retaliating against former employees as a punishment for filing job discrimination complaints.

<span class="mw-page-title-main">Paycheck Fairness Act</span> Proposed law to address the gender pay gap

The Paycheck Fairness Act is a proposed United States labor law that would add procedural protections to the Equal Pay Act of 1963 and the Fair Labor Standards Act as part of an effort to address the gender pay gap in the United States. A Census Bureau report published in 2008 stated that women's median annual earnings were 77.5% of men's earnings. Recently this has narrowed, as by 2018, this was estimated to have decreased to women earning 80-85% of men's earnings. One study suggests that when the data is controlled for certain variables, the residual gap is around 5-7%; the same study concludes that the residual is because "hours of work in many occupations are worth more when given at particular moments and when the hours are more continuous. That is, in many occupations, earnings have a nonlinear relationship with respect to hours."

<span class="mw-page-title-main">LGBT employment discrimination in the United States</span>

LGBT employment discrimination in the United States is illegal under Title VII of the Civil Rights Act of 1964; employment discrimination on the basis of sexual orientation or gender identity is encompassed by the law's prohibition of employment discrimination on the basis of sex. Prior to the landmark cases Bostock v. Clayton County, Georgia and R.G. & G.R. Harris Funeral Homes Inc. v. Equal Employment Opportunity Commission (2020), employment protections for LGBT people were patchwork; several states and localities explicitly prohibit harassment and bias in employment decisions on the basis of sexual orientation and/or gender identity, although some only cover public employees. Prior to the Bostock decision, the Equal Employment Opportunity Commission (EEOC) interpreted Title VII to cover LGBT employees; the EEOC determined that transgender employees were protected under Title VII in 2012, and extended the protection to encompass sexual orientation in 2015.

In law, wrongful dismissal, also called wrongful termination or wrongful discharge, is a situation in which an employee's contract of employment has been terminated by the employer, where the termination breaches one or more terms of the contract of employment, or a statute provision or rule in employment law. Laws governing wrongful dismissal vary according to the terms of the employment contract, as well as under the laws and public policies of the jurisdiction.

Sexual harassment in the workplace in US labor law has been considered a form of discrimination on the basis of sex in the United States since the mid-1970s. There are two forms of sexual harassment recognized by United States law: quid pro quo sexual harassment and behavior that creates a hostile work environment. It has been noted that a number of the early sexual harassment cases were brought by African American women and girls.

<span class="mw-page-title-main">Victoria Lipnic</span> American lawyer

Victoria Ann Lipnic is an American lawyer and public figure. She served in multiple senior United States government positions. She was Commissioner of the U.S. Equal Employment Opportunity Commission (EEOC), nominated to two terms by President Barack Obama, 2010 – 2020.) She served as Chair (Acting) of the EEOC under President Donald J. Trump from 2017 – 2019. Prior to her appointments to the EEOC, she was Assistant Secretary of Labor under President George W. Bush. The United States Senate confirmed her unanimously to each of these positions.

References

  1. ↑ "Management Liability Insurance | Insurance Glossary Definition | IRMI.com". www.irmi.com. Archived from the original on 2018-11-24. Retrieved 2018-11-24.
  2. ↑ "Wage and Hour Division (WHD)". United States Department of Labor. Retrieved 9 December 2014.
  3. ↑ http://www.property-casualty.com/Issues/2010/June-1421-2010/Pages/EPL-Insurers-Still-Avoid-WageHour-Coverage-Grants-For-Large-Employers.aspx Archived 2010-06-23 at the Wayback Machine |EPL Insurers Still Avoid Wage-&-Hour Coverage Grants For Large Employers
  4. ↑ "Discrimination by Type". U.S. Equal Employment Opportunity Commission. Retrieved 9 December 2014.
  5. ↑ "Tough Economy Fuels Rise in Employment Liability". CreditUnionMagazine.com. Retrieved 2013-08-15.
  6. ↑ "No Surprises! High Unemployment Makes the Case for EPLI". PropertyCasualty360. Retrieved 2013-08-15.
  7. ↑ "Mass layoffs jump by one-third in 2008 – Jan. 28, 2009". CNNMoney.com. Retrieved 2013-08-15.
  8. ↑ "EEOC Reports Nearly 100,000 Job Bias Charges in Fiscal Year 2012". U.S. Equal Employment Opportunity Commission. Retrieved 2013-08-15.
  9. ↑ "Employment Practices Liability Insurance (EPLI)". Executive Perils. Retrieved 9 December 2014.
  10. ↑ "The Ins and Outs of Claims-Made Policies". Insurance Journal. 2 October 2005. Retrieved 2013-08-15.
  11. ↑ "What Is a Claims-Made Insurance Policy?". insureon.com. Retrieved 2022-11-17.


This page is based on this Wikipedia article
Text is available under the CC BY-SA 4.0 license; additional terms may apply.
Images, videos and audio are available under their respective licenses.