Discrimination / Sexual Harassment

Employment Practices Liability (EPL) is an insurance technical term for Discrimination and Sexual Harassment. This is an essential risk for business owners to handle. Learn more about elements of risk and sources that can help you as a business owner.
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Employment Practices Liability (EPL) is an insurance technical term for Discrimination and Sexual Harassment. This is often treated as an optional coverage by the insurance industry for business owners. From our experience working with business owners, you are more than 10 times more likely to have an EPL claim than a fire loss. Add in the recent spotlight on all forms of harassment especially sexual, does that sound like it should be an optional coverage?


There are several sources either online or in person that can help you:

    • A lawyer can provide legal advice.
    • An insurance professional should be able to help measure and mitigate risk.
    • A human resource professional (internal or external).


Three elements of risk that are less often considered but can lead to issues are:

    1. Hiring/Interview Process: Providing the same opportunity to apply for employment no matter who wants to do it is a key risk factor. Employment law starts with the application for employment not the first day at work. Without getting into all the legal aspects of what questions to have on the application, it is important that anyone that asks receives the same application process for the same position.
    2. Incident Reporting (especially who): Most of us would agree it is an important risk consideration to have a defined means to report a potential harassment incident. But in some cases it is more important to have considered who an employee would be comfortable with reporting a potential incident to. Directing 100% to their boss or the owner may keep some employees from reporting something early.  If there is another person in leadership that may garner a feeling of confidentiality and comfort to the employees, utilizing them should improve your risk. Shop size or employee count may prohibit this from occurring, but it is important to at least document that you considered it.
    3. Re-establish: On average, we renew car licenses every three years. Businesses that employ delivery drivers, get non-compete agreements resigned annually. Re-establishing on a periodic base your zero tolerance on sexual harassment and getting a signoff improves your EPL risk.


The business owner of the future needs to be good at attracting and retaining a talented team. It is much less expensive to hire and retain employees than to have to go find new ones. Part of retaining them is properly handling your EPL risk.

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