SilverLink - Spring/Summer 2008 - (Page 3)

RISK MANAGEMENT Human Capital Mitigate & Educate Preventing Employment Practices Liability Claims by Steve Narans & John Marshall Asking “leading” questions during a job interview…sexual harassment in the workplace… supervisors who “look the other way” on safety issues. It’s wrong and it could be illegal, but it happens nonetheless. In the past, employees were reluctant to complain about workplace issues, often from fear of retaliation, because those who complained were either targeted as troublemakers or were ﬁred. Today’s workers, however, are generally more knowledgeable than their predecessors regarding workplace rights and they are more likely to ﬁle Employment Practices Liability (EPL) claims against employers when they believe those rights have been infringed upon. EPL claims can affect any size or type of business. Typically, this type of claims exposure involves wrongful termination, unfair treatment, harassment or discrimination alleged by employees or third parties doing business with an organization. Often, these claims occur because a company leader or representative is not properly trained in the areas of leadership, management or day-to-day supervision. Employment Practices Liability Insurance (EPLI) coverage is available to help employers protect against this type of claim. Cost for EPLI coverage is determined by the size of the organization and/or the number of claims it has experienced. Potential buyers of this type of coverage typically take one of the following courses of action: • Coverage is purchased, but it may be inadequate if the limit is not high enough to cover potential exposures, the deductible is too high or the policy won’t cover some types of claims. Coverage is not purchased, often because the organization has had no claims in the past and the potential buyers do not believe this risk applies to them. Coverage is not purchased, but the employer ends up spending a considerable amount of money on attorney fees each time an employee-practices or termination issue arises. A Hidden Risk? Organizations face many risks, and often EPL takes a back seat to other, more compelling exposures. Be advised—employers shouldn’t leave Employment Practices Liability to chance. Because these are “people issues,” they are open to subjective, personal interpretation and they have the potential to cause both emotional and ﬁnancial pain to an organization. Positive interaction between management and workers is integral to the smooth operation of any business; disruption of that relationship can be the catalyst for EPL issues. That is why it is critical to have EPLI as part of your total coverage program. Reduce the Exposure Another key issue is the need to reduce liability exposure. Claims may arise from a variety of situations. Working to reduce exposure is one of the most productive steps an organization can take. For example, because managers can greatly impact the way workers view an organization, the manner in which a supervisor discharges his or her duties may inﬂuence the number of employment practices claims ﬁled by employees. It is imperative that those who supervise are given adequate training to enhance their people-management skills. Education is Key! To reduce or prevent EPL exposures, many organizations have found it helpful to offer seminars, classes or sensitivity sessions. Some timely topics include the following: • Behavioral Interviewing Techniques—Skillful interviewing can be the beginning of a successful work relationship. Laws govern how an interview can be handled (i.e., what types of information may or may not be requested). Standardized, nondiscriminatory interview practices are an effective means to reduce EPL risk. Communication of Expectations—New-employee orientation should consist of more than a tour of the facility. Knowing what is expected in both the speciﬁc job and the workplace in general—and receiving feedback during the • 3 SILVERLINK — SPRING / SUMMER 2008

Table of Contents Feed for the Digital Edition of SilverLink - Spring/Summer 2008

SilverLink - Spring/Summer 2008 Contents Risk Management: Mitigate & Educate Disastrous Distractions Accounts Receivable BoomerCare Risk Reduction, What’s Your Function? Time Out! Double Down Employee Benefits: Who’s Paying Whom for What? Time to Reconcile Keep Your Eye on the Pension Prize Show Me the Money Private Client Services: A Generous Strategy Is There Any Good News Left? Special Insurance for Special Times Client Spotlight: Omaha Performing Arts Internal Happenings: SilverStone Group Wellness Activities Group

SilverLink - Spring/Summer 2008

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