Warning! Employment Dispute & Employment Practice Liability is not covered by Employers Liability Insurance.
A common misconception is that any allegation of employment malpractice will be covered by Employers Liability cover. Unfortunately not, Employers Liability will cover employees who sustain an injury or illness during their normal business activities and seek compensation. Whilst Employers Liability is a legal requirement, claims for discrimination, bullying in the workplace, sexual harassment and unfair dismissal would not be defended by this cover.
This cover can, however, be provided under an Employment Practice Liability section of a Directors and Officers or Management Liability Insurance Policy.
A Directors and Officers Insurance Policy is designed to protect the Directors, Officers, Partners and Management (and sometimes the company to the extent that it reimburses the individual) for any wrongful or alleged wrongful acts. This policy will cover the cost of defending the claim and any financial compensation award against the individual.
A director can be held personally liable for their actions or omissions in the performance of their company duties. Irrespective of a firms limited status, an individual in breach of their responsibilities can still be held personally liable with no limit in liability, which ultimately could lead to fines, compensation and even imprisonment!! Of course deliberate acts of wrongdoing are always excluded.
Why is EPL so important?
- Breaching Employment Law can be extremely costly not just in legal fees but also in the cost of fines, judgements and settlements for an array of violations.
- Employment tribunal cases have been on the increase in recent years notwithstanding out of court private settlements.
- Extensive range of employment legislation that must be adhered to such as age, religion and sexual discrimination.
- Reputation of company and individuals is at stake - why not benefit from reputation management and help manage and maintain your public image.
- Legal costs and compensation awards have increased in recent years with no cap on sex discrimination cases.
- In addition to business defence costs - employee costs are also included if a case is lost.
Contact us today on (01323) 410433 for a no obligation quotation on what is a very affordable cover.
By Thomas Whippy, Commercial Manager