I include a discussion on e mployment practices liability as part of every diagnostic appointment I have with every business insurance client I meet with. I say the same thing, “Your employees are not your family and they are not friends, even if they are.” Unfortunately, for about seven out of 10 of them, the response I get in return sounds something similar to this, ”We're like a family here, we don't have to worry about things like that.”

My response is always, “That's great! Have you ever gotten upset and said or done something you regret to a family member?” Best friends, husbands and wives, fathers and sons, brothers and sisters break-up operating businesses every day because of disagreements over how things are done. If you don't believe me read the local newspaper or ask your local gossip.

These situations often get very nasty. An organization's dirty laundry is often used as leverage and information starts to surface that you might of otherwise been able to keep hidden… and the lawsuits start to fly.

Let me say this again… your employees are not your friends and they are not your family, even if they are. Your employees are your employees and you must take the necessary precautions to protect your business.

Employment Practices Liability
The example I used above was very specific and there is a good chance you cannot relate. If that's true try this on for size, whether you want to believe this or not, things happen at your business that you are not aware of.

Many employers are under the misconception that employment practices liability only covers discrimination. The truth is employment practices liability provides coverage for a bunch of crappy things that can take place within your organization, and in my professional opinion, it's as much a must have coverage as general liability.

Coverage is provided for but not limited to:

Discrimination: Disability, racial, religious, gender, age and all other protected classes
Sexual harrassment
Wrongful termination
Unsafe workplace

Many employment practices liability policies also cover wrongdoing by third parties. You hire a contractor to come into your office and update the kitchen. Over the course of a week of work he continually makes advances at your receptionist. When she denies his advances he goes psycho and begins to stalk her. She no longer feels comfortable or safe working in your office and files a lawsuit for emotional distress and lost wages from missed work.

What did you do? You just hired a contractor. But as the owner of a business with employees, you are responsible for every person that comes into your office.

It can be a scary world. Be prepared and be careful.

Special Reports /

nGInsights: Your Employees Are Not Your Friends

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