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Employment Practices Liability Insurance-By the Numbers
In today's growing litigious environment, employment practices claims against employers are on the rise. Employers face serious exposures in their day-to-day interactions with employees, and claims for sexual harassment, discrimination, wrongful termination, and other workplace torts are a serious threat that must be confronted by employers. The many costs associated with these types of claims can have a serious financial impact, even on large businesses.
There are three principal classes of legal action within the category of Employment Practices Liability: 1) Wrongful Termination -- the discharge of an employee for invalid reasons; 2) Discrimination -- denial of equal treatment for prejudicial reasons and; 3) Sexual Harassment -- Subjection of unwanted sexual advances, obscene or offensive remarks, lewd behavior and the failure to intervene and stop such behavior. The definitions of these principal classes are being expanded daily to include such things as failure to hire, failure to promote, retaliation, etc.
Research compiled by the Jury Verdict Research Series indicates that the average wrongful termination compensatory loss is $532,016; sexual harassment compensatory loss average $120,702 and work-related gender discrimination is averaging $501,622. These amounts do not include legal fees, which historically have ranged from $200,000 to $1 million per claim. Plus the cost of management's time, which can be extensive.
This data is compiled by the Office of Research, Information and Planning from EEOC's Charge Data System - quarterly reconciled Data Summary Reports, and the National Data Base.
* EEOC began enforcing the Americans with Disabilities Act on July 26,
1992.
The number for total charges reflects the number of individual charge
filings. Because individuals often file charges claiming multiple types
of discrimination, the number of total charges for any given fiscal year
will be less than the total of the eight types of discrimination listed.
last updated: May 16, 2001
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Diversified Risk Insurance Brokers
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