A Concern for Employers...

The Universal Concern for Employers

What concerns, as an employer, would you have if an employee were injured on the job? The ability to pay for the medical attention that is needed? The necessity in paying the employee a salary even if they are unable to work? What if a spouse of an employee sues your company for loss of consortium due to the injury? These are all things that an Employer could face if an employee is injured at work.

In SC, if you have 4 employees, you are REQUIRED by state law to carry Workers’ Compensation insurance. This insurance is intended to provide the employees financial compensation if injured on the job, as well as offers protection for the employer by ensuring that the they are able to provide employees with compensation in the event they are hurt.

Typically, if employers fail to purchase Workers’ Compensation insurance, they find that the fines they will incur because of this failure to obtain coverage, are actually the least of their concerns. Not only will the employer be responsible for an unlimited financial exposure and liability for an injured employee, but if an employee is permanently disabled and a death occurs, the employer could be facing a lawsuit to compensate the employee and their family for loss income, lifestyle change, loss of consortium, etc. Employers without Workers’ Compensation insurance, are putting themselves at serious risk as some businesses have been forced into bankruptcy due to the financial burden left behind after an employee was injured.

The risk of bankruptcy is far more than the premium of a Workers’ Compensation policy to make sure your company is protected in the event an employee is injured while working.

Is Your Company Protected From a Lawsuit?

Is Your Company Protected From a Lawsuit?

In many cases, today’s society is suing first, and asking questions later; and unfortunately, employers are not immune to employees suing the business. In fact, over the last 20 years, employee lawsuits have risen over 400%! Sadly, 41.5% percent of these lawsuits are affecting smaller companies with less than 100 employees.

According to the Equal Employment Opportunity Commission, statistics showed over 80% of these types of claims settle between $22,400-$40,500, which could be financially devastating to a small company. However, despite all of these alarming statistics, nearly 7 out of 10 businesses do not carry Employment Practices Liability Insurance (EPLI).

Employment Practices Liability Insurance is designed to protect an employer from employees suing for events such as wrongful termination, sexual harassment, discrimination, deprivation of career opportunity, breach of employment contract, etc. The U.S. Equal Employment Opportunity Commission stated that businesses paid out more than $404 million in one year for claims brought against the business for wrongful employment acts. Comparatively, the cost of an EPLI policy is a small portion of what the business will pay if you end up on the losing side of a lawsuit.

Unfortunately, according to a recent study, 60% of businesses that choose not to purchase an EPLI policy, mistakenly think they are protected under other policies. When thousands of dollars lie in the balance of a small business, make sure you are protected with Employment Practices Liability Insurance.