Do you think you don't need an Employment Practices Liability Insurance Policy (EPLI)? Or, perhaps you decided the budget was too tight this year and went bare? In either case, you may be in trouble!

Many state and federal laws changed in 2008 that should cause you should think twice about EPLI before going bare.

Americans with Disabilities Act Amendment

Signed into law on September 25, 2008 (and effective January 1, 2009) the Americans with Disabilities Act Amendment Act of 2008 (ADAAA) changed disability law nationwide.

California has the most cumbersome ADA regulations in the country. With the 2008 Amendment, the California standard has been surpassed.

The new law amends the current one as follows:

New definition of "Disability" expands to individuals with far less severe impairments - lowers the bar for qualifying as disabled & now includes "activities that are of central importance to most people's everyday life activities":
- Walking, standing, lifting, communicating, working, etc.
- Bodily functions - normal cell growth, digestive, bowel, respiratory, etc.

· Individual may now be "regarded as" disabled merely by showing he or she has been subjected to any adverse action because of an actual or perceived physical or mental impairment, even if it doesn't limit a major life activity (major life activity previously required)

NEW PROTECTION! Those individuals who are able to control their impairment by medication or medical devices may now qualify for protection.

Family and Medical Leave Act Amendments

In January 2008, amendments to the Family and Medical Leave Act (FMLA) provided new military leave entitlements as well as updated the regulations under the 15-year old plan. The Department of Labor published its final rule (700 pages) on these new amendments on November 17, 2008. Some of the revisions, which go into effect January 16, 2009, include:

Clarification of a serious health condition
Intermittent Leave: Employees who take intermittent leave have a statutory obligation to make a "reasonable effort" to schedule such leave so as not to unduly disrupt the employer's operations.
Light Duty: Time spent in "light duty" work does not count against an employee's FMLA leave entitlement, and the employee's right to job restoration is held in absence during the light duty period, unless the employee is voluntarily doing light duty work, then he or she is not on FMLA leave.
Gaps in Service: Although the 12 months of employment need not be consecutive, employment prior to a continuous break in service of seven (7) years or more need not be counted.
Plus many others!

Military Leave (USERRA)

As with most employment law issues, one employee situation may often fall under multiple causes of action. The ADA and FMLA laws often intertwine in many ways, and now USERRA changes impact employment law even more. If an employee is deployed, whether a full deployment or as part of or National Guard duties, the employer is required to hold their position open during active duty for a cumulative period of up to five years. Replacements can be hired, but only as temporary employees. In addition, if an employee is injured while on military leave, he may be considered disabled under USERRA, even if he's not considered disabled under ADA statutes.

For returning employees, USERRA removes the "employment at will" status for a period of six months to one year, depending on the length of service.

Now more than ever employers need to have EPLI coverage!

The Cost of a Claim is High

Let's talk about the cost of a claim. Defense alone for an EPLI claim can climb up to $75,000 (to file for Motion for Summary Judgment) before reaching a courtroom. If a case does go to trial, defense costs can reach a minimum of $200,000, which does not include jury awards if the employer loses and those can vary greatly depending on the cause of action(s).

Plaintiffs win 50-68% of the time.

Your chance of winning is..."less than a flip of a coin."

Those aren't very good odds when you consider the amount of time and money involved in defending a claim.

Aside from defense costs, jury awards or settlements, other factors to consider include the amount of time and resources invested when defending a claim. It can be as long as two years from the time a claim is filed until a settlement or a court decision is made.

Does you really want to go through this alone?

The Answer

David Cook Insurance Agency and Farmers Insurance Group offers one the broadest EPLI policies available, supported by a dedicated detail-oriented claims department, experienced EPL panel attorneys and the Human Resources Specialists of Specialty Risk Management, Inc.

In today's unsteady economic climate, companies need comprehensive coverage, not limited endorsements. Our policy offers coverages very few carriers even consider.

David Cook Insurance Services

A Member of Farmers Insurance Group

For an application please contact:

David Cook - (951) 685-9990 Ext 10

[email protected]

Not intended to be a representation of coverage or a guarantee of a quote or indication. See policy wording for coverage details.