Tag Archives: epli coverage

Four Reasons Why Every Small Business Needs EPLI Coverage In 2018

Most small business owners do not understand why they need EPLI coverage in 2018. EPLI stands for employment practices liability insurance. It protects your company from potential employee lawsuits. In today’s work environment, your company is more likely to be sued by an employee than be damaged in a natural disaster. Indeed, employee lawsuits have become one of the most common disasters for small business owners in the United States.

Understanding EPLI Coverage in 2018

epli coverage in 2018

EPLI Coverage in 2018

As a professional employer organization (PEO), Total HR Management has tailored service offerings that include EPLI insurance. Beyond a standard business owner’s policy, an EPLI policy is the additional armor that small businesses need to protect themselves in the 21st century.

EPLI can cover legal defense costs in the event of an employee lawsuit. If you need to pay an employee settlement, EPLI can ensure that such a negative judgment does not bankrupt your business.

If you are still unsure about whether you need EPLI coverage in 2018 as a small business owner, let us highlight four reasons why every small business owner should have such protection:

First Reason – More Employee Lawsuits in the 21st Century

American employees are quicker to file lawsuits today than they ever have been in the past. Even if this trend is seen by many labor experts as a natural step toward better checks and balances, it is still a threat to your company. For business owners, the rising number of employee lawsuits means that EPLI coverage in 2018 is a necessity for your business.

In 2016 alone, 91,503 charges of workplace discrimination were filed with the EEOC. This is a major increase over the number of lawsuits filed the year before. In total, 2016 cases resulted in penalties and awards that totaled to more than $480 million in damages. Do you want your company to be a casualty of such financial devastation?

Second Reason – Small Businesses Targeted by Employees.

Most small business owners believe that employee lawsuits are almost always aimed at major corporations with deep pockets. However, in practice, nothing could be further from the truth.  More than four in ten employment lawsuits (41 percent) are filed against companies with fewer than 100 employees. Moreover, small and medium-sized companies in the United States (under 500 employees) have an almost 12% chance of facing an employment lawsuit claim in any given year.

Third Reason – Owners Liable for the Actions of Managers.

Most business owners succeed because they know how to run a company well and connect with their employees. However, are your managers and executives as good as you are when it comes to working with employees? Many state laws hold business owners liable for discriminatory behavior committed by managers. If an employee can prove their case against one of your managers, then you automatically become liable as well. Such an outcome is an employee lawsuit nightmare for most business owners. In such cases, EPLI coverage in 2018 can protect your company.

Fourth Reason – Employee Lawsuits Cost a Lot of Money

Employee lawsuits are expensive, regardless of the outcome. The New York Times has told the tough story of a California business owner who was sued not once or twice, but three times by employees that were claiming a variety of problems in the workplace. Each case was defended and proven to be spurious. Still, the cost of defending and settling a claim, either in court or out of court, can be anywhere from the low five figures to the high six figures and beyond. Trial cases tend to cost twice as much as settlements, even if the case is thrown out of court. As a result, EPLI coverage in 2018 is a necessity.

Total HR Management Can Help

To learn more about EPLI coverage options from Total HR Management, take the first step today. Please call (800) 975-5128 to learn more about how we can help you protect your company moving forward.


No Legal Advice Intended: This blog includes information about legal issues and legal questions. Such materials are for informational purposes only and may not reflect the most current legal developments. These informational materials are not intended, and should not be taken, as legal advice on any particular set of facts or circumstances. You must not rely on the information on this website as an alternative to legal advice from your attorney or another professional legal services provider.


How A PEO Helps With EPLI Coverage And The Challenge Of Ongoing Compliance

Do you know how a professional employer organization can help your company with EPLI coverage and the challenge of ongoing compliance? Commonly referred to as EPLI coverage, Employment Practices Liability Insurance is additional insurance coverage a company can use to protect the business from lawsuits brought on by a former, current or even future employee. As part of our compliance series where we detail such challenges, Total HR Management demonstrates why your company should work with a PEO.

Importance of EPLI Coverage

In a time when entitled employees are looking for reasons to file lawsuits, EPLI Coverage is more important than ever. It allows you to sleep at night, knowing your company is safe. Total HR Management has seen several successful businesses damaged beyond repair when employee lawsuits came without the safety net of EPLI coverage. The goal of effective human resources management is to avoid such unnecessary damage.

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Three Internal Strategies To Address Potential FCA Whistleblower Lawsuits And Boost EPLI Coverage

FCA whistleblower lawsuits have become a problem across the country. In light of the growing number of False Claims Act (“FCA”) suits brought by qui tam FCA whistleblowers in 2014, it’s important for a company to have internal strategies to address potential lawsuits and boost EPLI Coverage. In 2014, more than 700 FCA whistleblower suits were filed in the United States. The Department of Justice (“DOJ”) recovered over $5 billion from target businesses in qui tam litigation.

FCA Whistleblower Lawsuits

fca whistleblower

FCA Whistleblower Lawsuits

More importantly, the “original source” precedent holding that whistleblowers must play a direct role in public disclosures in order to file suit has been abandoned. The legal precedents that once discouraged whistleblowers to file lawsuits have been reversed by a decision by the 9th circuit court. As a result, many shark-in-the-water lawyers are now encouraging employees to file such lawsuits. The floodgates have opened for more whistleblower lawsuits to be filed.

Such qui tam suits are a real danger to many mid-sized companies, particularly if they file claims with the government for payment of money. Qui tam is an abbreviation from the Latin phrase meaning, “who as well for the king as for himself sues in this matter.” Qui tam cases are different from other types of lawsuits that involve a personal stake. In qui tam lawsuits like whistleblower cases, the person bringing the lawsuit is not the one who has been harmed.

False Claims Act Challenges

This intensifying storm of FCA litigation is reason for concern to any business that files claims with the government for payment of money. By choosing to accept money from the government, a business exposes itself to potential FCA liability. With this growing risk of claims brought under the FCA’s whistleblower provisions, the stakes of losing FCA litigation are significant.

Faced with ever-increasing liability, insurance carriers are now desperately trying to close the floodgates by denying FCA insurance recovery claims. Policyholders who fail to recognize insurance company denial tactics can make the mistake of failing to believe they are covered. Luckily, by working with a professional employer organization, you can avoid such problems.

EPLI Coverage

With the EPLI coverage provided by Total HR Management, such coverage is provided. It is even more essential is to develop internal strategies within your company to avoid FCA whistleblower lawsuits.

Three Internal Strategies To Address Potential FCA Whistleblower Lawsuits:

  1. Proceed with the understanding that FCA whistleblower claims are covered.

If you work with a professional employer organization, proceed with the understanding that FCA claims are covered. In order to gain such confidence, discuss the issue with your HR manager.

  1. Implement appropriate internal procedures to flag and address qui tam-related events.

Government inquiries often arise in the course of whistleblower litigation. Evidence of such an investigation may be a very informal or seemingly run-of-the-mill request for information. Such inquiries, no matter how routine, flag an immediate need to evaluate insurance. The best time to devote legal resources to FCA insurance issues is at this early stage.

Companies should analyze the implications of complex and often contradictory notice obligations. Companies cannot conduct such a review, however, unless qui tam related inquiries are directed to appropriate personnel. To do this, policies and procedures should be put in place for employees at all company levels to identify and report qui tam-related events.

  1. Conduct annual review of policies for qui tam and FCA coverage.

A company should assess and develop a working qui tam internal strategy long before it is faced with a qui tam claim. Policies should include provisions that accommodate the unique aspects of qui tam claims, such as the fact that whistleblower lawsuits can be filed under seal, and a policyholder may not learn that a lawsuit has even been filed for several years.

To learn more about EPLI coverage for your business and FCA whistleblower lawsuit protection, contact the human resources managers and professionals at Total HR Management by calling (800) 975-5128 today.


No Legal Advice Intended: This blog includes information about legal issues and legal questions. Such materials are for informational purposes only and may not reflect the most current legal developments. These informational materials are not intended, and should not be taken, as legal advice on any particular set of facts or circumstances. You must not rely on the information on this website as an alternative to legal advice from your attorney or other professional legal services provider.

EPLI Service Providers Mark A Recent Flood Of FCRA Background Check Class Action Lawsuits

As a provider of a shared liability solution for our client companies, Total HR Management keeps up to date by marking trends in EPLI lawsuits and class action cases. Recently, there has been a flood of FCRA background check class action lawsuits across the country. The class action lawsuits allege technical violations of the Fair Credit Reporting Act (FCRA) by businesses that conduct background checks on prospective employees.

FCRA Background Check Lawsuit

fcra background check, epli

FCRA Background Check

Even with EPLI coverage, a goal is to avoid ever entering into a legal imbroglio with an employee. James Harwood, the founder and CEO of Total HR, has pointed out how his human resources outsourcing company is, “a strategic partner that works to give our clients peace of mind every single day.” EPLI coverage is a major ingredient of that peace of mind, but the coverage alone needs to be supported with quality information and resources.

Although commercial general liability insurers have already established effective defenses against these FCRA claims, they can still damage a business. FCRA background check lawsuits tend to focus on the FCRA requirement that employers provide prospective employees with a clear and conspicuous disclosure that a consumer report may be used as part of a routine background check. The disclosure cannot be buried in the employment papers, but needs to actually be highlighted as a stand-alone statement.

Class Action Lawsuit Against Employers

In the majority of cases, the lawsuits have alleged that the “clear and conspicuous” requirement was not satisfied due to extraneous information on the disclosure form. Furthering this legal point, the class action lawsuits claim the requisite disclosure did not take the form of a stand-alone document. When litigating willful violations of the Fair Credit Reporting Act, courts across the country have tended to focus on such alleged technical violations of the statute.

Due to the available statutory damages of $1,000 per class member and the lack of a cap on the recovery of statutory damages, plaintiff class action attorneys see FCRA claims as a goldmine. Past multimillion dollar settlements have fostered a strong incentive for plaintiff class action attorneys. As a result, there is no reason for the flood of FCRA lawsuits to stop being a problem any time soon.

Definitive Need For EPLI Coverage & Protection

In light of this information, Total HR Management helps our client companies by offering to provide the FCRA disclosure forms needed in advance. If a FCRA background check is going to be used, such steps need to be immediately taken to avoid being swept up by the flood of class action lawsuits. Even with EPLI coverage, there is never any reason for a company to experience such a legal vulnerability when it can be effectively avoided.

Triumvirate Of Pasadena Leaders Reveal Multi-Dimensional Asset Protection At The Business Growth Workshop

At the latest Business Growth Workshop on June 23rd at the University Club of Pasadena, a rare triumvirate of business leaders revealed a multi-dimensional asset protection approach. Focusing on people, product and finances, Diana Peterson-More, Blake Longo and Alan Harrison each disclosed their expert perspectives on a bevy of challenges facing companies in the 21st century. While attempting to cover a tremendous amount of ground, they did manage to uncover several choice pieces of valuable information for the local entrepreneurs gathered that morning.

3 Approaches To Asset Protection

asset protection

Blake Longo, James Harwood, Diana Peterson-More, Alan Harrison

After being introduced by James Harwood of Total HR Management, the three business leaders provided a dynamic presentation where they each offered varying perspectives on a variety of challenging issues. From employee management and retirement plans to government compliance and document retention, the presentation revealed the numerous pitfalls facing companies in the modern world. Beyond federal regulations, all three presenters pointed out the difficulty of doing business in California where the state regulations and regulatory bodies offer complex difficulties as well.

As Alan Harrison pointed out from his experience working with numerous businesses, “Trying to comply with government regulation and regulatory compliance for many companies is often like trying to put a square peg into a round hole. It just doesn’t fit.” Given such challenges, the support of a professional employer organization can be a positive step in the right direction. From regulatory compliance to benefits administration, a local PEO can provide a company with the expertise that they lack.

EPLI Coverage Is Essential

asset protection

The Triumvirate at the Business Growth Workshop

Given the new challenges of both the Affordable Care Act and employee lawsuits, Blake Longo continuously pointed out the importance of EPLI coverage for a company. Employment practices liability insurance is not a choice in the 21st century, but a real necessity. As a successful insurance broker, Blake Longo commented after the session, “The insight into and access to EPLI coverage that a human resources outsourcing firm offers their clients is invaluable.”

Moreover, as an expert in skill-based hiring, Diana Peterson-More highlighted the importance of effective recruitment and selection for a company doing business in today’s marketplace. By relying on the skill of experts like the staffing specialists at Total HR Management, a company can not only hone their recruitment and selection, but also improve in the key area of employee retention as well.

Business Growth Workshop

Once again, the Business Growth Workshop at the University Club in Pasadena proved to be a truly valuable resource. By bringing in such respected business leaders, James Harwood of Total HR Management has helped to enhance the value of the monthly gatherings. In June, halfway through the year, the ground covered and the insight gained provided excitement for the next six months to follow in the ongoing series.

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