Why Do Businesses That Follow Labor Laws Need an EPLI Polciy?
Businesses generally should follow all applicable labor laws, and this can greatly reduce a business’ chances of being sued by an employee. Simply following the law, however, is not a completely bulletproof way to protect against potential employment-related lawsuits.
Since lawsuits can be expensive to defend against even if the accused party is innocent of the allegations, businesses generally should be prepared to defend themselves against inaccurate allegations that claim labor laws were broken. An EPLI policy can be an important part of a business’ preparation for potential lawsuits.
Do Businesses Need an EPLI Policy If They Have Workers Compensation Insurance?
EPLI policies and workers compensation policies both offer protection against risks that come with hiring employees. The types of incidents that these two insurances protect against are significantly different, though. EPLI policies typically shield businesses from employment-related lawsuits, while workers compensation generally protects against work-related injuries and illnesses.
Thus, businesses that have workers compensation insurance usually still need an EPLI policy because the two tend to provide different protections.