Employers Premier Choice Policy
Protect your company against the costly repercussions of employment-related lawsuits.
Employment law is constantly changing. Employees and prospective employees are aware of their rights in the workplace now more than ever. Increased merger and acquisition activity, cost-cutting measures and reduction in the workforce have resulted in a rising number of employment-related claims.
Despite companies having strong employment policies and procedures, a commitment to diversity and good relations with employees, we have seen an increase in charges filed with the Equal Employment Opportunity Commission as well as lawsuits against companies. Additionally, we anticipate a significant increase in sexual harassment filings in light of the recent media attention given to this issue.
The following scenarios demonstrate a few examples of these claims. Ask yourself, would your company be adequately protected if it were the defendant?
| CLAIM 1 | |
| Cause of action | Gender Discrimination and Retaliation |
| Type of insured | Industrial |
| Total employees | 720 |
| Total revenue | $100M |
| Synopsis | Five female plaintiffs alleged sex discrimination, retaliation and negligent retention. The plaintiffs alleged that a manager discriminated against them by seeking to terminate them based on their gender and that he and others in the company retaliated against them for complaining about it. The women alleged that the company was a “boys club” that refused to allow women to progress. |
| Resolution | Settled for $941,000. The insured incurred defense fees and costs of $128.000 above the $75,000 self-insured retention. |
| CLAIM 2 | |
| Cause of action | Wrongful Termination in Violation of Public Policy for Reporting and Opposing a Violation of Federal Law |
| Type of insured | Consumer Staples |
| Total employees | 15,000 |
| Total revenue | $l0B |
| Synopsis | A single plaintiff in a high-ranking position alleged wrongful termination in retaliation for complaining that the plaintiff’s employer was violating the False Claims Act by allowing certain personnel to work on a government contract without proper security clearance. Given the sensitive issues and the high rank of the plaintiff, the insured wanted to take this to trial. After a mock jury found for the plaintiff, the insured chose to settle. |
| Resolution | Settled on the eve of trial for $1.35M. The insured incurred defense fees and costs of $2,100,000 above the $500,000 self-insured retention. |
| CLAIM 3 | |
| Cause of action | Whistleblowing and Alleged Retaliation in Violation of the False Claims Act, as Well as constructive Termination |
| Type of insured | Pharmaceuticals |
| Total employees | 2,600 |
| Total revenue | $20M |
| Synopsis | Three former employees alleged unlawful employment practices by a pharmaceutical company, including alleged retaliation and constructive discharge based on their opposition to alleged unlawful sales practices under the federal False Claims Act. They alleged their employer encouraged unapproved off label use and improperly made payments of government funds. |
| Resolution | Settled pre-litigation for $900,000. The insured incurred defense fees and costs of $150,000 above the $300,000 self-insured retention. |
| CLAIM 4 | |
| Cause of action | Sex Discrimination Under Title VII; Pay Discrimination Under the Equal Pay Act and the State Law Equivalent |
| Type of insured | Consumer Finance |
| Total employees | 300 |
| Total revenue | $40M |
| Synopsis | A single plaintiff alleged that she should have been promoted to a senior position that was filled by a male colleague who was less qualified; that he was given a higher compensation package; that comparable male executives received higher compensation; that she was subjected to disparate and retaliatory treatment; and that inappropriate and sex-based comments created a hostile working environment |
| Resolution | Arbitration ruling in plaintiff’s favor for $4.7M. The insured incurred defense costs of $620,000 above the $25,000 self-insured retention. |
What’s the Best Protection Against Worst Case Scenarios?
Regardless of whether claims like the ones above are justified, they compel companies to defend themselves. The process can be time-consuming and expensive. To help your company meet legal and other costs, Atlanta Life offers stand-alone Employment Practices Liability coverage for employment-related allegations, such as:
- Employment discrimination
- Discharge and termination
- Sexual or other workplace harassment
- Retaliation and other workplace torts
- Wrongful dismissal