• May 05, 2025

EPLI (Employment Practices Liability Insurance) Checklist: Protecting Your Business from Employment-Related Claims

Employment Practices Liability Insurance (EPLI) is a critical safeguard for businesses, protecting them against claims arising from workplace-related issues such as discrimination, harassment, wrongful termination, and retaliation. As employment-related lawsuits continue to rise, having a comprehensive EPLI policy—along with strong internal practices—can help mitigate risks and ensure compliance with labor laws.

Use this checklist to assess your company’s readiness and optimize your EPLI coverage.

1. Evaluate Your Business’s Risk Exposure

– Identify high-risk areas (e.g., hiring, termination, promotions).
– Review past employee complaints or legal actions.
– Assess company size and industry-specific risks (e.g., high turnover sectors).

2. Ensure Proper EPLI Coverage

– Confirm policy covers key claims (discrimination, harassment, wrongful termination, retaliation).
– Check coverage limits and deductibles.
– Verify if defense costs are included or separate from the policy limit.
– Assess whether third-party claims (e.g., clients or vendors) are covered.

3. Implement Strong HR Policies & Procedures

– Maintain an updated employee handbook with clear policies.
– Enforce anti-discrimination, anti-harassment, and anti-retaliation policies.
– Establish a structured hiring, promotion, and termination process.
– Document all employment decisions and disciplinary actions.

4. Train Employees & Management

– Conduct regular compliance training on workplace laws (e.g., Title VII, ADA, FMLA).
– Train managers on proper hiring, firing, and performance review practices.
– Educate employees on reporting procedures for complaints.

5. Maintain Proper Documentation

– Keep detailed records of employee performance reviews and disciplinary actions.
– Document investigations into workplace complaints.
– Store employment contracts, offer letters, and termination records securely.

6. Establish a Complaint Resolution Process

– Provide multiple reporting channels (HR, anonymous hotlines).
– Ensure prompt and impartial investigations of complaints.
– Follow up with corrective actions when necessary.

7. Review State & Federal Compliance

– Stay updated on labor laws (federal, state, and local).
– Ensure compliance with wage and hour laws (FLSA), OSHA, and EEOC guidelines.
– Adjust policies as laws change (e.g., remote work regulations).

8. Work with Legal & Insurance Professionals

– Consult an employment attorney for policy reviews and risk assessments.
– Partner with an insurance broker specializing in EPLI.
– Periodically reassess coverage as your business grows.

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Final Thoughts

EPLI is an essential component of risk management for businesses of all sizes. By proactively implementing strong HR practices, maintaining compliance, and securing appropriate insurance coverage, companies can reduce exposure to costly employment claims. Regularly revisiting this checklist will help ensure ongoing protection and a fair, legally compliant workplace.

Would you like any modifications or additional details on specific sections?