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Employment Practices Liability Insurance in New Jersey

Many businesses have insurance policies that protect them from external factors, like natural disasters, theft, or other circumstances. However, it can be easy to forget that you should also have insurance policies that protect against internal factors – employees. If an employee feels that your company did them wrong, they may try to fight your business through insurance claims and legal action. That is where employment practices liability insurance comes in to help.

At Blue Lion Insurance Advisors, LLC, we understand the types of coverage a business needs to stay protected. Learn more about employment practices liability insurance, and the importance of having this type of policy.

What Is Employment Practices Liability Insurance?

Employment practice liability insurance (EPLI) is a type of insurance that’s designed to protect businesses if an employee decides to pursue legal action against them. The claims that EPLI protects against pertain to cases in which employees feel that their company has violated their legal rights. While larger companies are more at risk of experiencing these types of claims, smaller businesses are also susceptible. That means all businesses should have some type of EPLI to provide coverage in the case that an employee decides to sue.

Some insurance providers may offer employer practices liability insurance as a part of a Business Owner Policy (BOP). A BOP is a type of insurance that combines multiple policies that a business may need, such as general liability or professional liability, into one. Other insurance providers may only offer EPLI as a stand-alone insurance policy.

Having the right ELPI policy can protect you as a business – not only when something goes wrong in the workplace but also if disgruntled employees try to take advantage of you. While many employees are honest, some may be angry or vengeful after finding out they are no longer employed by your company. In turn, they may go after your company to gain emotional satisfaction or financial objectives. At Blue Lion Insurance Advisors, LLC, we understand the details of ELPI policies, and we can help businesses looking to gain full coverage.

When to Use Employment Practices Liability Insurance

Employer practice liability insurance protects businesses from many claims made within the workplace, including:


Discrimination occurs when an employee feels they are being treated differently from others. The reason for this typically stems from factors or characteristics that an employee cannot change, such as:

  • Age
  • Country of origin
  • Disability
  • Ethnicity
  • Skin color
  • Race
  • Religion or beliefs
  • Sex, sexual orientation, or gender identity
  • Marital status
  • Military status
  • Pregnancy

By having an EPLI policy, businesses can protect themselves against these claims. These policies provide businesses with the funds needed to fight these types of lawsuits, allowing them to continue operations as normal.

Sexual Harassment

Many companies have sexual harassment policies in place to keep employees safe from harm. An ELPI policy can protect your business if these policies are broken or an employee is accused of breaking these policies. At Blue Lion Insurance Advisors, LLC, we understand the importance of handling sexual harassment claims with compassion and respect. Our team is here to help navigate this sensitive subject, providing the support and advice needed to handle these claims.

Invasion of Privacy

While it is normal for companies to track many aspects of a business, employees still have the right to a certain amount of privacy within the workplace. Employees who feel like their company is not respecting their privacy may try to pursue legal action. EPLI can protect your business if this type of claim is made.

Breach of Contract

If a business sets up contract-based employment, employees can seek legal action if they feel their contract has been breached. Some instances that can breach a contract include:

  • Decreasing payments
  • Minimizing the contract duration
  • Switching required employee tasks

Wrongful Termination

Termination is a normal part of running a business. But sometimes, termination can be done out of retaliation or malice. In this case, employees would be able to make a claim for wrongful termination. While state laws for this claim can vary, generally, termination should be done for valid and just reasons. Any company is susceptible to a wrongful termination claim, making it important to have the right EPLI coverage.

Protecting Your Business from Liabilities

There are many ways that businesses can protect themselves from claims before they arise. The team at Blue Lion Insurance Advisors, LLC recommends the following:

  • Adhering to all company procedures, guidelines, and processes
  • Being fair with disciplinary action raises, or promotions
  • Complying with ADA standards in the workplace
  • Consistency with all employees
  • Offering employee handbooks that provide information about harassment and discriminatory policies
  • Using non-discriminatory recruiting and hiring processes

Find Insurance Solutions at Blue Lion Insurance Advisors, LLC

Serving businesses across New Jersey, the team at Blue Lion Insurance Advisors, LLC is here to help. With a dedication to our clients, we can assist you in finding the insurance coverage needed to thrive and stay protected. To learn more about employment practices liability insurance, contact us or request a free quote today.