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Blog with Rob: Guest Post by Gregg Knepper: What if my employee sues me?

Oct 2014
Posted in Blog with Rob


I have a Business Owners Policy (BOP); am I protected if one of my employees sues me?

Lawsuits brought by employees or ex-employees are often very costly and time consuming. Typically, employment related claims are excluded from standard “BOP” policies. This type of exposure is best covered by an EPLI (employment practices liability) policy. Management can face large financial and reputational risks when treatment of employees veers outside the bounds of legally acceptable practices.

The good news is such lawsuits generally don’t occur without warning, and are usually the final link in a long contentious chain of management-employee relations.  Following are four practical suggestions that can help management break, or better yet completely avoid this costly chain.

Train Your Managers

Fundamental, but always helpful.   Management training can, among other things, sensitize managers to the kind of issues such as wrongful termination and discrimination that pose common legal risks.   Training raises managerial awareness, a first step in prevention.

Document Diligently

A key function for all managers everywhere, when serious employee-related issues occur, is to document them diligently.  Having a thorough, accurate record of a past history of employee problems can prove invaluable to management should allegations of management impropriety later be raised.   Good records make good management.  Sometimes the best offense is a good defense.  But better still is to:

Recognize “situations” before they become problems

Managers need to develop their own “risk antennae” that help them become aware of potential employee-related minefields – for example, repeated serious run-ins with especially argumentative, cantankerous (i.e. potentially litigious) individuals.  When such situations are recognized early, they can be defused, or at least handled carefully.  Of course it’s difficult to expect managers to become experts in the nuances of employment law… which brings me to my last and perhaps most important point:

Consult with Human Resources and attorneys on a preventative basis

Some of the best risk-mitigation aids managers will ever have are just a text, email or phone call away.  Most organizations, and all large organizations, have HR and/or lawyers on staff or retainer for delicate, troublesome employee matters.

Taking actions to prevent costly employee lawsuits is a little like a poker game.  There’s a lot of bluffing, but when a serious game is finally underway, stakes are high.  The best protection against employee related claims is to follow proper protocol.   Additionally, procuring an Employment Practices Liability (EPLI) insurance policy is a great way to protect your business in the event of sometimes unavoidable employee related claims.

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