Are You Covered If Your Housekeeper Sues You?
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Private Insurance Plans Can Cover EPLI
It’s a common misconception that coverage against any lawsuit is included with a homeowners or excess liability policy. In fact, most policies exclude coverage for lawsuits based on wrongful employment practices.
EPLI (employment practices liability insurance) offers coverage for people who employ domestic staff, including personal drivers, childcare providers, housekeepers, kitchen staff and caretakers. EPLI coverage can be added onto an excess liability policy and provides protection in the event that a domestic employee sues for:
- Wrongful termination
- Breach of employment contract
- Emotional distress
- Wage and hour law violations
- Invasion of privacy
- Libel or slander
EPLI coverage will reimburse legal defense costs in the event of a lawsuit, as well as judgments and settlements, and can be added onto most excess liability policies. Typically, this coverage excludes bodily injury, property damage or intentional/dishonest acts, so it’s important to make sure you have coverage for accidents that may occur on your property and that your employee has individual coverage.
When protecting yourself against domestic lawsuits, liability insurance is only half the picture. The other half includes using best practices when hiring and terminating domestic employees to reduce the risk of a lawsuit.
Domestic Staff Hiring Tips
- Have a heightened attention to detail during the interview process. Ask follow up questions to anything that sounds fishy.
- Check references thoroughly to learn about employment history, personality traits, habits, work ethic and morality.
- Obtain a thorough background check so you feel safe and confident inviting this new employee into your home.
- If a company provides you with an employee whom you’re uncomfortable with, ask for a new employee to service your needs (e.g. nanny service, landscaping crew, cleaning crew, etc.). If the servicing company is unwilling to accommodate your request, hire a different company.
- Ensure that you’re not unintentionally hiring someone who’s not legally allowed to work for you based on national status, citizenship or work permits.
Domestic Staff Termination Tips
- Have an open conversation via an exit interview. Offer an explanation and discuss anything that could potentially lead to legal action by you or the employee.
- Keep a copy of any required documentation and provide a copy of any documents due to the employee.
To learn more about EPLI, add it to your excess liability policy or obtain a quote, contact a Private Insurance Management ‘A’ Team member.
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