Do You Have Domestic Workers?
Updated: Jun 19
Homeowner's insurance may not cover your risk. You may need EPLI.
Your homeowners liability policy protects you from third-party claims, but what happens when a domestic worker sues you? You may be considered their employer, which means you're potentially exposed and unprotected. Employment practices liability (EPLI) insurance can help.
A domestic worker could file a lawsuit against you, just like an employee
You might have hired through a service or agency, thinking this would reduce your hassle and legal exposure. But depending on the agency's insurance and the employment arrangement, you might still be at risk. Your assets or public image could also make you a target, even if the court eventually dismisses the lawsuit.
When you consider your liability exposure from an employer's perspective, you've got a few risks to contend with: discrimination, harassment or wrongful termination. You might even be at risk for a lawsuit regarding COVID-19 issues, from failure to abide by the Families First Coronavirus Response Act (FFCRA) to vaccine discrimination (either for or against).
EPL insurance can help, and we can help you understand what's covered.
Even if you're innocent, defense costs can be steep
Even if the court dismisses the claim, you still have to mount a legal defense. If you're found liable, the finding could come with a weighty judgment against you. Then again, you might opt to settle out of court before a trial. Either way, your costs could easily run into six or seven figures.
EPL insurance helps offset the costs
Employment practices liability insurance can help protect your assets while also providing legal defense in a lawsuit. Coverage can help with allegations of:
Breach of employment contract (traditionally a written contract, but it can be oral)
Failure to employ or promote
Emotional distress (witnessing a violent incident or harassment, for example)
Mismanagement of benefits (exclusions apply here)
Family Medical Leave Act (FMLA) violations
Some insurance companies may appoint a law firm for you. Depending on the situation, this can be good; they'll select a law firm with the right kind of experience, and they might negotiate a settlement before the claim gets to trial. However, the settlement terms will be out of your control if the insurance company controls your defense.
If you want to use your personal attorney, let us know, and we'll check on the available options.
A word on other risk exposures you might have
If your nanny takes a tumble while chasing after the kids, you need to make sure you're poised to respond. Employment practices liability won't be the policy to tap for injuries. You might want to consider a workers' compensation policy, depending on what state you live in.
Also, let us know if one or more of your domestic workers drives your vehicles so we can keep your coverage going, even on the road.
We're here to help
Contact V.F. McNeil Insurance today at (203) 481-2684 or request an appointment online to get started on your employment practices liability insurance quote. We're happy to answer your questions and help you protect your areas of exposure. We'll walk you through the details and exclusions to make sure you're confident about your type and level of protection.