EPLI Coverage: The Risks of Workplace Flexibility- Part 1

EPLI Coverage: The Risks of Workplace Flexibility- Part 1

Over the past few years, there has been a much greater  acceptance of flexible work schedules amongst employers, allowing employees to spend less time in the office itself while still getting their daily tasks done for work. In 2008, only half of employers offered a flexible work arrangement to employees. According to a new study from the Society for Human Resource Management and Families and Work Institute, now it’s about 67% of employers who offer some form of telecommuting.

Critics, however, are questioning whether or not this workplace flexibility could actually be harming employers, and wondering how it can impact EPLI Coverage. EPLI, Employment Practices Liability Insurance, is designed to protect employers financially in the event of an employee based lawsuit. Most employee lawsuits in recent years have been on the basis of discrimination of some kind, or claims of wrongful termination. These cases can get tricky when it comes to employers that do offer workplace flexibility.

For example, if it appears that your client is granting flexible work arrangements mostly to younger, or white, employees, they could very well be exposed to a discrimination claim, even if the exclusion of minorities was unintentional. While EPLI Coverage will provide financial protection to your client against legal fees and defense costs, it’s best for your client to try to avoid this type of scenario all together. Experts recommend that employers who wish to implement a workplace flexibility program establish and disseminate clear policies and procedures to assure that supervisors make nondiscriminatory decisions based on sound business reasons.

Another scenario where workplace flexibility can get tricky is in cases of wrongful termination. If an employee is offered the chance to work remotely, yet is not meeting the basic requirements of the job, an employer may feel entitled to terminate them. This could easily lead to a legal problem if the program has not been implemented correctly.

Workplace discrimination and wrongful termination are just a couple examples of EPLI claims that could arise due to improper implementation of a workplace flexibility program. In part two of this post, we will look at how certain federal laws, such as the ADA, can conflict with these programs.

At PL Risk Advisors, we understand the unique exposures that each of your clients face. We know that with increases pressure and an aggressively proactive stance by the EEOC, businesses are increasingly facing allegations from employees for racial and religious discrimination, sexual harassment, FMLA violations, and more. Employment Practices Liability Insurance (EPLI Coverage) should be part of any employer’s comprehensive insurance program. To learn more about what we offer, please contact us at (855) 403-5982.