Employment Practices Liability Insurance for North Carolina Home Care Agencies
Claims against employers for discrimination, harassment, wrongful termination, retaliation, and wage and hour violations are at an all-time high. A North Carolina home care insurance program needs to account for them.
Five reasons home care agencies carry EPLI
- More than 40% of EPL claims are filed against firms with fewer than 100 employees.
- Each year, three out of five employers are sued by a former employee.
- Without EPL coverage, a claim could cripple a small firm, which may lack the budget to cover defense costs, much less a settlement or judgment.
- The median compensatory award to plaintiffs is $325,000.
- EPL covers alleged acts, not only proven ones: discrimination, harassment, retaliation, wrongful termination, and similar claims.
Costs like these could put an agency out of business.
Employment law keeps changing. For most small and midsize businesses, keeping up with every new law and regulation is close to impossible.
More claims now arise from "tangible adverse employment actions": layoffs, downsizing, frozen pay, reduced hours or benefits, failure to hire or promote, careless evaluations, and unfair discipline. Employers often struggle to win these cases because their documentation and records fall short.
Many cases come down to one person's word against another's, which is highly subjective. As a result, nearly all of them settle out of court.
What EPLI really provides is the money to defend and settle the claim. It keeps the owner of a home care agency from paying that claim out of the company's cash.
North Carolina home care agencies may face this exposure more heavily than many employers. Caregiver turnover can run high, and any departure could turn into a claim. An agency with a large roster of hourly caregivers spread across client homes fits the profile these claims often target.
The three parts of an EPLI policy
Getting EPLI right for your home care agency starts with knowing that a policy has distinct parts.
- First-party coverage: responds when an employee brings an EPL claim against the agency.
- Third-party coverage: responds when a client or consumer brings a claim against the agency over a caregiver's conduct, such as discrimination against the client. Caregiving can be stressful, and an unintended remark on the job could become a claim.
- Wage and hour defense coverage: most home care agencies pay caregivers by the hour. Mistakes in tracking hours or calculating overtime could lead to fines, penalties, and damage claims.
North Carolina agencies should look closely at wage and hour exposure. Overtime, travel time between client homes, and on-call hours are frequent sources of payroll mistakes, and one error repeated across a caregiver roster could become a claim that covers every employee on it.
Some EPL policies include DEFENSE COVERAGE for wage and labor lawsuits. The policy pays attorney fees, but not back wages if payroll errors are proven.
Frequently Asked Questions
Why would a North Carolina home care agency need EPLI?
More than 40% of EPL claims involve firms with fewer than 100 employees, and three of five employers are sued by former employees each year. The median compensatory award is $325,000. Most North Carolina home care agencies fall right in that size range.
Who can bring a claim under EPLI?
Employees, under first-party coverage, and clients or patients, under third-party coverage. Both cover actual and alleged discrimination, harassment, retaliation, and wrongful termination.
Will EPLI pay for overtime mistakes?
Some policies include defense coverage for wage and hour lawsuits. They pay attorney fees but not back wages if payroll errors are proven.