Contrary to what many insurers assert, lawsuits alleging wage and hour, or labor code violations may be covered under Employment Practices Liability insurance policies, Partner Shaun Crosner told Law.com’s Insurance Coverage Law Center. In a feature interview, Crosner weighed in on coverage for such claims; what language in an EPL policy is important; and tips that will allow employers to obtain and maximize their insurance recovery for such claims. Below are some of the interview highlights.
What Language in an EPL Policy is Important?
“All policy language is important as any policy term or condition could have a bearing on coverage for a particular claim,” Crosner said. “EPL policies tend to provide very broad coverage, and exclusions and other limitations are not always as broad as EPL insurers might contend. Insured employers and their counsel should, therefore, scrutinize denials and other adverse coverage positions.”
Risk Management Issues and Pre-Litigation Strategies for Employers
“From a risk management perspective, it is important for insured employers and their counsel to be thinking about insurance early in the process,” Crosner commented. “Insured employers and their counsel should review their EPL policies to determine both timing-related requirements and what claims need to be reported—and should make every effort to comply with those requirements.”
What Can Employers Expect as Wage and Hour Lawsuits Continue to Increase?
Crosner noted that the insurance coverage landscape is always changing. “Each year, EPL insurers modify their coverage forms and make changes to policy terms and conditions, and there are new decisions from courts and arbitrators interpreting the key policy provisions,” he said. “In terms of the ‘big picture,’ employers and their counsel should not discount the possibility that their EPL policies might afford them with valuable coverage to help defray the costs associated with defending and resolving claims alleging wage-hour and other labor code violations,” Crosner added.
Read the Law.com’s Insurance Coverage Law Center interview here (subscription required).