Condo Media - July 2017 - 43

instead, how much it is going to cost the
association and management company
to defend against the claim-regardless
of whether the claim has merit or not.
The possibility of having to pay for
the plaintiff's attorney's fees in these
matters causes board members and
owners of management companies
pause in making decisions on how best
to defend against such claims (i.e.,
whether to vigorously defend or, alternatively, to make a business decision
to settle the matter due to the possible
costs to the association in defending
against such claims).
This conundrum is the reason why I
advise clients, who have employees, that
they should invest in Employment Practices Liability Insurance (EPLI) to take the
costs of defending against an employmentrelated lawsuit out of the equation.
EMPLOYMENT PRACTICES
LIABILITY INSURANCE (EPLI)
EPLI provides coverage and protection to
employers against many type of employment-related claims made by employees
including, but not limited to, claims of:
n Sexual harassment
n Discrimination
n Wrongful termination

n Breach of employment contract
n Negligent evaluation
n Failure to employ or promote
n Wrongful discipline
n Wrongful infliction of emotional

distress

The number of complaints filed by employees against their employers has been,
and still is, on the rise. In the past, most
suits were filed against large corporations;
however, no company or association
employer is immune to such claims. As a
result, insurers provide this coverage as
an endorsement to existing policies, while
other insurance companies offer EPLI as
a stand-alone coverage.
The cost of EPLI coverage depends on
numerous factors, such as the number of
employees you have and various risk factors (e.g., whether you have been sued over
employment practices in the past). The
policies typically will reimburse against
the costs of defending a lawsuit before the
administrative agency and court, and possibly provide coverage for judgments and
settlements. Consultation with your insurance agent is recommended to determine
the type of policy needed for your association's or management company's needs.
Armed with EPLI, an association and
management employer, who is served

with a complaint for employment discrimination, can make a business decision
on how best to defend against such claim
without having to worry about tapping
into the condominium reserve funds
or issuing assessments to unit owners
to defend against the suit. EPLI allows
employers to focus on strategies on how
best to defend against such claims and
to assess the merit of any such actions.
In the event a compelling case has been
brought by an employee, EPLI further
affords the employer protection from
paying for a defense and possible unfavorable judgment.

n DOUGLAS A. TROYER, ESQ.,
IS A FOUNDING PRINCIPAL IN
THE LAW FIRM OF MORIARTY
TROYER & MALLOY LLC.

Prevent Employee Lawsuits
Minimize Problems in the First Place

Following these tips and having the proper insurance in place will put a condominium
association and management company in a secure financial position to defend
against employment-related matters.
n Create effective applications and policies for hiring and screening potential

employees to avoid discrimination in hiring.

n Be sure to post employer policies and the required state and federal labor informa-

tional labor posters in common areas of the workplace and provide employees with
employee handbooks so policies are clear to everyone.
n Make sure employees are aware of the steps to take if they are the object of sexual
harassment or discrimination by a supervisor. Make sure supervisors know where the
employer stands as to behaviors that are and are not permissible.
n Take the time to document everything that occurs with an employee, whether it
be good or bad, and document the steps you take to prevent and solve employee
disputes.
n Maintain and update employee files.
July 2017

43
http://www.ccaco.com http://www.ccaco.com
Condo Media - July 2017

Table of Contents for the Digital Edition of Condo Media - July 2017
