New Employment Practices Liability Resources

Employment practices liability (EPL) claims alleging wrongful employment acts such as discrimination, harassment, retaliation, and wrongful termination, have for some time been among the most severe experienced by the California JPIA. Indeed, in the 10 years from 2008 to 2018, the Authority spent approximately $50 million defending and resolving EPL claims. Members also incur a variety of other costs related to such claims. These include the cost of conducting internal investigations, responding to and defending against EEOC/DFEH claims, and costs associated with the reduction in employee morale and productivity. These costs are uninsurable and are borne individually by each member.

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The Authority has historically provided several resources to assist members in this area. These include instructor-led and online self-paced harassment prevention training, HR policy templates, and an EPL hotline that members can contact for guidance on addressing challenging or complex employment matters.

In 2019, to better understand why EPL claims persist at such a high frequency and severity despite the availability of these resources, Authority staff formed an EPL task force. The task force analyzed claim data, solicited input from subject matter experts and member HR and management staff, and ultimately developed a series of recommendations for how the Authority can better assist member agencies in managing this risk.

To prevent or reduce EPL claims, member leadership must cultivate a work environment of civility and respect, the task force concluded. Further, members must adopt a no-tolerance approach toward abusive and harassing behaviors. When such behaviors occur, members must act decisively to correct the behavior and impose appropriate discipline.

The task force also recommended development of the following resources to better assist members with managing EPL exposures:

• Training to address organizational culture and the behaviors of employees and officials. Topics include abusive conduct, ethics, cultural diversity, implicit bias, nepotism, and cronyism.
• Training to improve manager and supervisor soft skills. Topics include effective communication, teamwork, and conflict resolution.
• HR practitioner training. Topics include absence management, disability management, discipline, compensation, and labor relations.
• Additional HR policy templates and other HR reference materials.
• Access to an anonymous harassment reporting system.
• An EPL white paper making the business case for why member leadership should actively manage EPL exposures.

These additional resources, which will be rolled out in the coming months, are designed to help members address the root causes of EPL claims, and thus prevent or reduce the frequency and severity of such claims. Authority staff is optimistic that these initiatives will have the desired effect.

If you have any questions about these upcoming resources, please contact your regional Risk Manager.

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