Tough Economy Fuels Rise in Employment Liability Claims

Paid employment practices liability claims jumped 35% during 2011.

August 05, 2012
/ PRINT / ShareShare / Text Size +

The struggling economy has fueled a steep rise in employment practices liability [EPL] claims, says Jay Isaacson, director of product management, Credit Union Protection, for CUNA Mutual Group.

He says the company’s paid EPL claims jumped 35% during 2011, and that 65% of the claims on CUNA Mutual’s management professional liability policy are EPL-related.

“There’s a clear correlation between EPL claims and unemployment,” Isaacson says. “Unemployment remains at elevated levels today, and that’s causing challenges. As employees get displaced from their jobs, one avenue they sometimes take is to file EPL claims against their former employers.”

Falling under the EPL umbrella are claims for discrimination based on race or gender, sexual harassment, retaliation, and wrongful termination, he explains.

Credit unions aren’t the only businesses to face more EPL claims. The Equal Employment Opportunity Commission (EEOC), which tracks claims across all industries, reported record claims filed in 2011—after record claims were reported during 2010.

“We’re seeing roughly 100,000 charges coming through EEOC on an annual basis,” Isaacson says.

He says credit unions can reduce their exposure by:

  • Training staff and managers about the potential exposures they face;
  • Reviewing the employee handbook to make sure it’s up to date and has been reviewed by legal counsel; and
  • Establishing formal policies and procedures, in addition to the employee handbook, that cover issues such as anti-retaliation procedures.

Credit unions should work with legal counsel when implementing employment policies. Another resource for policyholders is CUNA Mutual’s risk management department, which has sample policies and procedures.

Post a comment to this story


What's Popular

Popular Stories

Recent Discussion

Great article! Unfortunately, most employees don’t feel valued or appreciated by their supervisors or employers. In fact, research has shown that the predominant reason team members quit their jobs is because they don’t feel valued. This is in spite of the fact that employee recognition programs have proliferated in the workplace – over 90% of all organizations in the U.S. has some form of employee recognition activities in place. But most employee recognition programs are viewed with skepticism and cynicism – because they aren’t viewed as being genuine in their communication of appreciation. Getting the “employee of the month” award, receiving a certificate of recognition, or a “Way to go, team!” email just don’t get the job done. How do you communicate authentic appreciation? We have found people have different ways that they want to be shown appreciation, and if you don’t communicate in the language of appreciation important to them, you essentially “miss the mark”. Additionally, employees need to receive recognition more than once a year at their performance review. Otherwise, they view the praise as “going through the motions”. A third component of authentic appreciation is that the communication has to be about them personally – not the department, not their group, but something they did. Finally, they have to believe that you mean what you say. How you treat them has to match the words you use. If you are not sure how your team members want to be shown appreciation, the Motivating By Appreciation Inventory ( will identify the language of appreciation and specific actions preferred by each employee. You then can create a group profile for your team, so everyone knows how to encourage one another. Remember, employees want to know that they are valued for what they contribute to the success of the organization. And communicating authentic appreciation in the ways they desire it can make the difference between keeping your quality team members or having a negative work environment that everyone wants to leave. Paul White, Ph.D., is the co-author of The 5 Languages of Appreciation in the Workplace with Dr. Gary Chapman.

Your Say: Who should be Credit Union Magazine's 2014 CU Hero of the Year?

View Results Poll Archive