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Employers are increasingly buying harassment insurance

We've come a long way since the "Mad Men" days when sexual harassment was rampant in many workplaces, and women (and men) had little if any recourse if they were being hit on or worse in the office.

Sexual harassment allegations today can bring down powerful executives. We saw that recently when Fox News chief Roger Ailes resigned (albeit without admitting wrongdoing and with a hefty $40 million exit deal) after a lawsuit by former anchor Gretchen Carlson brought out allegations from other women who had worked for him.

While sexual harassment is still underreported, particularly by employees in lower-paying jobs, the number of claims has increased significantly in the past 25 years. That change has been traced in part back to Anita Hill's famous testimony before Congress.

Settlements and judgments for sexual harassment claims can impact not only a company's reputation, but its bottom line. Enter a (relatively) new product: Employment Practices Liability Insurance. Nearly half of large companies have this type of insurance to protect them if they have to make payouts to employees for harassment or discrimination. However, smaller companies (those with under 1,000 employees) are increasingly purchasing it as well.

Coverage costs more for some companies than others. As with most any type of insurance, premiums are based on how likely underwriters feel it is that a company will need it. They consider things like their history of such claims by employees and whether training is provided to employees regarding what constitutes sexual harassment.

This insurance can be good news for employees on a couple of levels. If companies can reduce their EPLI costs by taking steps to prevent harassment, the chances of it occurring are likely to drop. Further, if an employee does file a harassment claim, the company is probably more likely to settle it if it feels the claim has merit rather than let it go to court.

If you've been the victim of sexual harassment, even if your employer is willing to settle the case, it may be wise to seek the guidance of a West Virginia employment attorney who can advise you on your best course of action and how much of a settlement you should seek.

Source: West Virginia Public Broadcasting, "More companies insure against employee harassment," Lane Wallace, accessed Sep. 22, 2016

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