Big or small, employees sue for sexual harassment or other unlawful harassment in the workplace, invasion of their privacy, libel or slander, emotional distress or discrimination (age, sex, race, pay, etc.). These are just a few of the grounds that can be the basis for claims. Also, many states and municipalities have their own employment related laws that are even broader in scope than many federal laws.

Yes! They can still be sued. The cost to defend an alleged wrongdoing can potentially put a private company at financial risk or even put them out of business. The average suit will cost the average company hundreds of thousands of dollars, internal employee unrest and public relations damage that can take years to undo.

• Studies show, an employer is more likely to have an EPL claim than a GL or property loss insurance.*
• Almost 75% of all litigation against corporations today involves employment disputes.**
• In recent years, there have been more than 75,000 private sector charges filed annually against employers under statutes enforced by the Equal Employment Opportunity Commission.**
• Over 40% of all employment practice claims are filed against private employers who have between 15 and 100 employees. ***
• Employment related lawsuits are the fastest growing type of civil case in the U.S.;  nearly 25% of all litigation in federal court involves employment disputes, and an even higher percentage of these cases are in state courts. ****

*"PLUS" seminar, 6/16/06

**Equal Employment Opportunity Commission (www.eeoc.gov)

***Frankenmuth Mutual Insurance Company

****Human Relationship Failures:"Understanding Your Exposures to Employment Litigation" by Catherine A. Asaro 2005 Beecher Carlson Holdings, Inc.

The cost associated with an employment practices claim can be significant.

• In 2005, the Equal Employment Opportunity Commission (EEOC) recovered $376 million as a result of private sector claims.
• The three most frequent type of claims -- race discrimination, sexual harassment and retaliation -- resulted in recoveries by the EEOC of over $200 million.**
• Based on our estimates, the average cost of a claim against a smaller company is around $50,000 when payment is made to the plaintiff.

**Equal Employment Opportunity Commission (www.eeoc.gov)

• Maintain clear, up-to-date and well-written employment practices handbooks
• Document employee supervision
• Establish grievance procedures
• Circulate written discrimination and sexual harassment policies annually or semiannually
• Establish prudent hiring guidelines, performance guidelines and termination guidelines