A new insurance policy has been introduced to protect businesses from the potentially financially devastating law suits relating to discrimination and wrongful dismissal disputes.
The Brisbane-based firm Specialist Underwriting Agencies has designed the Employment Practices Liability insurance to cover businesses over claims from employees, former employees and job applicants.
According to Ron Youels, director of marketing for Specialist Underwriting Agencies, litigation against employers raised by their employees is ever increasing. "In today's employment environment, people are quick to sue if they feel wronged," he said.
Youels said that in some instances of wrongful termination cases courts have ordered the employer to reinstate or compensate the employee with up to six months salary.
The new policy specifically covers litigation, involving: wrongful failure to promote, sexual harassment, wrongful refusal to employ, wrongful termination, defamation of character, libel, slander, invasion of privacy, and discrimination on the grounds of race, colour, marital status, mental disability, sex, age, physical disability, pregnancy, and sexual preference.
The policy does not cover dishonest, criminal, fraudulent or wilful acts on the part of employers who are party to sexual harassment, for example, Youels said. Frank Page, director of Specialist Underwriting Agencies, said that the policy has been priced to sell.
It is underwritten by Lumley General Insurance for one million dollars for the standard policy. The annual premium depends on the size of the company, starting at about $500 for 15 employees, $2100 for 50 employees and around $2800 for 80 employees.
Graham Young, the managing director of specialist IT recruitment agency Anagram International, believes the policy may be valuable to businesses that run a high risk of discrimination and wrongful dismissal disputes. He cautioned, however, that preventative management practices should also be put in place to avoid such cases.
Interested businesses should contact their insurance broker to request a quote from Specialist Underwriting Agencies or phone directly on 1800 803 264.