Employment Practices Liability (EPL) Insurance

How Employment Practices Liability Insurance Protects Pharmacists

Trust is a huge component of the Community Pharmacy system in Australia. Many people know their pharmacist by name and look to them for medical advice, information, and reassurance. Pharmacists are an important part of a community as we have seen throughout the pandemic and during the recent floods in Queensland and New South Wales.

Employment Risks for Pharmacists and Pharmacy Owners

Ongoing changes in the workplace, particularly highlighted by the recent Covid-19 pandemic, have exposed small to medium sized private companies (SMEs), such as community pharmacists, to a range of potential staffing issues. Employers can be held liable for the decisions they make regarding:

  • employment
  • promotion
  • dismissal
  • employment procedures and policies
  • the working environment provided for employees.

So, what does this mean for you?

To give you an example, as insurance specialists, Carollo Horton are currently involved in a case where a pharmacy staff member, who was fired during her probationary period, is now suing the business for workplace bullying and harassment.

While protection of employees’ rights is always necessary, it is equally important that pharmacists minimise their risk and the impact of the potential cost of a claim, should such a situation arise.

From a business insurance perspective, you have a couple of options to consider:

Employment Practices Liability (EPL) Insurance

Employment Practices Liability (EPL) insurance is designed to provide cover for actions taken by employees against employers for a range of issues, including:

  • Alleged discrimination
  • Unfair dismissal
  • Sexual harassment
  • Bullying
  • Breach of employment contract
  • Negligent evaluation
  • Failure to employ or promote
  • Wrongful discipline
  • Deprivation of career opportunity
  • Wrongful infliction of emotional distress

It does not cover employers for losses arising from claims that are attributable to or in consequence of:

  • Paying employee benefits
  • Bodily injury
  • Building modifications
  • Continuity of employment costs
  • Criminal proceedings
  • Fraud and Dishonesty
  • Property damage
  • Prior or pending claims that arose before insurance was taken out (Insurance Information Institute)

Management Liability (ML) Insurance

ML is more complex insurance that is designed to provide cover for SMEs against the risks and liabilities associated with running and managing a small business, including:

  • Employee Practices Liability
  • Allegations of mismanagement
  • Crime
  • Statutory Liability
  • Tax Audit Costs
  • Identity Fraud expenses

EPL or ML policies do not cover losses relating to the underpayment of wages or failure to pay employee benefits (such as redundancy or superannuation) because the employer is legally responsible for these.

How Carollo Horton help you Protect your Business

Proactive Advice for Pharmacists and Pharmacy Owners

We help you reduce your risk of impact from decisions relating to employee management and workplace safety. Working with you and our partners at Employsure,

we conduct a review of your current documents and processes, offer you protection, and provide solutions for workplace compliance. Through this process we will:

  • Identify your risks and potential liabilities
  • Assess the types of insurance that suit your individual and business needs, and your budget
  • Ensure you have the right protection against any legal or negligence claims
  • Identify innovation in insurance offerings for changes in the pharmacy industry, such as those created by Covid-19 legislation and My Health Plan.

Advice regarding EPL / ML insurance and Representation in the Event of a Claim

Prospective, past or current employees are entitled to make a claim, regardless of whether they have been employed on a full-time, part-time or casual basis.

In our earlier example, should the pharmacy owner be found to be liable for workplace bullying or harassment, their insurance policy will cover legal defence costs, damages, and other costs required to settle the matter, (up to the EPL policy sub-limit). Although it is an initial and ongoing expense, in this situation, it could save you significant financial expense and protect you against risk to the long-term financial viability of your pharmacy.

Community Pharmacies are an integral part of our society. Pharmacists and their employees build trust with their community and each other every day. Knowing you can trust your insurance policies and provider to mitigate your risk, and enable you to continue to support your community, is a crucial part of your business plan, now and in the future.

For more information on Employment Practices Liability or Management Liability insurance policies contact Carollo Horton today!