Hire “At Will” – Terminate “For Cause”
As an insurance agency, we see approximately 50% or more of liability driven claims arising out of Employment Practices. This statistic is shocking and impacts the church the same as it does the secular business world. Many non-profits will make the case NOT to purchase Employment Practices Liability coverage stating they are protected under “at will” employment laws. The relationship between Employer and Employee is considered “at will” meaning the employer can terminate the employee anytime for any reason.
However, there are exceptions that provide protection for the employee in the event of:
- Wrongful termination / Breach of employment contract
- Wrongful failure to promote
- Violation of employment discrimination laws (including harassment)
- Wrongful deprivation of a career opportunity
- Employment related wrongful discipline
- Negligent employee evaluation
- Employment related invasion of privacy
- Employment related defamation (including libel and slander)
- Sexual or workplace harassment
- Constructive discharge of employment
- Employment related retaliation / humiliation
- Wrongful demotion / Negligent reassignment
- Violation of any federal, state or civil rights laws
These EEOC (Equal Employment Opportunity Commission) complaints surface after termination and the church has to respond to the alleged complaint. This triggers the organization’s Employment Practices Liability coverage, if they have opted to purchase it which is normally in a Package policy or Packaged with the organizations Directors and Officers Coverage policy. It is vital to make sure your organization has this coverage as these claims can be very expensive.
What can your organization do to minimize this risk?
- It is important that your organization’s policies and procedures are in order. This is one area where we recommend spending the money and having an attorney review your Employee Handbook and your personnel policies and procedures.
- Train – Train – Train. We cannot emphasize enough the importance of training your staff. Your entire staff needs training on Sexual Harassment. What it is and how to appropriately conduct themselves with each other. For Example: many cases arise out of comments that were innocent but taken out of context and are offensive to someone else.
- Supervisors who receive complaints need to report up!! Often you’ll see cases where the employee has complained multiple times to their supervisor and the Administrative Office never hears about it until they receive the official EEOC complaint! It’s important that you train your team to report any complaints up the chain.
- Be sure that every employee has a Job Description that outlines the scope of their duties. Confusion can rise when there is lack of clarity!
- Lack of communication. A basic root cause to so many issues related to EEOC claims.
Our agency is a full service agency and we provide Risk Management Services. Please do not hesitate to call us if we can assist you. We know that navigating all of this is not easy. Our intent is to at least get this on your radar and bring awareness. Employment Related Practices claims are a large exposure for the ministry and one the organization does not need to simply take a reactive approach on. These type of claims don’t discriminate, they affect every size ministry.