A recent article in Corporate Counsel Magazine observed that employees are suing employers more frequently than in the past.
The article listed a wide range of occupations that have filed pay-related claims, including skycaps, bank loan officers, bartenders, phone company engineers, financial research associates, exotic dancers, drug store assistant managers, computer technicians, janitors, paramedics, delivery truck drivers, exterminators, waiters, cable TV repair workers, and chicken processors.
Defense counsel has compared the current employment law environment to an earlier era of frequent slip-and-fall litigation for plaintiffs' attorneys.
Companies today face ongoing challenges from regulatory changes, including updates to leave and disability rules, an expanded labor board and civil-rights enforcement agendas, and increased wage-and-hour and discrimination claims.
Many large class-action filings are brought knowing a company may prefer to settle rather than litigate, and many individual claims also lack merit. Employers should be prepared for both class and single-plaintiff exposure, and for guidance on insurance implications see Rising Employee Lawsuits and Insurance Implications.
Wage-and-hour class action claims remain a major concern for larger firms, though many small and mid-sized employers (for example, those with 15 to 500 employees) may be too small to attract large class cases.
Still, smaller companies remain subject to individual wage-and-hour suits and discrimination allegations, and should consider how these risks intersect with workplace safety and workers' compensation programs described in Workers' Compensation Policy Changes and Workplace Safety.
There is also widespread concern about discrimination litigation. Common bases for claims include race, sex, disability, age, national origin, religion, and pay disparity allegations, and many complaints allege retaliation as well.
How courts rule on large class-action and certification issues will affect the exposure of many employers, and decisions in high-profile cases can change litigation dynamics across industries.
The practical lesson for employers is risk management: maintain appropriate Employment Practices Liability Insurance (EPLI), implement clear policies and training, and investigate employee complaints promptly and thoroughly—usually with the assistance of counsel or an insurance professional.
If you need to review your coverage or next steps, consider contacting or talk to an agent to discuss policy options and risk controls.
Frequently Asked Questions
What is Employment Practices Liability Insurance (EPLI)?
EPLI is a policy that helps cover defense costs and settlements for claims such as discrimination, harassment, wrongful termination, and retaliation.
Does EPLI cover wage-and-hour claims?
Coverage varies by policy; some EPLI policies exclude wage-and-hour claims, so review policy language and consult an agent or broker.
How should an employer respond when an employee files a complaint?
Investigate promptly and thoroughly, document findings, and involve counsel and insurance representatives as appropriate.
Are smaller employers at risk of class-action suits?
Smaller employers are less likely to face large class actions but can still be subject to individual claims and may benefit from preventive policies and training.