Wrongful Termination Insurance Explained

Most companies buy a variety of insurance policies. Wrongful Termination insurance is one of those insurance products. You may never need it, but you should understand and educate yourself about your employee rights and make sure your employer carries this type of insurance.

What is Wrongful Termination?

When your company decides to fire you, they must follow the law. It ensures you aren't fired because of sexual harassment or discrimination based on your gender, religious beliefs, race or disability. It also protects you if you're fired for being a whistle-blower, if your employer fails to employ or promote you, if you undergo wrongful discipline or if you're a victim of employee contract violations.

Why Does Your Employer Carry Wrongful Termination Insurance?

In the past, regular Business Liability insurance covered wrongful terminations. Today, businesses purchase Employment Practices Liability (EPL) insurance. It covers wrongful termination, discrimination, sexual harassment, breach of contract, wage violations and civil rights violations. Companies with more employees or a history of discrimination lawsuits will definitely want this coverage, but it's a good idea for all businesses.

When Would you use Wrongful Termination Insurance?

If you think you're a victim of wrongful termination, immediately contact an attorney who specializes in employee rights. He or she will help you understand your rights and the next steps you need to take.

As part of this process, collect information like why you were fired and who fired you. Also, gather written documentation, if possible, including a hard copy of your employee contract and personal file. With this information, your attorney can possibly negotiate for you to keep your job. You might also be able to keep your employment benefits or gain a suitable severance package.

Wrongful Termination insurance is just one of many policy types a business can buy. As an employee of any company, you should know your rights. So, check with your employer about their coverage and ensure you can receive compensation if you're wrongfully terminated.

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