Universities are learning a costly lesson in hiring practices
Employment-related lawsuits surrounding sexual harassment, job discrimination and wrongful termination are prevalent in today’s working environment. For colleges and universities, lawsuits from current and former employees can cause crippling financial damage and reputational harm. Even claims eventually proven frivolous can cost tens of thousands of dollars to defend.
Rising costs, increased focus
The average cost of an employment practices liability (EPL) claim is on the rise, in part due to increased value assigned to damages and rising defense costs. In fact, the cost to defend a lawsuit in 2018 rose 33%. The average suit takes between 12 to 18 months to reach resolution, causing organizations such as colleges and universities to retain defense counsel for an extended, costly period of time.1
There is increasing focus on employment discrimination by colleges and universities.
- The University of Denver recently faced a pay discrimination lawsuit brought about by the U.S. Equal Employment Opportunity Commission (EEOC).2 The lawsuit charged that female professors were paid an average of nearly $20,000 less than their male counterparts, and the university declined to take corrective action. The university was ordered to pay $2.66 million in damages to the seven female professors who brought the lawsuit, and additionally increase the 2018 salaries of those professors.
- In the spring of 2018, The Ohio State University agreed to pay a sum totaling over $700,000 to two employees after they alleged age discrimination and retaliation in a lawsuit filed in 2015.3
- In 2010, the University of Louisiana at Monroe was ordered to pay $450,000 to settle an EEOC age discrimination and retaliation lawsuit.2
Prevention and protection
With discrimination front and center in college discourse, prevention and protection should be top of mind for educational institutions. Now is a great time to review employment practices liability insurance (EPLI), including the retentions, policy form language, limits and risk management practices with your educational institution customers.
The EPLI provided by Hanover Education Advantage is designed to help protect colleges and universities from financial damage caused by a claim or lawsuit from within the organization. Keeping current with today’s legal environment, The Hanover’s EPLI policy can help protect universities and their employees with broad coverage for an array of allegations, including discrimination, harassment, retaliation, constructive discharge, termination, failure to hire and negligent supervision. Our Risk Solutions offering also includes an eLearning series designed specifically for educators to help minimize their risk.
1The Hanover Insurance Group claims information
2U.S. Equal Employment Opportunity Commission