Employment Practices Liability

The number of workplace discrimination and harassment charges filed with the U.S. Equal Employment Opportunity Commission  (EEOC) during Fiscal Year 2019 (which ended September 30, 2019) declined to the lowest level since at least FY 1997 (the earliest year reported on the agency’s website), according the EEOC’s recent statistical release. The number of charges overall had also declined in the 2018 fiscal year, but in 2018, the number of sexual harassment charges had increased, apparently in response to  the #MeToo movement. However, in FY 2019, the number of sexual harassment charges also decreased as part of the overall decrease in the number of charges, suggesting that the impact of the #MeToo movement diminished during the most recent fiscal year. The agency’s January 24, 2020 press release about the charge statistics can be found here. The agency’s enforcement and litigation statistics can be found here.
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John M. Orr
Jully Y. Rojas

As many readers undoubtedly are aware, California’s governor recently signed into law legislation that would re-classify app-based workers as “employees” rather than as “independent contractors. As discussed below in a guest post written by John M. Orr and Jully Y. Rojas, these recent changes in California law could have national significance. The changes could have significant Employment Practices Liability Insurance implications as well. John is a Director in Willis Towers Watson’s FINEX (Financial, Executive & Professional Risk) division. Jully is a member of FINEX’s Claims & Legal Group. Both are resident in the firm’s San Francisco office. The authors wish to thank Talene Carter, Willis Towers Watson’s Employment Practices Liability product leader, for her insights and guidance. A version of this article previously appeared on the Willis Towers Watson site. I would like to thank John and Jully for their willingness to allow me to publish their article as a guest post on this site. I welcome guest post submissions from responsible authors in topics of interest to this site’s readers. Please contact me directly if you would like to submit a guest post. Here is John and Jully’s article.
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In the following guest post, Kelly Johnson of Hiscox USA and  James Talbert and Elan Kandel of Bailey Cavalieri took a look at a recent judicial decision addressing the question of whether a wage and hour claim represents an employment related misrepresentation within the meaning of an Employment Practices Liability Insurance policy. I would like to thank Kelly, James, and Elan for allowing me to publish their article as a guest post on this site. I welcome guest post submissions from responsible authors on topics of interest to this blog’s readers. Please contact me directly if you would like to submit a guest post. Here is Kelly, James and Elan’s article.  
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As I have noted in prior posts (for example, here), a few plaintiffs’ law firms have launched a wave of lawsuits under the Americans with Disabilities Act (ADA) based on website inaccessibility allegations. In one of the first appellate court decisions on the legal issues these cases present, the Ninth Circuit recently reversed a lower court dismissal of a website and mobile app accessibility lawsuit that had been filed against Domino’s Pizza. The appellate court’s ruling underscores the exposures companies face for these kinds of lawsuits. The Ninth Circuit’s January 15, 2019 opinion in Robles v. Domino’s Pizza can be found here.
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Eric Scheiner
Jennifer Broda

As I have extensively noted on this blog, one of the most important recent developments in the management liability and insurance arena has been the emergence of the #MeToo movement, along with its revelations of sexual misconduct and accompanying claims. In the following post, Eric Scheiner and Jennifer Quinn Broda, partners at Kennedys CMK’s Chicago office, take a look at the evolving #MeToo movement and the implications of the movement’s  evolution both with respect to claims and with respect to insurance coverage. I would like to thank Eric and Jennifer for their willingness to allow me to publish their article as a guest post on this site. I welcome guest post submissions from responsible authors on topics of interest to this blog’s readers. Please contact me directly if you would like to submit an article. Here is Eric and Jennifer’s article.
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Machua Millett

My recent post about wage and hour exposure and insurance triggered an email exchange with one of the blog’s readers, Machua Millett, who is the Chief Innovation Officer for the financial and professional unit (FINPRO) at Marsh.  The email exchange involved a lot of information that we both agreed might be of interest to all of the blog’s readers. Rather than try to turn the email correspondence into a blog post, we reconstructed the exchange in the form of a Q&A, which is set out below. I would like to thank Mach for reaching out to me in the first place, for his willingness to share ideas and information, and for his willingness to participate in the Q&A, below. My questions are set out in italics, Mach’s answers to each question follow. 
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In a May 16, 2018 press release (here), Michigan State University announced that its board of trustees has approved a settlement in which the university agreed to pay MSU doctor Larry Nassar’s sexual assault victims a total of $500 million. There are a number of noteworthy features to this settlement agreement, beyond just its sheer size. Among other things, the school does not yet know for sure how it is going to fund the settlement.
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At the start of the New Year, it has been interesting finding out more about the massive tax legislation that Congress enacted in December. It has been interesting to see the various impacts that the legislation is having on a variety of companies. It has also been interesting to learn more of the details about what Congress actually enacted. For example, here’s a detail about the tax bill that I didn’t previously know about – apparently the tax legislation includes a provision specifying that employers can no longer include as a deduction on their tax returns amounts the employers pay in settlement and defense of sexual misconduct claims, if the settlement is subject to a nondisclosure agreement.
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In the current litigation environment, employers face an ongoing threat of claims brought by employees alleging violations of wage and hour laws, often filed as class actions. These kinds of lawsuits can be expensive to defend and to resolve. In general, management liability insurers try to avoid providing coverage for these kinds of claims, except for very limited amounts of defense cost coverage. A recent district court decision holding that the management liability insurance policy of the women’s clothing retailer Talbots did not cover a wage and hour class action lawsuit pending against the company illustrates the barriers policyholders face in attempting to secure coverage for these kinds of claims. Both the policy language at issue and the outcome of the Talbots insurance coverage dispute arguably are unremarkable. However, the outcome does raise questions about whether there might be ways for policyholders at least to obtain effective defense cost coverage for these kinds of claims.
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sup ct 4In the flurry of opinions and orders on Monday on the final day of the U.S. Supreme Court’s term, and amid the hubbub over the Court’s action on the Trump administration travel ban order, you might well have overlooked the fact that on Monday the Court also agreed to take up the question of whether or not the Dodd-Frank Act’s anti-retaliation provisions apply to and protect individuals who did not make a whistleblower report to the SEC. The lower courts have struggled with the question of whether or not the anti-retaliation protections extend to individuals who file internal reports within their own companies. A split on the issue has developed and now the U.S. Supreme Court will have the opportunity to address the question in the case of Digital Realty Trust v. Somers. The Court’s June 26, 2017 order granting Digital Realty Trust’s petition for a writ of certiorari can be found here.
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