Employee disputes are listed as a real concern for organizations across a broad spectrum of industries, according to this year’s Norton Rose Fulbright’s Annual Litigation Trends Survey. Nearly 50% of the survey respondents cited labor and employment issues as topping the number of cases their organizations faced in 2013. This not at all surprising considering the stricter regulatory environment we’ve experienced over the last several years and stronger enforcement by the EEOC and other federal and state agencies over anti-discrimination and other employment practices laws.

“We continue to see the scope and frequency of regulatory investigation matters increase in the U.S., as government agencies take a more proactive approach in determining compliance. Stricter regulations governing financial, environmental, and workplace issues create a more complex environment for businesses, and these results show that a serious regulatory investigation is a reality for a growing number of companies each year,” said Otway Denny, U.S. Disputes Head, Norton Rose Fulbright.

The hotel industry just as any other segment is vulnerable to employee-related lawsuits. Moreover, the industry has to be aware of some of the factors that could contribute to a higher risk of litigation, including:

  • There is a considerably higher proportion of minority employees in hotels and restaurant
  • A higher proportion of younger employees in the industry (which can result in a greater frequency of claims under the Age Discrimination and Employment Act)
  • A higher proportion of single female employees, including 78% of restaurant wait staff
  • The labor intensive nature of most jobs in hotels and restaurants
  • An increase in wage-and-hour litigation

To reduce exposures associated with employment-related charges, hotels and others in the hospitality industry must undertake a proactive approach in mitigating their risk. This includes, of course, reviewing management and HR policies and procedures to make sure that they are well documented and defined. It also means training managers and supervisors and fostering a culture of zero tolerance for discrimination, sexual harassment, and other practices. In addition, a well-structured Employment Practices Liability Insurance (EPLI) policy must be secured for all insureds. Be sure that certain coverages are included, such as wage-and-hour claims. Also, review whether part-time, seasonal and temporary employees are included in the coverage, among other factors. IPOA provides EPLI to hotels through HotelPro.

We can provide you with an online premium indication with our easy-to-use fast-track form. With HotelPro, IPOA delivers exclusive hotel insurance programs to agency partners with specifically designed coverage extensions to address limited and full-service establishments. Take a look at our program as well as our EPLI and Data Breach offering to hotels.

Source: Norton Rose Fulbright