Understanding Employment Practices Liability Coverage



As ministries grow, the need to hire employees grows as well. With this comes the need for proper employment practices, policies, and protections. As a leader in providing risk management, the United Methodist Insurance Program (UMIP) helps you understand Employment Practices Liability coverage and how to protect your ministry with its employment practices. 

The purpose of Employment Practices Liability coverage is to help protect an organization and its leadership against civil liability for “Wrongful Acts" including its directors and officers such as clergy, church officers, church employees, and boards and leaders of church-related institutions. Lawsuits regarding employment practices are rising, and while most of those lawsuits are against larger corporations, no organization is immune to these types of lawsuits. This type of coverage can help to provide your ministry a firm financial footing against the costs of defending a lawsuit in court and judgments or settlements - whether you win or lose the case. This coverage is included in the property and casualty coverage offered by UMIP. The “Wrongful Acts” covered under this type of policy may include: 

  • Wrongful termination 

  • Allegations of discrimination 

  • Harassment 

  • Retaliation 

  • Misrepresentation to an applicant 

  • Libel, slander, and defamation 

  • Failure to employ 

  • Deprived opportunity 

  • Wrongful evaluation or demotion 

  • Wrongful discipline 

  • Failure to enforce policy 

Having this coverage is essential for any ministry that has employees, but steps can be taken to help prevent these incidents. Here is a list of these steps and some suggestions on how to properly handle “Wrongful Acts”:  

  • Understand current employment laws enforced by the U.S. Equal Employment Opportunity Commission

  • Make sure your employee handbook is thorough in detailing your ministry's workplace policies and ensure each employee confirms in writing that they have read and understand the handbook. 

  • Create job descriptions for each position that effectively communicate expectations, skills, and performance. 

  • Screen potential hires to vet out unsuitable candidates before making official contact with them. 

  • Conduct background checks on suitable applicants. 

  • Institute a zero-tolerance policy regarding discrimination, all forms of harassment, and bullying. 

  • If an incident is reported, document everything that occurs and the steps your ministry took to solve that incident and actions taken to prevent future issues. 

Taking these steps will help to ensure your ministry is actively protecting itself and its leaders against “wrongful act” incidents and lawsuits. 

Looking for employment practices liability insurance coverage for your church?  Suracy Faith, our trusted partner, offers property and casualty insurance, including employment practices liability coverage, to United Methodist churches.  Suracy Faith offers access to carriers that have experience serving religious organizations and provides an understanding of the challenges churches face.  Call 866-203-0777 or email UMIP@suracy.com to request a quote or learn more about insurance solutions from Suracy Faith.  

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The content available on this website has been prepared by United Methodist Insurance Company (UMI) for informational purposes only. No article or document may accurately contemplate all possible scenarios or church resources. As such, this information is meant to foster discussion by the individual church and its members to develop a plan tailored to its own circumstances. UMI is providing this information with no warranties or guarantees of any kind and it should not be viewed as legal, financial, or other professional advice. All liability is expressly disclaimed. Any claim examples described herein are general in nature, may or may not be based on actual claims, and are for informational purposes only. Any coverage available for a claim is determined from the facts and circumstances of the claim as well as the terms and conditions of any applicable policy, including any exclusions or deductibles. In the event of a conflict with the content herein, the terms and conditions of any issued policy will control. Individual coverage may vary and may not be available in all states.

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