Wrongful Termination Claim
What Does Wrongful Termination Claim Mean?
A wrongful termination claim is a formal request for compensation that an employee submits against their employer, alleging that their dismissal was for an unlawful reason. This claim seeks damages such as lost wages and other expenses resulting from the termination.
Insuranceopedia Explains Wrongful Termination Claim
A termination is deemed “wrongful” when an employer dismisses an employee for illegal reasons, such as violations of anti-discrimination laws, breaches of oral or written agreements, or contraventions of labor laws. Employers found guilty of such actions may face statutory penalties, depending on the specific violation.
To mitigate these risks, many employers invest in Employment Practices Liability (EPL) insurance policies. These policies provide coverage not only for wrongful termination claims but also for other employment-related issues, including sexual harassment, negligent evaluation, and discrimination based on race or gender.
