EPLI Claims Examples: Real-World Employment Disputes You Should Know

EPLI claims examples highlight the kinds of employment-related lawsuits businesses face—and why understanding real scenarios matters. From wrongful termination and discrimination to retaliation and harassment, these claims can be financially devastating and legally complex. Yet many businesses underestimate the true cost until they’re hit with one. Familiarity with real-world claims isn’t just useful—it’s essential for identifying hidden risks and avoiding costly gaps in coverage.

In this article, we’ll walk through actual EPLI claim scenarios across industries, reveal what triggered them, what they cost, and how you can use these lessons to better protect your business.

Most Common EPLI Claim Types

While employment practices liability insurance (EPLI) covers a wide range of workplace disputes, most claims fall into a few key categories. Understanding these is the first step toward assessing your own exposure.

Core Categories of EPLI Claims

1. Wrongful Termination
   When an employee claims they were fired without just cause or due to unlawful reasons such as age, gender, or whistleblowing.

2. Discrimination
   Allegations based on race, gender, religion, age, disability, or pregnancy. These cases often lead to both financial and reputational damage.

3. Harassment
   Claims stemming from hostile work environments or inappropriate conduct—especially prevalent in the wake of the #MeToo movement.

4. Retaliation
   The most frequently filed EPLI claim in recent years, retaliation occurs when employees are punished for reporting misconduct or asserting their rights.

5. Failure to Hire or Promote
   Allegations that an employer unfairly denied advancement due to bias or unlawful criteria.

Retaliation and harassment claims have surged in both frequency and severity, with average defense costs easily exceeding six figures. Recognizing these patterns helps employers take proactive steps before they become the next case study.

Real‑World EPLI Claims—Case Studies

Understanding how EPLI claims play out in the real world helps demystify the stakes involved. These case studies span industries, business sizes, and claim types—each offering a clear takeaway about the importance of appropriate coverage.

1. Owen Diaz v. Tesla — Racial harassment verdict

Former Tesla worker Owen Diaz was subjected to severe racial harassment at the Fremont factory. A jury initially awarded $137 million (later reduced to ~$3.2 million). This case highlights how hostile workplace conditions can result in enormous claims—even when the plaintiff’s role was not senior.

2. Sunshine Raisin (National Raisin Corp.) — $2M EEOC settlement

In this case, the EEOC settled alleged sexual harassment and retaliation against farmworkers, including persistent complaints ignored by management. The company agreed to a $2 million settlement and mandatory reforms.

3. TaskUs subordinate claims — Confidential Settlement

A former employee alleged sexual harassment and retaliation. The case was settled confidentially after federal denial of forced arbitration. Though the settlement amount isn’t public, its media coverage illustrates how even smaller employers attract costly claims.

4. Juarez v. AutoZone — $185 Million Verdict (Pregnancy Bias & Retaliation)

A landmark case where a former manager was awarded over $185 million for pregnancy discrimination and retaliation—later reduced on appeal—but still one of the largest individual employment verdicts in U.S. history.

5. Dr. Lauren Pinter‑Brown v. UCLA — $13–14 Million Verdict (Gender & Retaliation)

A UCLA cancer specialist was awarded $13 million (later confirmed at ~$14 million in retrial) after her credible complaints of gender discrimination and retaliation.

6. EEOC v. McLane Northeast — $1.675 Million Verdict (Disability Discrimination)

After refusing to interview a qualified Deaf candidate, McLane lost a jury verdict awarding $1.675 million across back pay, emotional distress, and punitive damages.

7. Diana Portillo v. McDonald’s Franchise — $930,000 Verdict (Gender Identity Harassment & Retaliation)

A jury awarded nearly $930K to a transgender former McDonald’s employee subjected to ongoing harassment and wrongful termination under DC Human Rights Act protections.

These cases make it clear: EPLI claims aren’t just about large corporations. Even small businesses and nonprofits face risks that can threaten their operations. Proper coverage can mean the difference between recovery and ruin.

Patterns and Emerging Trends

Behind every EPLI claim is a shifting landscape of workplace expectations, regulatory changes, and social movements. Understanding where claims are heading is just as important as knowing what’s common today.

Key Trends to Watch

• Retaliation Claims Are Surging
  Retaliation is now the most frequently filed employment-related claim, often tied to whistleblower complaints or employees asserting their legal rights.

• Gig Economy & Classification Disputes
  As businesses rely more on freelancers and contractors, lawsuits over employee misclassification are on the rise—especially in states like California with stricter standards.

• Age, Gender & Bias Allegations
  Bias-related claims—especially around age, gender, and pay equity—continue to gain momentum, often leading to protracted legal battles even in companies with formal policies.

• New Legal Frontiers
  Emerging state laws around medical marijuana use, remote work entitlements, and reproductive rights are fueling a new class of disputes employers must navigate carefully.

The Financial Reality

The average EPLI claim now costs $160,000, with jury awards averaging $217,000—and both numbers are climbing due to longer resolution timelines and higher defense costs.

Employers must stay ahead of evolving employment laws and proactively update their policies, training, and documentation practices to mitigate rising claim risks.

What These Claims Reveal About Coverage Gaps

The real-world EPLI claims we’ve seen don’t just highlight legal risks—they expose where many policies fall short. Businesses often assume they’re fully protected, only to discover exclusions or technicalities that leave them exposed.

Common Coverage Gaps

• Wage and Hour Violations: Most standard EPLI policies exclude overtime, misclassification, or meal break disputes unless you add a specific endorsement—with sublimits that may be low.

• Third-Party Claims: If a customer or vendor alleges harassment or discrimination, it’s not always covered unless a third-party extension is included.

• Failure to Accommodate: Claims tied to disability or pregnancy often hinge on whether the employer followed a proper interactive process—many policies exclude these unless well-defined.

• Negligent Hiring or Supervision: These can fall through the cracks if your policy doesn’t include broad-based entity coverage.

Structural Issues That Limit Protection

• Claims-Made Format: If the incident happened before your retroactive date—or wasn’t reported within the required window—you may not be covered.

• Defense Clauses: Some policies treat legal defense as part of the limit, quickly depleting available funds.

To truly protect your business, it’s critical to review endorsements, sublimits, and defense provisions—and tailor the policy to your actual risks.

Industry-Specific Risk Scenarios

EPLI risk isn’t one-size-fits-all. Different industries face different exposures—both in the types of claims and the potential financial fallout. Understanding these nuances helps businesses tailor coverage limits and endorsements more effectively.

Comparative Risk Snapshot by Industry

Coverage Considerations

• Law Firms & Professional Services: Often face complex claims involving multiple parties or legal nuances. High-limit EPLI with strong legal defense provisions and prior-acts coverage is essential.

• Nonprofits & Small Businesses: Limited HR resources can lead to inconsistent policy enforcement—raising risk. These organizations benefit from policies that include broad definitions of “employee” and strong retaliation protection.

• Retail/Hospitality: Daily customer interaction creates third-party exposure. Many standard policies don’t include third-party EPLI unless explicitly endorsed.

Bottom Line: Your industry matters. So should your coverage structure. Use risk benchmarks to inform both policy limits and the need for specific endorsements.

Actionable Risk Mitigation Steps

The EPLI claims we explored offer more than cautionary tales—they reveal what proactive businesses can do to avoid ending up in court. Here’s how to turn those lessons into action.

• Establish Clear HR Policies and Documentation
  In the nonprofit wrongful dismissal case, lack of consistent performance records made the employer vulnerable. Regular documentation and updated handbooks help demonstrate lawful intent.

• Conduct Bias and Harassment Training
  The boutique agency harassment claim could have been prevented with manager training and early intervention. Annual sessions build awareness and create accountability.

• Implement Interactive Accommodation Practices
  In the manufacturing disability claim, failing to engage in the interactive process triggered legal exposure. Clear ADA accommodation workflows are critical.

• Classify Workers Correctly and Track Compliance
  The rise of misclassification claims, especially in the gig economy, makes it essential to distinguish contractors from employees and comply with wage/hour laws.

• Add Third-Party and Wage/Hour Endorsements
  For retail and hospitality businesses, adding these often-excluded coverages ensures protection in customer-facing environments.

Proactive policies, proper training, and the right endorsements won’t eliminate EPLI claims—but they can significantly reduce the likelihood and cost.

How Old Harbor Helps Businesses Navigate EPLI Risk with Real-World Insight

EPLI coverage isn’t just about having a policy—it’s about having the right policy, informed by the realities of your industry and workforce. That’s where Old Harbor Insurance Services brings uncommon value.

Informed by Real Claims

Old Harbor works closely with businesses to assess actual claim exposure, drawing on real-world cases and trends to guide decision-making. Whether you’re in hospitality, professional services, or the nonprofit space, their advisors consider factors like employee count, turnover, third-party exposure, and state-specific laws to design protection that fits.

Tailored Policy Structuring

They don’t just plug you into a one-size-fits-all policy. Old Harbor evaluates endorsements, reviews wage/hour exclusions, and helps structure proper per-claim and aggregate limits. They also guide clients on third-party extensions, prior-acts coverage, and defense handling clauses—critical elements often missed.

Ongoing Risk Partnership

With Old Harbor, EPLI isn’t a once-a-year renewal task. It’s an evolving partnership. They revisit coverage annually, adapt to legislative changes, and stay ahead of emerging risks so your protection grows with your business.

For employers who want to move beyond generic policies and into smart, risk-aligned coverage—Old Harbor is the advisor you want in your corner.

Real Claims, Real Lessons—Now It’s Your Move

EPLI isn’t theoretical. The claims are real, the costs are steep, and the consequences can derail even well-run businesses. By studying real-world EPLI claims examples, you gain more than awareness—you gain foresight. From wrongful termination to third-party harassment, the patterns are clear, and the solutions are actionable. The right policy, with the right limits and endorsements, can be the difference between business continuity and crisis.

If you’re ready to assess your exposure and design smarter protection, reach out to Old Harbor Insurance Services—they’ll help you turn insight into insurance that actually works.