Don’t think that the answer is simply “yes.” A business’ action may depend upon circumstances such as whether an employee’s duties involve driving a company vehicle or directly involves customers and if the company can prove that such behavior fails to meet the applicable job standards.
One key issue is having access to legal counsel that has expertise in this special area of the law. Another key issue is documenting the essential job functions and establishing measurable standards for each position. Use of regular performance reviews and applying the standards equally to each employee is a smart employment practice. The best defense against employment practice claims is to know the law in your state and then having policies and procedures that meet or exceed its legal standards.
Policies and premiums for this type of coverage vary tremendously among insurers. Many companies offering the coverage also offer assistance in writing policy and procedure manuals and other ways to reduce the potential for claims involving sexual harassment, wrongful termination, or discrimination. No business is immune from these claims.