May was Mental Health Awareness Month in the United States, which focuses on an issue that millions of Americans face and must deal with. That includes employers and employees, since actions taken in response to mental health-related requests and accommodations in the workplace can lead to employment practices liability claims. To discuss these challenges, we recently connected with Chris Williams, Employment Practices Liability Product Manager at Travelers.
Are mental health-related issues leading to more workplace discrimination claims?
There has been quite a jump in disability discrimination claims filed with the U.S. Equal Employment Opportunity Commission. From 2021 to 2024, the number of those claims increased 47%, from 22,843 to 33,638. Drilling down a little deeper, charges alleging disability discrimination based on anxiety disorder, depression, and post-traumatic stress disorder increased a similar percentage during that same time period.
Why has this happened? I think there is more general awareness of mental health issues, not only in society at large but also in the workplace. Studies have shown this. According to the National Alliance on Mental Illness, approximately 1 in 5 adults in the United States, or 57.8 million people, experience an occurrence of mental illness each year. The Occupational Safety and Health Administration said that more than 80% of workers have reported experiencing workplace stress. And while stress doesn’t always have a negative impact on mental health, it can, and it can exacerbate mental health issues.
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There are a lot of people who are dealing with and suffering from mental health conditions. That can impact the workplace, which can lead to more discrimination claims.
What can companies do to avoid mental health-related claims?
Employers can take a number of steps to help reduce the likelihood of facing an Employment Practices Liability (EPL) claim involving mental health. First off, have a written policy in place that complies with the Americans with Disabilities Act (ADA) and the Family Medical Leave Act (FMLA), as well as any state statutes. The ADA makes it unlawful to discriminate in all employment practices against a qualified employee or job applicant with a disability, and that includes recruitment, pay, hiring, firing, layoff, benefits, promotions, and all other employment-related activities.
In order to be protected by the ADA, an individual with a disability must be qualified to perform the essential functions of the job with or without reasonable accommodations. The FMLA requires employers to give workers up to 12 weeks of FMLA leave each year, continue an employee’s health benefits during that leave, and restore the employee to the same or identical position at the end of the period.
In addition to creating a written policy – and following it – employers should consider offering medical coverage that includes mental health concerns, educate employees on how to request a workplace accommodation, train employees (managers included) on how to recognize the requests, and hold discussions with the employee on how best to address the issues.
If a company wants to take disciplinary action against an employee, especially someone who has disclosed mental health concerns, it should exercise caution and consult with counsel before taking that action, up to and including termination.
How does EPL insurance help?
Insurance carriers work closely with agents, brokers and customers to offer policyholders an assortment of products and services that best suit their needs. If faced with an EPL claim, a company that has secured EPL insurance can be protected, because it helps provide coverage for defense costs and damages related to various employment-related claims, including allegations of wrongful termination, discrimination, workplace harassment and retaliation.
In addition, EPL insurers provide risk management content to their customers, including sample policies, training and a helpline to address general employment questions.
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