Workplace Discrimination Explained

Every employer wants to build a fair and respectful workplace. However, employment-related disputes can arise even when business owners believe they are acting appropriately.

Understanding what workplace discrimination is can help employers make informed decisions, reduce legal risks, and create a positive work environment.

What Is Workplace Discrimination?

Workplace discrimination occurs when an employee or job applicant is treated unfairly because of a legally protected characteristic.

Federal and state laws protect employees from discrimination in many aspects of employment, including hiring, promotions, compensation, training, discipline, and termination.

Not every workplace disagreement is discrimination. To qualify as unlawful discrimination, the action generally must be based on a protected characteristic.

Protected Characteristics

Protected characteristics may include:

• Race

• Color

• Religion

• Sex

• Pregnancy

• National origin

• Age (40 and older)

• Disability

• Genetic information

Some state laws may provide additional protections depending on where your business operates.

Examples of Workplace Discrimination

Examples may include:

• Refusing to hire a qualified applicant because of their age.

• Paying employees differently based on gender for the same work.

• Denying promotions because of race or religion.

• Failing to provide reasonable accommodations for a qualified employee with a disability.

• Treating an employee unfairly because they are pregnant.

Each situation is unique, and whether discrimination occurred depends on the specific facts and applicable laws.

What Is Not Workplace Discrimination?

Not every employment decision is discriminatory.

Business owners may make legitimate decisions based on factors such as:

• Job performance

• Attendance

• Skills and qualifications

• Experience

• Business needs

• Company restructuring

As long as decisions are based on legitimate business reasons and not protected characteristics, they are generally considered lawful.

Why This Matters for Business Owners

Employment discrimination claims can be costly, time-consuming, and disruptive to your business.

Even if an employer ultimately prevails, defending a claim may involve legal fees, management time, and significant administrative effort.

Having clear hiring practices, documented employment decisions, and appropriate insurance coverage can help reduce these risks.

How EPLI Can Help

Employment Practices Liability Insurance (EPLI) may help cover legal defense costs, settlements, and other covered expenses related to employment-related claims, including allegations of workplace discrimination.

Coverage depends on the terms, conditions, and exclusions of the policy.