Employment Practices Liability Insurance (EPLI) is typically associated with claims brought by employees against their employers—allegations like wrongful termination, harassment, or discrimination. However, a growing and often overlooked exposure comes from third-party EPLI claims. These claims arise when non-employees—such as customers, vendors, or clients—allege misconduct by a company’s employees.
As businesses interact with the public more frequently, especially through digital channels, third-party EPLI risks are evolving. One notable trend is the sharp rise in accessibility-related claims tied to website compliance under the Americans with Disabilities Act (ADA).
What Are Third-Party EPLI Claims?
Third-party EPLI claims involve allegations made by individuals who do not work for the company but claim they were harmed by the company’s employment practices. These claims typically center around inappropriate behavior, discrimination, or failure to accommodate.
Unlike traditional EPLI claims, which are internal, third-party claims expand liability outward—often into customer-facing interactions and digital experiences.
When Do Third-Party Claims Occur?
Third-party EPLI claims can arise in a wide variety of situations, including:
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Customer interactions: A customer alleges they were harassed or discriminated against by an employee in a retail store, restaurant, or service environment.
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Vendor relationships: A contractor or vendor claims they were subjected to a hostile environment while working with your team.
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Public-facing services: Any business that regularly interacts with the public—hospitality, healthcare, financial services—is especially exposed.
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Digital engagement: Increasingly, claims stem from how businesses interact online, including website accessibility and communication barriers.
Common Types of Third-Party EPLI Claims
Third-party claims generally fall into several key categories:
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Harassment
Non-employees may allege inappropriate conduct by staff, including verbal abuse, offensive comments, or unwanted behavior during interactions. -
Discrimination
Claims may arise if a customer or client believes they were treated unfairly based on protected characteristics such as race, gender, religion, or disability. -
Failure to Accommodate
Businesses may be accused of failing to provide reasonable accommodations to individuals with disabilities, whether in physical locations or digital spaces. -
Retaliation
If a third party raises a concern or complaint and experiences adverse treatment afterward, retaliation claims may follow.
The Rise of ADA Website Accessibility Claims
One of the fastest-growing areas of third-party EPLI exposure involves website accessibility. Courts have increasingly interpreted the ADA as applying to digital properties, meaning company websites must be accessible to individuals with disabilities.
Why This Is Happening More Often
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Digital-first business models: More transactions and services are conducted online than ever before.
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Increased awareness: Advocacy groups and individuals are more aware of accessibility rights.
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Legal precedent: Courts have been more willing to hear and rule on website accessibility cases.
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Ease of enforcement: Plaintiffs can identify non-compliant websites quickly using automated tools.
Common Website Accessibility Issues
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Lack of screen reader compatibility
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Missing alternative text for images
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Poor color contrast
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Inaccessible forms or navigation
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Videos without captions
These issues can prevent individuals with disabilities from accessing services, leading to claims of discrimination under the ADA.
Why Businesses Should Pay Attention
Third-party EPLI claims can be costly—not only in legal expenses but also in reputational damage. ADA website claims, in particular, often result in settlements, remediation costs, and ongoing compliance obligations.
Moreover, many businesses mistakenly assume their EPLI policy automatically covers third-party claims. In reality, coverage often requires a specific endorsement.
Risk Management Strategies
To reduce exposure to third-party EPLI claims, businesses should consider:
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Training employees on appropriate conduct with customers and third parties
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Implementing clear policies for handling complaints from non-employees
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Reviewing EPLI coverage to ensure third-party claims are included
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Conducting website accessibility audits and aligning with recognized standards like WCAG (Web Content Accessibility Guidelines)
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Engaging accessibility experts to remediate digital barriers proactively
Third-party EPLI claims represent a growing liability that reflects how businesses operate today—interconnected, customer-facing, and increasingly digital. The surge in ADA website accessibility claims highlights the importance of extending compliance and risk management beyond the workplace and into every touchpoint a business has with the public. Organizations that take a proactive approach—both in employee conduct and digital accessibility—will be better positioned to mitigate risk and foster more inclusive experiences for everyone.
