fbpx

Book an appointment here

Employment disputes insurance

Get the right cover from top insurance companies

Or call us on 0800 374 691

WE WORK WITH TRUSTED A-RATED INSURANCE COMPANIES

Frequently asked questions about employment disputes insurance

Employment disputes insurance is one of the most common types of policies businesses seek in New Zealand. We’ll answer some of the most frequently asked questions.

Employment Disputes Insurance Requirements and Coverages

Employment disputes insurance is multifaceted, encompassing several elements. Here are four key aspects:

What is employment disputes insurance?

This insurance provides protection against the costs and potential damages associated with defending your business in the event of employment disputes, such as unfair dismissal claims, wrongful termination claims, or allegations of workplace harassment or discrimination.

What does employment disputes cover?

Coverage typically includes legal fees, court costs, and any settlements or damages awarded to the claimant. 

What doesn’t employment disputes insurance cover?

Exclusions often include claims arising from intentional wrongdoing, illegal activity, or any punitive or multiplied damages awarded by a court. Also, it generally doesn’t cover disputes that started before the policy was taken out, known as “prior acts”.

Who needs employment disputes insurance?

Any business that has employees should consider this insurance. It’s not industry-specific; if you have staff, you could face an employment dispute.

Employment disputes insurance in New Zealand

What is unique about employment disputes insurance in New Zealand?

Employment disputes in New Zealand are governed by the Employment Relations Act 2000, which has a focus on promoting good faith behaviour. The Act underscores the importance of open communication, mutual obligation of trust and confidence, and a balanced approach to dealing with employment matters.

One unique characteristic of the New Zealand system is the Employment Relations Authority (ERA), an organisation that investigates employment relationship problems. If an issue arises that cannot be resolved through mediation, the ERA will investigate and make a legally binding decision.

Employment disputes insurance in NZ takes into account the unique legislative framework and the potential for disputes to escalate to the ERA. It’s therefore designed to cover the costs associated with defending claims, not just in court, but throughout the dispute resolution process.

Is employment disputes insurance compulsory in New Zealand?

Employment disputes insurance is not a compulsory requirement for businesses in New Zealand. However, it is strongly recommended for any business that employs staff. Even with the best management practices, there’s always a risk of disputes that can result in significant legal costs and potentially damaging awards. Having employment disputes insurance provides a financial safety net and peace of mind.

Is employment disputes insurance expensive in New Zealand?

The cost of employment disputes insurance typically varies from $60 to $120 per month however can vary significantly depending on the size of your business, the industry you operate in, and the number of staff associated with your operations. 

How Do You Buy Directors and Officers Insurance with Gerrards?

How to Buy Employment Disputes Insurance with Gerrards

Securing employment disputes insurance with Gerrards is a straightforward process. Here are some essential steps:

How long does it take to buy employment disputes insurance through us?

We understand that time is a valuable asset for any business. That’s why at Gerrards, we aim to provide multiple quotes from top insurers within 24 hours or less. We also offer advice about coverage limits and help identify the best fit for your business.

What is an employment disputes insurance certificate?

Once you have chosen and secured your policy, we will issue an insurance certificate. This document serves as proof of your insurance coverage. It outlines your policy details, including the type of coverage, the policy term, and the insurer. The certificate is an important document and should be kept in a safe place.

What industries do we offer cover for?

Gerrards caters to businesses across a wide spectrum of industries. Whether you operate in retail, construction, hospitality, or any other sector, we can help you find the right policy. No industry is too niche or too complex for us.

How much employment disputes insurance do I need?

Determining the right amount of employment disputes insurance can be tricky. It largely depends on the nature and size of your business, the number of employees you have, and the level of risk associated with your particular industry. At Gerrards, we can guide you through this process. We’ll take into account your specific circumstances and help you identify the level of coverage that will best protect your business.

Employment disputes insurance claims

How Do I Make a Employment Disputes Insurance Claim?

If you need to make a claim, reach out to us. We will liaise with the insurance company, advocating for you throughout the process.

What are Some Common Employment Disputes Claims?

An employee, let’s call him John, worked for a tech startup. John was let go suddenly without any prior notice or clear reasoning. John felt the dismissal was abrupt and unjust, leading him to lodge an unfair dismissal claim. His employment disputes insurance helped his employer cover legal fees and potential compensation costs during the dispute.

Maria, an employee at a retail store, believed she was consistently passed over for promotions because of her age. Despite her strong performance reviews and dedication, younger employees with less experience were promoted instead. Maria filed a workplace discrimination claim. The employer’s employment disputes insurance would cover the costs of defending against this claim and any resulting settlement.

David, working in a corporate office, experienced unwanted advances from a senior colleague. After reporting the incidents to HR and seeing no action taken, David decided to file a sexual harassment claim. His employer’s employment disputes insurance could cover the legal costs and any awarded damages.

Anna, an employee at a design firm, was terminated while on maternity leave. She had been assured her job was secure during her absence. Believing her termination violated her rights, Anna filed a wrongful termination claim. The employer’s employment disputes insurance policy could respond to such a claim, covering legal costs and potential damages.

Is employment disputes insurance worth is?

There are significant pros and cons to weigh up when considering employment disputes insurance.

Pros

  1. Financial Protection: The primary benefit of employment disputes insurance is the financial protection it provides. Legal fees, settlement costs, and court-awarded damages can escalate quickly, potentially causing financial stress or even bankruptcy. This insurance covers those costs, providing financial stability.

  2. Legal Support: Insurance often includes access to legal professionals who specialize in employment disputes. Their expertise can be invaluable in navigating complex employment laws and processes.

  3. Risk Management: Having insurance encourages businesses to implement robust HR practices and risk management strategies to avoid claims. This can result in better working environments and relationships between employers and employees.

Cons

  1. Cost: The main downside of employment disputes insurance is the cost of premiums. Some businesses may find the cost prohibitive, particularly if they have a low risk of employment disputes.

  2. Not Comprehensive: Employment disputes insurance doesn’t cover all employment-related incidents. Claims related to intentional acts, illegal activities, or disputes that began before the policy period are typically excluded.

  3. Moral Hazard: There’s a potential risk that having insurance could lead to complacency in maintaining sound HR practices. Some employers may think that because they have insurance, they don’t need to focus on preventive measures.

Employment disputes policy changes

What Happens If I Need to Change My Insurance Later?

If you need to change your policy, contact us. We can guide you through the process of updating your employment disputes coverage to better fit your business’s evolving needs.

What Happens If I Cancel My Directors and Officers Policy?

Cancelling your policy could leave your business exposed to potential risks, so it’s crucial to have a new plan in place before making such a decision.

How does employment disputes insurance compare with other policies? 

While both provide protection against workplace issues, employers liability typically covers bodily injury or illness, whereas employment disputes insurance covers legal disputes with employees.

D&O insurance covers claims made against directors and officers for alleged wrongful acts in their managerial capacities, while employment disputes insurance focuses on claims from employees regarding their employment.

Public liability covers claims of bodily injury or property damage to third parties due to your business activities. In contrast, employment disputes insurance covers legal disputes with employees.

Do you have further questions about employment disputes insurance NZ?

We hope this guide has shed light on the intricacies of employment disputes insurance in New Zealand. However, we understand that every business is unique, and you might still have questions specific to your situation. At Gerrards Insurance Brokers, we’re here to help. If you have any further queries about employment disputes insurance, or any other insurance need, please don’t hesitate to contact us. Our team of experienced professionals is always ready to provide personalised advice and solutions tailored to your business. 

What our clients are saying: