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Employment Discrimination Lawsuits Are Increasing, Is Your Cannabis Businesses Protected?

According to the EEOC, employment discrimination lawsuits are on the rise. While an employer has the right to fire an employee for certain "just causes," for example, not showing up to work, frequent mistakes, inappropriate behavior, etc., discrimination does occur whether or not the employer realizes they are discriminating or not.

Title VII is the Federal Civil Rights Law that prohibits employment discrimination on the basis of race, color, gender, national origin, and religion. Sexual harassment falls under Title VII as well and connections for sexual harassment and employment discrimination are typically tied to gender.

Why is employment discrimination rising in the cannabis industry, in particular, and what can businesses do about it?

There are multiple reasons why there are increased law suits. One of the main reasons is awareness. Title VII is more than 50 years old, and many people are just unaware of what the laws mean or say. As information spreads about what employees rights actually are, the employees' ability to recognize discrimination - past and present - increases.

There is also increased coverage of employment discrimination in the news media. The news is on a 24 hour cycle that must be filled with information. News outlets are reporting more on the outcomes of not only major corporations but also government entities, and sometimes even small businesses as well. All of these factors bring greater awareness. So, while there many not be an increase in discriminatory behavior per se, there is an increase in the amount reported and claims filed against employers.

How can cannabis business owners protect themselves from employee-related discrimination lawsuits?

The answer is by having Employers' Protection Liability (EPLI) coverage as part of their insurance policy. EPLI is a type of insurance aimed at protecting companies and their business owners from legal action that arises out of certain employment practices. In addition to wrongful termination claims, EPLI insures against claims made based on discrimination against sex, age, race, disability, or sexual misconduct. If you are involved in a lawsuit, your EPLI will cover judgments, settlements, and defense expenses up to the specified policy limits for a company.

“As you hire more employees, your risk of discrimination and sexual harassment increases, an EPLI policy can help your legal defense and settlement of such claims,” states Eric Rahn of S2S Insurance Specialists. "In today's climate, business owners and managers need to be proactive and understand the risk management tools and options available to them to protect their business."


S2S Insurance Specialists insures the most difficult risks facing your company and is a leading provider of EPLI Insurance. To learn more about how we can protect you and your business, contact Eric Rahn at or schedule a free 15-minute consultation by clicking here.


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