WITH CONFRONTATIONS between angry customers and employees increasing during the COVID-19 pandemic, employers need to have policies in place to protect workers who are confronted.

Many customer-facing companies – retailers, restaurants, etc. – have seen an uptick in customers sexually harassing employees or racially attacking them. Even workers who don’t interact with customers or vendors face to face can be be harassed: on the phone, through text messages or social media.

But there is also a larger risk to your organization: If you are not doing all you can to protect your staff against harassment by customers or vendors, you could be sued for those failures.

The typical employment practices liability insurance (EPLI) policy only covers costs related to claims of harassment, discrimination and other workplace ills perpetrated by company insiders. It won’t cover complaints about customer or vendor harassment. But, there is a rider that will cover these claims: third party EPL coverage.

To protect your company from an employee lawsuit, you must first safeguard your workers.


You should implement policies and procedures that address discrimination and harassment issues, both from the standpoint of an employee’s actions and the actions of third parties.

What Policies, Training Should Cover discrimination.

  • How employees should handle the situation when a customer is harassing or threatening them, including de-escalating techniques.
  • Procedures for employees to report harassment.
  • Having staff experiencing harassment say a safety word to a nearby worker to alert them of the situation, so another worker or manager can take their place or intervene.
  • Encouraging staff to report to their manager if a certain customer continues harassing them each time they come in.
  • Emphasizing the fact that you won’t retaliate against staff who complain about a threatening client or vendor.
  • Calling law enforcement if a customer’s anger and actions are escalating.
  • Training your employees to walk to their cars in groups after their shifts for safety reasons after a confrontation during their shift.

Employees must be periodically retrained through departmental meetings. To maintain the effectiveness of departmental training sessions, be sure that supervisors are provided with copies of all policy updates and procedural changes.


Insurance companies are increasingly requiring employers to implement discrimination and harassment prevention policies and employee training on the subject before they will issue a policy.

An employer is liable for third party harassment or discrimination just as it would be for harassment by a co-worker – that is, the employer is liable if its behavior regarding the harassment is negligent.

Negligence means that the employer knew or should have known of the harassment and failed to take appropriate corrective action.

As mentioned, a typical EPLI policy won’t cover your legal expenses, settlements or court judgments if the harasser is a customer or vendor. For that you would have to purchase third party EPLI.

These policies cover your firm if you’re sued by an employee over:

Harassment by an outsider. This can include unwanted sexual advances or requests for sexual favors. Both verbal and physical conduct, as well as other forms of harassment that create a hostile or offensive work environment, are covered. Some policies also cover accusations of mental anguish, emotional distress, humiliation and assault.

Discrimination by an outsider. This includes discriminatory practices against one of your staff based on their race, religion, age, sex, national origin, disability, pregnancy or sexual orientation (such as a customer refusing to be served by someone because of their race).

In some cases, EPLI carriers may not provide third party coverage to firms with a high potential for claims. Instead, they might offer limited coverage, like accusations of discrimination, but not harassment claims.

If you have staff dealing with customers regularly, this kind of insurance can protect your firm in case you are sued by a staff member for not doing enough to prevent customer harassment or discrimination.

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