1.     The growing use of digital tools increases employment liability 

The pandemic has cast a long shadow on problematic social behaviours - for Canadians who encountered harassment, violence, and sexual harassment, their experiences increased in severity (26 percent), frequency (25 percent), and duration (20 percent).^[1] As remote work became more common, so did the risk of digital miscommunication – almost 90 percent of Canadian workers now experience team conflicts due to difficulties with digital tool usage. De-risking this from an employment liability perspective requires time and resources invested in appropriate training and compliance. 

2.     Shifting work models put additional pressure on management

As hybrid work arrangements continue gaining ground, so do potential frictions surrounding interpretations of ‘duty to accommodate’ remote work due to disability, family circumstances or other factors. Here, adhering to employment standards, record-keeping obligations, updating employment contracts and policies adds to the already heavy managerial load, with an average manager tasked with 51 percent more responsibilities than they can effectively manage.^[2]

3.     Managerial skills gap and growing workloads worsen litigation risks 

Workplace conflicts acquire a new dimension when placed into the context of managerial skills gap. While 57 percent of managers say they are fully responsible for resolving their direct reports’ conflicts, nearly half fail to demonstrate effective conflict management skills, and only 12 percent demonstrate high proficiency in this domain.[3] Such state of affairs clearly increases vulnerability to toxic work environments, wrongful behaviours and, ultimately, employee-related litigation.

Even though turnover has stabilized after the Great Resignation, skills gap is an ongoing issue on the Canadian labour landscape and an employment challenge for SMEs.[4] On the managerial front, this is a resounding alarm, as manager replacement often costs around 200 percent of their salary, not to mention the loss of valuable skills, often without appropriate continuity stop-gaps.[5] Once again, the threat of employment-related litigation rears its head in the absence of oversight, disrupted by the managerial transition.

Reflecting on these challenges, executives report a 20 percent decline in work-life balance, a 15 percent drop in satisfaction with working environment, and 40 percent more work-related stress.[6] In this context, Employment Practices Liability Insurance (EPLI) is an effective remedy for reducing litigation risks which can arise in the aftermath of managerial workloads, skill gaps, and retention issues. EPLI is a powerful tool in a managerial toolbox at the time when employment-related risks are higher than ever. 

^[1] Western University, Canadian Labour Congress

^[2] Gartner

^[3] Gartner, Forbes

^[4] Staffing Industry Analysts, The Conference Board of Canada

^[5] Gallup

^[6] Future Forum