When does a restaurant need EPLI?

Once a restaurant group has fifteen or more employees, employment practices liability insurance should at least be priced. Fifteen is where federal discrimination law starts to apply, and a growing group passes it quickly. EPLI pays defense costs and settlements for claims like discrimination, harassment, retaliation and wrongful termination. Wage-and-hour claims are usually excluded or limited to defense costs, so that is the line to read on any policy.

What it pays for

Employment practices liability answers claims brought by employees and job applicants about how they were treated: discrimination, harassment, retaliation, wrongful termination, a promotion denied. It pays the defense and a settlement or judgment up to the limit.

General liability does not do this. It is written for injuries and damage to people outside the business, and claims by employees about employment decisions sit outside it.

Why fifteen employees

Title VII, the federal discrimination law, applies to employers with fifteen or more employees, and federal age discrimination law applies at twenty. Some states apply their own employment laws at much lower head counts. A restaurant group with two or three stores is usually well past both federal lines, often without anyone mentioning it at renewal.

Wage-and-hour is the line to read

Overtime, tip pooling, off-the-clock work and how employees are classified are wage-and-hour claims. Wage-and-hour class and collective settlements reached $323.9 million in the first half of 2026 alone, across all industries. Most EPLI policies exclude these claims or offer only a small amount toward the defense, so the policy's wage-and-hour section is the first thing to check, not the last.

Guests and vendors

A claim can also come from outside the payroll: a guest who says a server harassed them, or a vendor who says the business discriminated. That is third-party coverage, and on many EPLI policies it is an option added to the policy rather than included by default.

What to ask

Does the group have EPLI, and does it name every company that has employees? What does it do for wage-and-hour claims? Is third-party coverage on it? EPLI is one of the lines in The coverages restaurants forget, and the workers' comp side of the payroll has its own question: Are tips included in workers' comp payroll?