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The big employment practices liability question Featured

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The big employment practices liability question

Employment Practices Liability defined:  “Employment Practices Liability (EPL) provides insurance for employers against allegations of unfair dismissal and unfair labour practices (including sexual harassment and discrimination) brought by a past, present or even future employee.”



Employment Practices Liability Insurance (EPLI) was introduced to the South African insurance landscape in 1998, just two years after the formation of the Commission for Conciliation, Mediation and Arbitration. At the time, most underwriters were reluctant to sign for the cover. This reticence was partially due to the historically poor industrial relations environment and then of course the perception that the post-apartheid closet of South Africa still contained many skeletons - even in the workplace.


But by the year 2000, underwriters became more comfortable with what really amounted to “labour dispute insurance” and over time, a few specialised markets gradually introduced the new form of cover. As the CCMA case load grew; the knock on effect was more corporate and large employers sought out this then niche insurance. These employers typically had a workforce exceeding 500 and immediately recognised the benefits of being able to transfer the risk of CCMA and Labour Court awards into the insurance market.


A proof point of this must surely be that the maximum amount that can be awarded by the Labour Court for an Automatically Unfair Dismissal is 24 months’ salary. At a middle management salary of R30 000 per month, the award could reach R720 000 – a bitter pill for even a large employer to swallow. Of course the larger employers were also faced with another problem: the frequency of losses due to labour disputes could be likened to the frequency of accidents in the motor fleet. While it may sound ridiculous, the ratio of accidents to motor vehicles on South African roads is actually far lower than the ratio of CCMA cases to employers.

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Last modified on Friday, 28 February 2014 16:10
Mitch Marescia

Mitch Marescia

In just 10 years, Camargue co-founder and CEO Mitch Marescia, has transformed a relatively small startup underwriting business into one of South Africa’s most successful niche insurance underwriting agencies. Prior to starting Camargue, he enjoyed first-hand the challenges of managing his own business, MGM Corporate Solutions. His experience preceding MGM’s launch was grounded at AIG where his initial position was that of Financial Controller and Company Secretary. With a growing list responsibilities Mitch was soon promoted to Vice President of Operations and Company Secretary. The knowledge he has gleaned during his extended exposure to the intricacies of the industry have well positioned him for his leadership role of the greater Camargue Group. Focused on growing the business, Mitch is steering the strategic and sustainable direction of Camargue. He is heavily involved in exploring opportunities in Africa, while also securing new local and international partners. A man with great vision, Mitch is passionate about the industry, empowering people and starting new businesses. His love of this country and its people, and his constant striving to uplift South African society, is engrained in the culture he has determinedly fostered within Camargue. A non-conformist, his energy, razor sharp focus and invested leadership style, will undoubtedly carry the business forward for another excitingly successful decade in the insurance industry.

Website: www.camargueum.co.za

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