Must the Dickeys Barbecue Pit EPLI policy include coverage for third-party claims?
Dickeys_Barbecue_Pit Franchise · 2024 FDDAnswer from 2024 FDD Document
insured coverage shall not be limited to Dickey's vicarious liability, and shall include coverage for liability arising out of or occurring upon or in connection with the condition, operation, use or occupancy of
the franchised business. Also, the umbrella insurance shall contain a waiver of subrogation in favor of Dickey's, its subsidiaries, affiliates, successors and assigns.
- ii. An endorsement requiring the umbrella liability insurance carrier(s) to provide at least thirty (30) days' notice of any intent to cancel the umbrella policy, regardless of the reason for cancellation.
Source: Item 22 — CONTRACTS (FDD pages 95–96)
What This Means (2024 FDD)
According to Dickeys Barbecue Pit's 2024 Franchise Disclosure Document, the Employment Practices Liability Insurance (EPLI) policy that franchisees are required to obtain must include coverage for third-party claims. Additionally, the policy must have a sublimit for defense costs related to wage and hour claims.
This requirement means that the EPLI policy must protect Dickeys Barbecue Pit franchisees from claims made by individuals who are not directly employed by the franchisee but allege discrimination, harassment, or other employment-related issues. This is in addition to covering claims made by the franchisee's own employees.
Furthermore, Dickeys Barbecue Pit requires that the EPLI policy have a sublimit for defense costs associated with wage and hour claims. This is a specific type of employment-related claim that can be costly to defend, so having a dedicated sublimit can help franchisees manage these expenses. The EPLI Policy shall also have an endorsement listing Dickey's, its subsidiaries, affiliates, successors and assigns as additional named insureds. In the event that an additional insured endorsement is not available, you shall have a vicarious liability endorsement protecting Dickey's, its subsidiaries, affiliates, successors and assigns.