Is Employment Practices Liability insurance required or recommended for a Gold Star restaurant, and if recommended, what is the coverage amount?
Gold_Star Franchise · 2025 FDDAnswer from 2025 FDD Document
er insurance coverage that may be required by your lease.
- Recommended: Employment Practices Liabil
Source: Item 8 — Restrictions on Sources of Products and Services (FDD pages 21–25)
What This Means (2025 FDD)
According to Gold Star's 2025 Franchise Disclosure Document, Employment Practices Liability insurance is not required but is recommended. The FDD specifies that Gold Star franchisees should carry Employment Practices Liability insurance with a minimum coverage of $1,000,000 per claim.
Employment Practices Liability insurance (EPLI) protects businesses from claims made by employees alleging discrimination, wrongful termination, harassment, and other employment-related issues. While not mandatory, Gold Star recommends this coverage to help franchisees mitigate potential financial losses from employee lawsuits, which can be costly and time-consuming to defend, even if the franchisee is not at fault.
Franchisees should carefully consider the recommendation for EPLI, as the cost of defending against employment-related claims can be significant. Obtaining this insurance can provide a financial safety net and protect the franchisee's business assets. Cyber Liability insurance is also recommended with a $250,000 minimum.