Emerging Risk Insights from the PLUS EPL Think Tank: AI, DEI, and the Changing Workplace

The PLUS EPL Think Tank highlights a rapidly evolving employment liability landscape shaped by legal developments, workforce shifts, and technological disruption. Key themes include:

AI in the Workplace & Litigation

Organizations are increasingly using AI in hiring, performance management, and daily operations, raising concerns around bias, transparency, and discrimination exposure. The use of AI tools such as workplace assistants and legal “scribes” also introduces unresolved issues around confidentiality and attorney-client privilege.

At the same time, AI is reshaping litigation itself. Employers are facing AI-assisted claims, including sophisticated pro se complaints, while grappling with discovery challenges related to identifying, preserving, and producing AI-generated content. These issues are not limited to the U.S., with similar trends emerging internationally.

False Claims Act (FCA) & DEI-Related Liability

Heightened scrutiny around DEI initiatives particularly for federally funded entities creates potential whistleblower and retaliation exposure under the FCA. There is growing uncertainty whether similar theories could extend to private organizations.

Evolving Case Law: Muldrow & Reverse Discrimination Trends

Recent decisions like Muldrow and the Supreme Court’s ruling in Ames v. Ohio are reshaping discrimination standards, lowering thresholds for certain claims and contributing to increased reverse discrimination filings following DEI rollbacks.

EEOC Activity & Enforcement Outlook

With the U.S. Equal Employment Opportunity Commission regaining quorum under new leadership, employers and insurers should expect more active rulemaking, enforcement, and guidance that potentially influencing claim frequency and regulatory risk.

Rise in Disability and Mental Health Claims

There is a significant increase in disability-related claims, particularly involving mental health and “invisible” disabilities. These claims are expanding employer obligations around accommodation, documentation, and workplace flexibility.

Wage Transparency & Equal Pay Litigation

Pay transparency laws originating in states like Washington are spreading nationwide, increasing scrutiny and litigation around compensation practices and equity.

Cyber Risks Converging with EPL

Cyber incidents are increasingly triggering employment-related claims, including those tied to employee data, internal misconduct, and workplace privacy violations.

Workforce Transformation & Generational Tensions

Post-COVID workplace shifts like remote work, changing expectations, and generational differences are creating new friction points that can lead to discrimination, accommodation, and retention-related claims.

Geographic Expansion of Risk

EPL exposure is expanding beyond traditional jurisdictions like California, New York, and New Jersey, with emerging states becoming new litigation hot spots.

Nuclear Verdicts & Claims Severity

The EPL space is experiencing larger jury awards, increasing severity concerns and putting pressure on limits, pricing, and claims strategies.

Aggressive Claims Tactics (PA & NJ Trends)

Plaintiffs are increasingly demanding full policy limits early in the claims process, often with strict deadlines, complicating claims handling and settlement dynamics.

Wage & Hour Developments (Including PAGA Reform)

California’s Private Attorneys General Act (PAGA) reforms continue to evolve. Nearly two years post-reform, stakeholders are evaluating whether the changes have meaningfully reduced claim frequency or shifted exposure, particularly for class and representative actions, with implications for underwriting and sublimits.

These developments reflect a more complex, fast-moving EPL risk environment with direct implications across the professional liability insurance industry.

EPL risk is becoming more technology-driven, regulation-focused, and litigation-intensive. Staying ahead of these trends particularly the intersection of AI, workforce change, and legal evolution is critical for effectively underwriting, managing, and mitigating professional liability exposure.

Thank you to the PLUS EPL Think Tank for their continued insights that help shape the content PLUS provides throughout the year.

• Laura Corvo, White & Williams
• Rachel Freedman, Sompo
• Tom Hams, Aon
• Chris Lavelle, USLI
• Paul Pipia, SompoRe
• Erin Ringbloom, Allied World
• Rical Showers, AXA XL
• Chris Williams, Travelers
• Peter Woo, Jackson Lewis P.C.
• Melisa Zwilling, Carr Allison

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