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Texas · Chapter 21 + SB 45

Texas EPLI insurance, built for Chapter 21 & the SB 45 era.

EPLI built for the state that files more EEOC charges than any other — Texas Labor Code Chapter 21 discrimination exposure, and the 2021 sexual-harassment amendments that pulled every employer in the state, down to a single employee, under the law and put supervisors personally on the hook.

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Structured for Texas Labor Code Chapter 21 discrimination claims
Built for SB 45 all-employer sexual-harassment & individual liability
Markets that write Texas employment risk at every headcount

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Home›Texas EPLI Insurance
Texas EPLI, in plain terms

Texas markets itself as a light-regulation state, and for most employment claims its law does track the federal baseline. But since September 1, 2021, Texas has had one of the toughest sexual-harassment statutes in the country: it applies to every employer with even one employee, allows claims against individuals who act for the employer, and holds companies to an “immediate and appropriate corrective action” standard. Add the nation’s highest EEOC charge volume, and here is what it means for your EPLI.

Chapter 21 and the TWC Civil Rights Division

Texas’s core employment statute is Texas Labor Code Chapter 21 — the successor to the Texas Commission on Human Rights Act (TCHRA) — enforced by the Civil Rights Division of the Texas Workforce Commission (TWC), which operates under a workshare agreement with the EEOC. Chapter 21 prohibits discrimination based on race, color, disability, religion, sex, national origin, and age, and for most claims it applies to employers with 15 or more employees, mirroring Title VII.

The deadlines are tighter than in most large states: a discrimination complaint generally must be filed with the TWC Civil Rights Division within 180 days of the alleged violation — sexual-harassment complaints get 300 days under a 2021 amendment. That short fuse cuts both ways for employers: stale claims die quickly, but charges arrive fast and in volume. Texas produces more EEOC charges than any other state, and the EEOC logged 88,531 new charges nationally in FY 2024, up more than 9% year over year — with Texas the single largest contributor.

The 2021 sexual-harassment amendments changed the map

Effective September 1, 2021, Senate Bill 45 added a sexual-harassment subchapter to Chapter 21 that departs sharply from the rest of Texas law:

  • Every employer is covered: for sexual-harassment claims, “employer” means anyone who employs one or more employees — the 15-employee floor is gone. A two-person shop in Texas carries the same statutory harassment exposure as a corporation.
  • Individuals can be sued: the definition also reaches any person who “acts directly in the interests of an employer in relation to an employee” — language courts and commentators read to expose supervisors, managers, and owners to personal liability on sexual-harassment claims, something federal Title VII does not do.
  • A tougher conduct standard: an employer is liable if it or its agents or supervisors knew or should have known of the harassment and failed to take “immediate and appropriate corrective action” — a heightened, still-being-litigated standard — and the filing window for these claims runs 300 days instead of the usual 180.

How your EPLI should be structured in Texas

The SB 45 era makes two policy features non-negotiable in Texas. First, the definition of insured persons: because supervisors and managers can be named personally on sexual-harassment claims, the policy must clearly cover individual directors, officers, and employees acting in their capacity for the company — and you should know whether defense for those individuals shares the same limit. Second, small-employer coverage: Texas businesses under 15 employees often assume they are below every threshold, but for sexual harassment they are not, and a first-dollar-defense-oriented EPLI with a modest retention fits that exposure. For larger Texas employers, the state’s nation-leading charge volume argues for a program sized to absorb frequency — and Texas juries are capable of substantial verdicts when a case gets through. We structure Texas EPLI around all of it.

Texas EPLI — Frequently Asked

Questions Texas operators ask.

I have fewer than 15 employees in Texas — can I really be sued for harassment?
Yes. Since September 1, 2021, Texas Labor Code Chapter 21 defines “employer” for sexual-harassment purposes as anyone who employs one or more employees, so the 15-employee floor that shields small businesses from most discrimination claims does not apply to sexual harassment. The 2021 amendments also give claimants 300 days to file with the TWC Civil Rights Division — longer than the 180 days allowed for other claims — and hold employers to an “immediate and appropriate corrective action” standard once they know or should have known of the conduct. That combination means the smallest Texas employers now carry genuine statutory harassment exposure with no HR department to manage it. An EPLI policy with a workable retention is what stands between a harassment charge and a five- or six-figure defense-and-settlement bill.
Can my managers be sued personally in Texas — and will EPLI defend them?
On sexual-harassment claims, quite possibly. The 2021 amendments define “employer” to include any person who acts directly in the interests of an employer in relation to an employee — language widely read to expose supervisors, managers, and owners to personal liability, which federal Title VII does not impose. Whether your EPLI defends them turns on the policy’s definition of insured persons: most well-built forms cover directors, officers, and employees for acts in their insured capacity, but the breadth of that definition, and whether individual defense costs erode the shared limit, varies meaningfully by carrier. When we place Texas EPLI we confirm the individual-insured wording matches this exposure, so a claim naming both the company and the manager who allegedly failed to act is defended under one coordinated policy rather than leaving the individual to fund their own lawyer.
What does EPLI (employment practices liability insurance) actually cover?
EPLI covers claims that employees, former employees, and job applicants bring over how they were treated at work. The core perils are wrongful termination, discrimination, harassment (including sexual harassment), retaliation, and failure to promote or hire. Most policies also respond to related allegations such as wrongful discipline, negligent evaluation, and defamation tied to employment. Crucially, EPLI pays both the cost to defend the claim and any settlement or judgment. These exposures are specifically excluded by general liability and are not covered by workers’ compensation, which is why employers carry EPLI as a separate line. Federal claims are enforced through the U.S. Equal Employment Opportunity Commission (EEOC), and most states add their own, often broader, employment laws on top.
Why does every employer need EPLI, even a small one with good practices?
Because employment claims are filed by people, not by your record. A termination handled correctly, a promotion that went to one candidate over another, or a single comment can still produce an EEOC charge or a single-plaintiff lawsuit — and you pay to defend it whether or not you did anything wrong. Many anti-discrimination laws apply to very small employers: federal harassment protections under Title VII reach employers with 15 or more employees, but state laws often go lower, and some apply to employers with only a single employee for certain claims. Defense costs alone for an employment suit routinely reach five and six figures. EPLI exists so that one disgruntled employee does not become a balance-sheet event.
Other States

EPLI insurance in other states.

California · FEHA & PAGA exposureNew York · All employers, two lawsFlorida · FCRA & whistleblower exposureIllinois · IHRA + BIPA biometric exposureNew Jersey · LAD breadth + CEPAPennsylvania · PHRA + Philadelphia overlayOhio · Reformed Chapter 4112 rulesGeorgia · Federal Title VII forumWashington · WLAD + pay-transparency suitsArizona · ACRA + 1-employee harassment ruleNevada · NRS 613 + cannabis hiring rulesColorado · CADA + POWR Act standard

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