What does Front Pay mean? Read on to discover the definition & meaning of the term Front Pay - to help you better understand the language used in insurance policies.
Damages claimed by a former employee representing future wages and benefits that would have been paid had the former employee not been terminated or had the employee not been forced to resign. Given the frequency with which jury awards include monies for "front pay," coupled with the potential magnitude of such awards (a wrongfully terminated 40-year-old former employee could conceivably receive 25 years of front pay), coverage for this element of damages under employment practices liability insurance (EPLI) policies is desirable. Although most of these forms do not include "front pay" within their definitions of "covered damages," neither do they exclude the exposure, and therefore cover it.
We hope the you have a better understanding of the meaning of Front Pay.