Cracker Barrel, the national restaurant chain, has sued two of its insurance carriers for failing to pay its defense costs against an EEOC complaint, reports nashvillecitypaper.com. The EEOC alleged that Cracker Barrel employees engaged in repeated sexual harassment of female workers. There were also allegations of racial discrimination.
The case was settled when Cracker Barrel agreed to pay a collective $2 million to 51 employees.
Its insurance carriers allegedly refused repeated requests that they defend and indemnify Cracker Barrel.
In the face of that refusal, Cracker Barrel has sued the carriers in federal court in Nashville. The case has just been started and the carriers' defenses have not been formally stated. Since businesses need to know if the employment-related insurance that they have purchased will actually be available when it is needed, we will follow this issue for you.