We are always more vulnerable to the unexpected than we think. Not so long ago Croydon businesses (and others in the UK) were struggling with the after effects of riot and fire. Since then flood and landslide have upset a lot of UK businesses as we lurched from hosepipe ban and drought, to floods.
Many businesses had real trouble getting paid by their insurers after disaster struck – some of which was because they kept all their receipts and books in the premises that suffered the disaster! (Note to self — off site backups and storage are not optional.) Others simply didn’t have the kind of insurance cover they thought they had.
Hurricanes are not common in the UK, though we had the rare experience of trading through the 1987 hurricane which was centred at the top of the hill we lived on. Two weeks of power outages and phone outages taught us a lot about contingency planning, and we managed to muddle through somehow. Statistically it ought to be 100 years till the UK gets another hurricane that strong, but there is always something unexpected round the corner for business owners.
What are you staff plans for when disaster strikes? If we get snowed in, or floods take over the area, or transport strikes hit? What would happen if neither you nor your staff could reach your premises (or open them) for a fortnight? It’s a chilling thought for most of us, isn’t it?
The planning for the 2012 Olympics taught many companies that they could have people work from home, or change core hours, and still provide a service. It won’t carry you through if the whole country is off line (like the Eastern seaboard of the USA) but having a plan for what you are going to do about/with/for staff is a good place to begin.
1) Who could work from home? What equipment and arrangements would they need? Do we have them in place, or how quickly could we get them in place? Have we done a trial run?
2) What are we going to do if we can’t open our main place of business? Will staff still need to be paid if we don’t open? Do we have a plan to open somewhere else? Do our contracts allow us to designate holiday, lay offs? What are we entitled to do?
3) What if all or some of the staff can’t turn up? What if some do turn up, but very late after long and difficult journeys. Who gets paid? Who doesn’t? Can we set expectations?
4) What about parents whose children cannot go to school? Are they clear about dependants’ leave? Are you?
5) What if your business premises are not fit for use for an extended period of time? Do you have a plan to trade from somewhere else? Do you have insurance that covers you just for the cost of repairing your premises? Or do you have insurance that covers you for loss of revenue too? Check your policy — you may not have what you hope for.
6) If you have legal expenses insurers, do you have to check with them first before you can lay off staff or send them home? You may find you are not insured if you don’t get their sign-off. What happens if your insurers are not available? It’s time to check out the small print.
7) What are you going to do about health and safety? There comes a point when it is not safe to encourage people to travel to work/stay at work, etc. How are you going to judge when it is time to say enough is enough?
Many small businesses never recover from the financial losses of a disaster. Many big businesses only cope by calling on the resources of other divisions or companies within the group. Whilst disasters can be times of great camaraderie and heroism, they can also be times when businesses and jobs are swept away, never to return.
Our hearts go out to the people affected by the hurricane on the East coast of the USA. But it’s also a warning to us to be ready for the unexpected.
If you want more information on who is entitled to be paid when disaster strikes, click here
Annabel Kaye is Managing Director of Irenicon Ltd a specialist employment law consultancy