Planning for Disaster

First Considerations

An effective emergency management plan will, in order of priority:

• locate the company's employees and determine whether they are safe;
• immediately implement planned measures to protect the company's products, assets or property; and
• issue instructions to employees as to how the business will continue to run, either in its customary way, or through some other venue or mode.

The starting point for the development of an emergency management plan should be a consideration of the type of disruption an employer may face and how the disruption will impact the company's business, employees, and assets. The type of business disruption an employer may be likely to face often depends on the location of the business: certain geographical areas may be prone to earthquake, blizzards, major storms, floods, and so on.

The next consideration is the type of asset that may be damaged by a business disruption. A company whose principal product is information should ensure that the information is protected and backed up in multiple ways to avoid its irretrievable loss. Professional services firms, whose products are delivered by employees working together in a single office, should develop a means of electronically uniting employees who may be unable to come to the office following a disaster such that they can eventually continue to work together, even when a central hub is shut down or is otherwise inaccessible. In short, an emergency preparedness plan must be tailored to the type of business it covers and the employees who will be responsible for implementing the plan.

Note that some insurance polices cover business interruptions. Con-sider obtaining such insurance if the company does not have it now, and if it does, make sure to be familiar with the scope of coverage. Some insurance policies provide for payroll continuation for some period of time, often 90 to 120 days. Such continuation can be crucial to maintaining employee morale until employees can return to work. Also keep in mind that how an employer treats its employees following a disaster can be media-worthy and thus operate to the benefit or the detriment of the employer in the public eye.

Gathering and Distributing Vital Information

After the assets, products or services to be protected are identified, lists should be developed for dealing with the priorities outlined above immediately following a business disruption. Lists of employees names and contact information, as well as contact information for their next of kin, should be maintained with current information at all times. Lists of the companies customers and suppliers should also be maintained. It is important for many reasons to preserve the confidentiality of employee and customer lists, but the lists should be accessible to enough key players to allow necessary contacts to be made in the event that some key players cannot help implement the plan. Such information should be available both on- and off-site in the event that the company's main office is closed or inaccessible.

Consider establishing a toll-free call-in number for employees to receive instructions on whether, how and when to report to work, to access an emergency information system or electronic network, and to receive updates on how the business will continue to operate. Also consider a way of getting word to clients and customers as to how to be in touch with the company and how business will continue to operate. Once business continuity plans, asset protection plans, and employee and customer information systems are developed, distribute a company policy to all employees so that all employees are aware of the steps to take in the event of a business disruption. Employees should also be provided with a quick-access source of information (for example, a small laminated card) consolidating emergency numbers and procedures for employees' reference; in many cases, employees will not be at work when disaster strikes, and it is important for vital emergency-procedure information to be portable.

Responsibility for Development of An Emergency Plan

Some firms provide business interruption planning services to employers. While the advantage of utilizing such companies is their expertise in the field, one disadvantage of using them is that the employer may inadvertently telegraph to employees that the plan is not worth the employer's full attention. A better approach is to assign ultimate responsibility for the development of an emergency plan to someone sufficiently high up in the organization to give plan development and implementation credibility and prominence. The employer should also publicize the planner's involvement in development of the program.

Human Resources Considerations

Many companies will have already considered business continuity issues such as the ones outlined above. More frequently overlooked, however, are HR issues. Employers should consider how to preserve and back up important employee records that will allow vital HR functions to continue in the event of a disruption. Such information includes payroll records and personnel files. Ensure that the company has the information it needs to continue to pay employees and to administer routine HR functions. Although cost may be an issue, it may be worthwhile to scan important HR and payroll information into an electronic database in order to allow access via an off-site server.

Role of an Employee Assistance Program (EAP)

A good resource in the event of a business disruption may already exist in the form of a company's EAP. An EAP can be instrumental in providing counseling to employees affected by a disaster and in assisting them in obtaining housing and social services.

Legal and Compliance Issues Following a Disaster

In this Special Issue of Employment Law Strategist, contributors Ren' E. Thorne and Sheila Frederick discuss in this issue various sources of information as to disaster preparedness and compliance issues following a catastrophe resulting in business disruption. Additional legal and compliance issues to consider include:

Bioterrorism Preparedness and Response Act (BPRA)

Following the attacks on 9/11, President Bush urged Congress to respond to the country's need to enhance U.S. security. Congress thereafter passed the Public Health Security and Bioterrorism Preparedness and Response Act of 2002, which was signed into law in June 2002. The law states that its principal purpose is to developed a nationally “coordinated strategy, building upon the core public health” for “carrying out health-related activities to prepare for and respond effectively to bioterrorism and other public health emergencies[.]

The BPRA amended the Uniformed Services Employment and Reemploy-ment Rights Act (USERRA), which extends various job-related protections, including reinstatement rights, to employees who are called to military service. Under the amendments, USERRA's protections now also extend to “first responders,” such as individuals who are deployed to provide medical or veterinary assistance, fight fires, and provide mortuary services. Employers should be aware of USERRA's requirements in this regard, and check applicable state laws covering the same issues.

WARN Act

The federal Worker Adjustment and Retraining Notification (WARN) Act requires that employers provide 60 days' notice, or pay in lieu of notice, in advance of a plant closing or mass layoff. WARN's notice requirements are not triggered, however, when a closing or layoff occurs as the result of a natural disaster. However, it is important to be sensitive to some of the more complicated issues that may arise under WARN. For example, an employer may have to lay off employees or even shut down operations during a business interruption, not because of the direct impact of a natural disaster, but because key suppliers or customers are directly affected.

The U.S. Occupational Heath and Safety Administration, the Center for Disease Control, and the U.S. Department of labor provide much information that can assist in both planning for and responding to a business interruption caused by a disaster. Their websites should be checked frequently for information on disaster-related employment issues and emergency preparedness.

Conclusion

It goes without saying that no employer is ever fully prepared for every contingency that can arise in the course of operating a business. That said, the employer that devotes time and resources to the development of a sound, workable emergency management plan greatly enhances its chance of survival in the event of a business interruption and can minimize losses stemming from events that, however unexpected, may be inevitable.

The events of September 11, 2001 in New York and Washington, DC, caught many unprepared for the psychological effects of a terrorist attack carried out on a previously unimagined scale. The attacks also caused many businesses to consider or reconsider their own preparedness in the event of a major catastrophe: how could a business ensure continuity in the event of a significant business disruption? How would it locate its employees? How could an employer and employees communicate?

Natural Disasters

Devastating meteorological events such as Hurricane Katrina, or the major earthquake long prophesied for the West Coast — only reinforce that every employer should develop and be prepared to implement a disaster plan. The specifics of plans will be as varied as employers' businesses, as they should be tailored to the products or services the company provides, its location, the number of employees it has, and the type of business disruption the company may be likely to face. Whatever its specific contours, however, the cornerstone of any emergency management plan is ensuring that a business can continue to run, even when its usual mode of doing business is effectively shut down. Far from being a knee-jerk responses to sensational events, such preparations should be considered just another form of business contingency planning.

First Considerations

An effective emergency management plan will, in order of priority:

• locate the company's employees and determine whether they are safe;
• immediately implement planned measures to protect the company's products, assets or property; and
• issue instructions to employees as to how the business will continue to run, either in its customary way, or through some other venue or mode.

The starting point for the development of an emergency management plan should be a consideration of the type of disruption an employer may face and how the disruption will impact the company's business, employees, and assets. The type of business disruption an employer may be likely to face often depends on the location of the business: certain geographical areas may be prone to earthquake, blizzards, major storms, floods, and so on.

The next consideration is the type of asset that may be damaged by a business disruption. A company whose principal product is information should ensure that the information is protected and backed up in multiple ways to avoid its irretrievable loss. Professional services firms, whose products are delivered by employees working together in a single office, should develop a means of electronically uniting employees who may be unable to come to the office following a disaster such that they can eventually continue to work together, even when a central hub is shut down or is otherwise inaccessible. In short, an emergency preparedness plan must be tailored to the type of business it covers and the employees who will be responsible for implementing the plan.

Note that some insurance polices cover business interruptions. Con-sider obtaining such insurance if the company does not have it now, and if it does, make sure to be familiar with the scope of coverage. Some insurance policies provide for payroll continuation for some period of time, often 90 to 120 days. Such continuation can be crucial to maintaining employee morale until employees can return to work. Also keep in mind that how an employer treats its employees following a disaster can be media-worthy and thus operate to the benefit or the detriment of the employer in the public eye.

Gathering and Distributing Vital Information

After the assets, products or services to be protected are identified, lists should be developed for dealing with the priorities outlined above immediately following a business disruption. Lists of employees names and contact information, as well as contact information for their next of kin, should be maintained with current information at all times. Lists of the companies customers and suppliers should also be maintained. It is important for many reasons to preserve the confidentiality of employee and customer lists, but the lists should be accessible to enough key players to allow necessary contacts to be made in the event that some key players cannot help implement the plan. Such information should be available both on- and off-site in the event that the company's main office is closed or inaccessible.

Consider establishing a toll-free call-in number for employees to receive instructions on whether, how and when to report to work, to access an emergency information system or electronic network, and to receive updates on how the business will continue to operate. Also consider a way of getting word to clients and customers as to how to be in touch with the company and how business will continue to operate. Once business continuity plans, asset protection plans, and employee and customer information systems are developed, distribute a company policy to all employees so that all employees are aware of the steps to take in the event of a business disruption. Employees should also be provided with a quick-access source of information (for example, a small laminated card) consolidating emergency numbers and procedures for employees' reference; in many cases, employees will not be at work when disaster strikes, and it is important for vital emergency-procedure information to be portable.

Responsibility for Development of An Emergency Plan

Some firms provide business interruption planning services to employers. While the advantage of utilizing such companies is their expertise in the field, one disadvantage of using them is that the employer may inadvertently telegraph to employees that the plan is not worth the employer's full attention. A better approach is to assign ultimate responsibility for the development of an emergency plan to someone sufficiently high up in the organization to give plan development and implementation credibility and prominence. The employer should also publicize the planner's involvement in development of the program.

Human Resources Considerations

Many companies will have already considered business continuity issues such as the ones outlined above. More frequently overlooked, however, are HR issues. Employers should consider how to preserve and back up important employee records that will allow vital HR functions to continue in the event of a disruption. Such information includes payroll records and personnel files. Ensure that the company has the information it needs to continue to pay employees and to administer routine HR functions. Although cost may be an issue, it may be worthwhile to scan important HR and payroll information into an electronic database in order to allow access via an off-site server.

Role of an Employee Assistance Program (EAP)

A good resource in the event of a business disruption may already exist in the form of a company's EAP. An EAP can be instrumental in providing counseling to employees affected by a disaster and in assisting them in obtaining housing and social services.

Legal and Compliance Issues Following a Disaster

In this Special Issue of Employment Law Strategist, contributors Ren' E. Thorne and Sheila Frederick discuss in this issue various sources of information as to disaster preparedness and compliance issues following a catastrophe resulting in business disruption. Additional legal and compliance issues to consider include:

Bioterrorism Preparedness and Response Act (BPRA)

Following the attacks on 9/11, President Bush urged Congress to respond to the country's need to enhance U.S. security. Congress thereafter passed the Public Health Security and Bioterrorism Preparedness and Response Act of 2002, which was signed into law in June 2002. The law states that its principal purpose is to developed a nationally “coordinated strategy, building upon the core public health” for “carrying out health-related activities to prepare for and respond effectively to bioterrorism and other public health emergencies[.]

The BPRA amended the Uniformed Services Employment and Reemploy-ment Rights Act (USERRA), which extends various job-related protections, including reinstatement rights, to employees who are called to military service. Under the amendments, USERRA's protections now also extend to “first responders,” such as individuals who are deployed to provide medical or veterinary assistance, fight fires, and provide mortuary services. Employers should be aware of USERRA's requirements in this regard, and check applicable state laws covering the same issues.

WARN Act

The federal Worker Adjustment and Retraining Notification (WARN) Act requires that employers provide 60 days' notice, or pay in lieu of notice, in advance of a plant closing or mass layoff. WARN's notice requirements are not triggered, however, when a closing or layoff occurs as the result of a natural disaster. However, it is important to be sensitive to some of the more complicated issues that may arise under WARN. For example, an employer may have to lay off employees or even shut down operations during a business interruption, not because of the direct impact of a natural disaster, but because key suppliers or customers are directly affected.

The U.S. Occupational Heath and Safety Administration, the Center for Disease Control, and the U.S. Department of labor provide much information that can assist in both planning for and responding to a business interruption caused by a disaster. Their websites should be checked frequently for information on disaster-related employment issues and emergency preparedness.

Conclusion

It goes without saying that no employer is ever fully prepared for every contingency that can arise in the course of operating a business. That said, the employer that devotes time and resources to the development of a sound, workable emergency management plan greatly enhances its chance of survival in the event of a business interruption and can minimize losses stemming from events that, however unexpected, may be inevitable.