Before the Emergency: Preparing Your Business for Disruptions

Coastal businesses are no strangers to disruptions caused by emergencies. With experts predicting an extraordinarily active hurricane season, it’s important to make time to update your company’s preparedness plan. Working with your team to develop clear and specific answers to the questions in this article can help minimize loss and disruption in the event of an emergency. For each question, we’ve provided a list of recommended action items.

1) How will your team track the emergency?

• Designate an individual or team to monitor forecasts and updates from relevant authorities (e.g., National Weather Service or local emergency management every six hours).
• Create an “Emergency Priority List” of the most important tasks at each stage of the emergency (Watch, Warning, Alert, Evacuation Order).
• Develop a “Team Alert” threshold for when the company will begin communicating with employees about a potential shutdown or suspension of operations (g., within a specific time frame before the event or upon issuance of a warning).
• Communicate calmly and consistently with employees to minimize uncertainty once the “Team Alert” threshold has been crossed.
• Revise your Emergency Priority List and Team Alert procedures after each emergency event.

2) How will you decide to suspend operations or evacuate?

• Develop decision-making protocols in advance to ensure steady decisions in hectic circumstances.
• Identify the individual or team responsible for making the final decision to suspend operations and/or evacuate.
• Create a list of who on your team needs to know what and when.
• Outline and practice company-wide shutdown procedures.
• Conduct drills and debriefs to clarify how much time employees need to complete shutdown tasks.
• Understand payroll obligations and compliance with the FLSA for full or partial days that your business is closed due to a natural disaster (e.g., which employees need to be paid during “hurricane days” when the business is closed and how much they are paid during that time).

3) How will you connect with your team after an evacuation?

• Collect evacuation plans and contact information from your employees.
• Encourage employees to discuss evacuation plans with colleagues.
• Set aside time for employees to prepare personal disaster kits and evacuation plans.
• Confirm with IT that the software the company uses for meetings and internal communications will be available for remote work.
• Ensure employees have the necessary hardware for remote work and arrange for emergency distribution if needed.

4) How will you access important data from another location?

• Make a comprehensive list of the company’s most important documents. The list should include trade secrets, leases, contracts, loan documents, permits and certificates, and insurance policies.
• Ensure these documents are backed up both in the cloud and off-site locations. Confirm again.
• Designate employees responsible for evacuating with documents (or physical assets) that cannot stay behind in an evacuation.
• Consult with your legal team about any data security and privacy concerns associated with accessing data from remote locations and maintain an inventory of technological assets supplied to employees (which should include the ability to remotely wipe corporate data on those assets).
• Coordinate with your IT provider to develop and implement a remote work plan and procedures in the event on-site servers are inaccessible, with an emphasis on remote access security and limitations.
• Do not assume every employee needs to access every system remotely and incorporate appropriate data segregation and permissions to protect data privacy while remote.

5) How can you minimize property damage and recovery costs?

• Take photos of your building, offices and other assets and create a digital catalog. Back up the catalog on the cloud or a portable external hard drive.
• Make sure site maps are up to date.
• Develop a clear idea of post-storm responsibilities by reviewing lease provisions related to insurance policies, the lessor’s duty to repair and termination rights.
• Gather two weeks of supplies including food and water, first-aid kits and generators for employees who remain on-site. Prepare a contingency plan in case power cannot be restored within the two-week window.
• Ask your insurer specific questions about property coverage and keep records of the communications.

6) How can you minimize business disruptions?

• Ask your insurer specific questions about business interruption coverage and keep records of the communications.
• Analyze loan documents for specifics on lender and borrower obligations in the event of a natural disaster.
• Review provisions in existing contracts, including force majeure clauses, to better understand your rights and obligations in the event of a natural disaster.
• Keep hard and soft copies of supplier and vendor lists, along with key contacts in local and state government and community groups.
• Designate a point person in the company to communicate the company’s emergency preparedness plans to suppliers and maintain communication with those suppliers during and after an evacuation.

Developing a comprehensive and specific emergency preparedness plan gives your business the best chance of maintaining operations before, during and after an emergency. Please contact Philip deV. Claverie Jr., Andrew Meaders, Jason Pill or any other member of Phelps’ Business, Cybersecurity, Data Privacy and Protection, or Labor and Employment teams if you have any questions or need advice and guidance.