Keep human resource issues up front when business disrupted Disaster assistance

Many of us have spent the traditional Christmas and New Year holiday season celebrating the accomplishments of our 2011 goals and looking forward to the many successes anticipated for 2012.

At the same time, being realistic, we also know that challenge will also undoubtedly be part of our lives in the days ahead. However, the problem is that we often can't anticipate exactly what the challenges might be and therefore it is difficult to plan for such events.

One of the more difficult challenges for any business is a disastrous fire, which is exactly what happened on Jan. 2 to a thriving Winnipeg business that produced fibreglass components for windows and doors. Not only was the manufacturing plant destroyed, but four firefighters suffered minor injuries when an explosion occurred inside the burning building.

While many people might wipe their brow and say thank goodness no one was seriously hurt physically, they often don't think about all of the other elements of the word hurt that will be experienced going forward. Guaranteed, there will definitely be a good deal of "hurt' going around for both employers and employees. In the face of a disaster such as the recent fire, it is natural for a business owner to call their insurance broker as the first step in dealing with it. However, according to Tracey Epp, a well-known labour lawyer with Pitblado, LLP, the need to deal with the resulting human resource issues is equally as urgent.

This is particularly true because no matter what business circumstances cause an employee layoff or termination, the rules of the Manitoba Employment Standards code still apply and can result in significant financial costs for the employer.

Ordinarily, if a decision results in 50 to 100 employees being forced out of work for a significant period of time, the group termination rules could apply. This means notification must be given to the minister of labour and Immigration and at least 10 weeks notice to employees or payment in lieu. For a group of employees ranging from 101 to 299, 14 weeks notice is required. And for a business with over 300 employees, 18 weeks notice is required.

If there are less than 50 employees and these individuals will be out of work for more than eight weeks in a 16-week period, the Employment Standards Code also deems this to be termination. That, in turn, triggers its severance provisions.

However, there is an exception relating to situations where the contract of employment cannot be fulfilled due to fortuitous or unforeseen circumstances.

Surely, a fire would qualify, would it not? Epp says it remains up to the employer to seek legal advice to ensure the code's provisions are adhered to and to deal with the critical issue of what to do with employees following a disaster in order to avoid additional unexpected yet significant costs to the employer.

Epp also suggests one of the first priorities for a business leader is to assess the business damage and determine the impact on employees. In particular, get a grip on the questions that employees will need to have addressed. For instance, can key employees work from home and/or another offsite location in order to provide business continuity? Will some departments be able to return to work immediately? Will layoffs be temporary and if so, for how long? Or, will the business be able to recover at all? Dealing with these critical human resources issues could protect financial resources as well as preserve the loyalty and security of your staff.

Meeting with employees as soon as possible after the event is critical. This is especially so because employees scheduled for work the day after the disastrous event still expect to be paid. And of course, all the other employees are anxious to learn "what's what" with respect to their job security. As well, if the business is unionized, it is important to involve union leaders as quickly as possible.

The next challenge however, is to quickly access a list of employee names, addresses, phone numbers and other contact information. Many small businesses in particular don't do a good job of maintaining their personnel files in the first place and often staying current with employee contact information is one of the biggest downfalls. Where is the list when you need it? Hopefully, over time, IT advisers have convinced employers of the importance of keeping offsite backup.

Contact your employees using every method you can, be it telephone, email, text or registered mail. Prepare to hold an initial meeting at the earliest possible date. Gather your advisers around you and prepare an agenda that will outline for employees all of the issues you are facing.

In my view, it is meetings such as this where honesty and integrity plays a key role. When disaster strikes, employees go into what is known as career overdrive because, let's be honest, their personal and financial security is perceived to be at stake equally as much as that of the business owner. As a result, employees need to hear the truth without any sugar-coated platitudes.

While you may not have all the answers at your initial employee meeting, at least deal with the most critical employment questions and ensure individuals they will receive continuing information as it is available. Prepare written questions and answers for the employees to take home along with the name and number of a key contact person who can accept questions as they arise.

On the other hand, it seems that a person is never able to identify enough questions and so as additional thoughts come forward, be prepared to send out a weekly communiqué of some kind to keep employees informed. Then, hold a second employee meeting as soon as you have additional concrete information to share.

If it is quickly evident that employees will be out of work for a significant period and/or if it is determined at this early stage the business will not continue, then take an additional step to assist your employees with their future. Professionals from various government support departments, such as Employment Insurance, are more than willing to attend your meetings to explain the rules and processes for accessing their services.

If possible, arrange for career transition services to help employees write resumés and get back into the job market as soon as possible. While a business leader may feel this is contrary to common sense, I guarantee that if your human resource and career management issues are seen as humane and with consideration for employee interests, they will return to work for you once your business is operating again.

You may also consider continuation of group benefits while determining whether or not to resume business. For a fire which occurred on Jan. 2, the premiums for that month have likely been paid. Consider another few months as again this may be the move that prompts employees to return to work again.

Having to confront a catastrophic business emergency is extremely challenging at the best of times and not something anyone wants to address. However, if the resulting human resource issues are not given urgent attention, financial liabilities will soar and talented staff will move on to other opportunities.

Barbara J. Bowes is president of Legacy Bowes Group and vice-president of Waterhouse Executive Search Group. She can be reached at barb@legacybowes.com

Republished from the Winnipeg Free Press print edition January 7, 2012 H1