The Challenge of the New Age
Edited by David H. McIntyre and William I. Hancock
Chapter 5: Legal Liability when Businesses are Unprepared for Disasters
5 Legal liability when businesses are unprepared for disasters*1 Kevin Lindsey It is easy to dodge our responsibilities, but we cannot dodge the consequences of dodging our responsibilities. (Sir Josiah Stamp, British Businessman, 1880–1914) INTRODUCTION Organizations that still think an emergency management plan is a ‘nice-to-have’ rather than a ‘must-have’ could be in for a rude awakening if victims of workplace crises haul them into court for negligence. Catastrophic terrorist attacks. Violent crime. Ravaging hurricanes and floods. A global influenza pandemic. Remember the good old days, when business-continuation planning focused primarily on figuring out what to do if key executives were incapacitated? Today, companies need to broaden their emergency planning to encompass a wide range of potential catastrophes, first and foremost to protect their people but also to preserve their property and profits. Moreover, failure to plan may expose organizations to legal liability. Unfortunately, many organizations are not prepared. In August 2005, AT&T reported in its fourth annual survey – ‘Disaster planning in the private sector: a look at the state of business continuity in the US’ – that on average a third of companies in the country do not have a disaster recovery plan. Among the companies surveyed that do have plans, approximately 25 percent of them had neither updated their plans nor tested them within the previous year, while 17 percent said they had never tested their plans. Only 11 percent said they change their operational methods when the federal government raises its terrorist alert level. Companies...
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