Why you should have a business interruption policy
The emergence of COVID-19 created many unexpected questions for business owners and managers. To help you and your business understand your obligations, now and in the future we’ve recruited Gillian Bristow, Legal Practitioner Director of Bristow Legal, to provide you with useful information.
Policies, procedures and paperwork
Your inbox is probably still full of emails from customers, principal contractors and subcontractors telling you they are still open for business and that they have various strategies, action plans and emergency response plans.
Some customers are now insisting that all their suppliers have a COVID-19 policy that sets out how they are managing the risks associated with operating during the pandemic. It’s easy to understand why customers want reassurance. The customers themselves have their own WHS duties to keep their people safe and want to be sure that you are also doing everything reasonably practicable to maintain safety and comply with government guidelines.
Why should I have a business interruption policy?
While the most important part of managing a major business disruption event is doing the right thing and following government directions and guidelines, written policies and procedures are also important. Writing a policy helps you think through how you are going to manage the huge range of risks associated with being an essential supplier at a time of national or state emergency.
Workplace policies are particularly important because they clearly set out your values and how you are going to comply with your legal obligations. Having a written policy on how you will manage issues helps everyone in your business and your supply chain understand how you are operating in these novel times.
Your management and team members should be involved in the development and implementation of the policy to ensure a unified approach is taken.
Steps to writing this type of policy
Step #1 – What’s the purpose?
As with any business policy, your business interruption policy should set out a statement of purpose plus guidelines and actions that will be taken to achieve that purpose. In the case of a COVID-19 policy, your statement of purpose might be something like this:
(Name of transport business) is responsible for ensuring, so far as is reasonably practicable, the health and safety of all employees and subcontractors who carry out work on its behalf. We are committed to ensuring the safety and wellbeing of all of our customers, visitors and those we deal with in the course of our business. We are also committed to supporting all government measures to minimise COVID-19 transmission, prepare health system needs and provide information to support best practice health care in relation to the COVID-19 pandemic.
The policy could also explain what COVID-19 is, relevant symptoms and why it is important to minimise virus transmission.
Step #2 – How will your business achieve its aim/purpose?
Your policy should also set out, in broad terms, how your business is going to achieve these aims. For example, your policy might say:
(Name of transport business) is responsible for:
- a. implementing strategies that assist in minimising COVID-19 transmission including:
- (i) issuing drivers with hand sanitiser;
- (ii) minimising interaction between drivers and customers by not insisting on customers signing for deliveries;
- (iii) actioning ‘social distancing’ by conducting meetings and other business group gatherings electronically;
- (iv) ensuring that customers and those in control of sites which (name of transport business) must attend are adhering to appropriate strategies and protocols and refusing to attend sites which (name of transport business) is aware present a risk to its employees or subcontractors; and
- (v) preventing non-essential visitor/s from accessing its depot or offices.
- b. keeping up to date with the latest COVID-19 information and advice from the Australian government and state agencies to ensure that any action taken is appropriate;
- c. directing employees to work from home where practical; and
- d. carrying out cleaning in according with recommended procedures at our depot and offices.
Safe Work Australia has published two guides with recommendations as to how you can minimise risks associated with road freight and warehousing. You should read these and incorporate relevant recommendations.
Step #3 – What do you need those associated with your business to do?
Your policy can also set out what you require of others you work with, both within your own business and outside your business. For example, your policy could say:
(Name of transport company) requires all employees and subcontractors to:
- a. comply with all Federal and State law relating to the COVID-19 public health emergency;
- b. take reasonable care not to adversely affect the health and safety of others, including by:
- (i) observing recommended hygiene procedures;
- (ii) urgently seeing a health care professional if they experience symptoms of COVID-19; and
- (iii) not attending work if they have been ordered to self-isolate, are unwell (such as with a cough or low-grade fever) or have potentially been exposed to COVID-19.
Your policy may also set out the consequences if those to whom it applies do not comply with the policy.
I’ve prepared a policy – am I all done now?
Having a written policy is just the beginning. The policy is useless if you don’t distribute it, explain it and train your team in what you require of them – including as new starters come on.
A policy is also worthless if it doesn’t reflect what you are actually doing in practice. Saying drivers will be using hand sanitiser if you don’t have any, or it hasn’t been given out, is foolish and likely to get you into legal and practical hot water.
In addition, your policy should be regularly reviewed to take into account emerging risks, or other scenarios that you may not have thought of before. This also means regularly raising it with staff, to either refresh them on the policy, or update them on changes.
In this rapidly changing environment, decisions need to be made quickly. It is important that you keep up to date with any changes to the law and what you can and can’t do. It’s a good idea to adapt your policy and procedures frequently based on these changes, or changes to government health guidelines. You can track changes to your policy by creating different versions with dates. You should note these at the bottom of your official policy. Here’s an idea of how to do this:
25 March 2020
Name of reviewer
Name of managing director
31 March 2020
Amended to refer to no more signing on glass
Name of reviewer
Name of managing director
Gillian has provided advice to the road transport industry for more than 25 years. She regularly presents to industry conferences and seminars, and writes a column for the magazine ‘Power Torque’. Gillian has previously worked with NTI to provide guidance material on chain of responsibility obligations and with the Australian Trucking Association to prepare a checklist for reviewing transport contracts.
Prepared 3 April 2020. Updated 19 April 2021. Please note that this publication is for information only and is not legal advice. You should consider obtaining advice that is specific to your circumstances and should not rely upon this publication as legal advice.
- Writing a policy helps you think through how you are going to manage the huge range of risks associated with being an essential supplier
- Your business interruption policy should set out a statement of purpose plus guidelines and actions that will be taken to achieve that purpose
- Your policy should also set out, in broad terms, how your business is going to achieve these aims