October 8, 2007

Disaster Planning for Employers

Holland & Knight Newsletter
William B. deMeza Jr.

Recent natural catastrophes have focused employers’ attention on disaster preparation and response in compliance with employment laws. Hurricanes, floods, forest fires, tornadoes and blizzards have required employers to address staffing, personnel and business-continuation issues arising from destruction or closure of the workplace, or employees’ refusals or inabilities to report to work during the disaster or in the recovery period. This two-part article will address the common employment law issues faced by employers in such circumstances.

Staffing, Discharge and Leave Issues

Employers’ most difficult disaster-related decisions often involve employees who refuse to work during the event or in the cleanup/recovery period. “Difficult” not only in the legal sense (is the employee legally protected from discharge?) but also in the moral sense (is it fair to terminate him/her?). It obviously is important to comply with the law and be consistent in your decisions.

Many states’ Governors have the authority to issue mandatory evacuation orders in conjunction with natural disasters, prompting the question, “Do such orders provide job protection for ‘at will’ employees?” Although the answer varies somewhat by state, it generally appears that such orders do not supersede the employment laws, there are few mechanisms to enforce the orders and there are limited consequences for disobeying them. In Florida, for example, such orders seem to be advisory in nature, that is, to warn residents that if they remain in the evacuation area, they may not receive police, fire and ambulance assistance. Thus, a court has rejected wrongful discharge claims by nursing home employees fired for failing to report to work after a Florida mandatory evacuation order. More generally, it appears likely that, in any such dispute, a court would balance the employer’s and employees’ interests in light of the public interest and welfare; thus, a hospital’s discharge of an ER nurse who refuses to work during a hurricane is more likely to be upheld than a car dealer’s termination of a janitor for refusing to work during cleanup.

Federal and state leave laws, and existing employer leave policies, also may affect discharge decisions. The federal Family and Medical Leave Act (FMLA) may require leaves for employees (or their family members) injured in the disaster (though employees on FMLA leave at the time of the event have no greater rights or protections than other employees if the plant closes or the employer goes out of business). Since employees may have difficulty accessing health care providers after a disaster, employers should be cautious about too-quickly denying FMLA leaves because the employee cannot produce a medical certification, because the law often excuses untimely submissions if the employee has difficulty accessing medical professionals. The Americans with Disabilities Act (ADA) may require additional reasonable accommodations for disabled employees unable to access the workplace because of a disaster; accommodations might include unpaid leave and telecommuting if communications systems are working. (It may be helpful for employers to have, at some disaster-proof and accessible off-site location, a list of personnel and their contact information, including information identifying ADA/FMLA eligible employees.) Finally, non-medical leaves may be required by individual employment contracts, a collective bargaining agreement or company policy. It is important to think about discretionary leave policies before a disaster, considering such questions as: What personnel and operational units will be allowed to take leave, and for what periods? Will leaves be paid? Will employees be given leaves to help strangers (i.e., cleanup at a local orphanage)? What if everybody wants to use their PTO entitlements at the same time after the disaster?

Employers must carefully consider, announce and get employee buy-in concerning a “you must work during and after the disaster” policy. Such policies should be calibrated to the nature of the business and severity of the disaster, e.g., “the emergency room staff must report to work for all storms but out-patient services will close if the hurricane becomes Category 2.” Employers should think about the application of a “you must work” policy before the disaster, considering such things as how long to wait before discharging for “no call, no show,” whether employees who are discharged for refusing to work will be eligible for rehire and what are the public relations consequences of firing employees who may have been rendered homeless by the disaster?

There are ways to avoid discharging good employees during/after a disaster. For example, employers have found surprising numbers of existing employees will volunteer to work, particularly if they are offered enhanced pay and benefits (because, of course, “volunteers” in this context means “willing to work” and not “work without pay”). It is advisable to get written agreements with volunteers about enhanced pay/benefits before disaster strikes. It also may be possible for employees to telecommute to their normal site or to transfer to other employer sites that are operational after the disaster, particularly if the company is willing to pay commuting or relocation expenses. There is no legally-imposed limit on distance for transfers to functional sites (that is, the employee generally can be discharged if unable/unwilling to work at a remote location, though the federal plant closing law (discussed below) says there is no employment loss if the transfer is within “reasonable commuting distance”). Finally, cross-training employees in other jobs/tasks before the disaster may allow those who are able to work to cover for those who cannot.

Plant Closing Issues

Federal law (the Worker Adjustment and Retraining Notification Act (WARN)) and laws in various states require larger employers to provide advance notice of workplace closures or mass layoffs to affected workers, state and local governments and any union representing the employees. Importantly, the laws often require notice of closing only one of a facility’s operating units. But there are WARN exemptions. If a natural disaster is directly responsible for terminations/layoffs – the plant is destroyed by a tornado – the employer need only give such notice as is “reasonably practicable.” If employment losses are indirectly caused by the disaster –an Illinois plant closed because its major customer in Florida was destroyed in a hurricane – the “unforeseen business circumstances” exemption under WARN may apply.

Volunteer Issues

Many employers consider using volunteers (both employees and employee family members) during natural disasters and subsequent cleanup/recovery, but there are a number of legal issues tied to such “free” assistance. First, if volunteers also are employees (that is, they offer not to be paid), there is the real potential for blurring the line between “employee” and “volunteer” work and thus violating the statutory obligation to pay for hours worked. If the once employee/now volunteer is performing services benefiting the company, he or she must be paid even if the “volunteer” work is unrelated to the normal jobs; for example, working on the employer’s disaster hotline would be compensable work even if the employee’s regular job is “truck driver.” Second, non-employee volunteers can be personal injury plaintiffs against employers if injured during volunteer work because, in most states, they are not covered by workers’ compensation insurance and, thus, employers do not have the usual workers’ compensation immunity. Third, because they often are not effectively screened and qualified before being used by employers, non-employee volunteers also can be the source of claims if they steal, injure others, etc. Finally, true volunteers can be converted to employees if they work for an extended period of time and are paid and controlled by the employer; obviously, if they become “employees” as a matter of law, volunteers have all of the employees’ rights and protections.

Part II of this article in the next issue of this newsletter will address wage/wage payment, benefits, “call up,” union issues and employee safety/health issues in the context of natural disasters.

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