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  • Writer's picturePeter Lamont, Esq.

Here's How to Protect Your Business from the Next Natural Disaster

With hurricane season in full force, mother nature’s ability to impact business and the economy cannot be ignored. As Texans and Floridians work to rebuild their lives after hurricanes Harvey and Irma, hurricane season is not even close to being over yet.

Natural disasters such as tornadoes, floods and hurricanes, bring widespread destruction to anything and everything that crosses its path, small businesses included. In a lot of instances, small businesses impacted by such natural disasters are unable to ever recover and are ultimately forced to permanently close their doors.

When a small business owner thinks about planning for natural disasters, they think about securing their store fronts or work sites along with complying with any applicable OSHA and related guidelines, along with ensuring adequate insurance coverage is in place to cover any losses. However, one of the most commonly overlooked areas of disaster preparedness is the development and implementation of a business continuity plan. With just a small amount of time, small business owners can develop a solid plan and strategy for avoiding serious and costly business disruptions caused by natural disasters.

What is a Business Continuity Plan?

A business continuity plan is a set of rules, information, and actions that are established by a business well before any disaster actually occurs. Think of it as a fire drill that might be run in a commercial building or a fire plan that you might establish in your own home so that your family knows what to do in the event of a fire. Obviously, there is no point in developing a fire plan after the fire has started. The same holds true for a business continuity plan. Developing a plan is an action that business owners should do when they first establish their business and it should be updated every year. The purpose of the plan is to make sure that during and after a disaster the business and its employees can continue to be productive and successful.

How is a Plan Established?

The easiest way to build a business continuity plan is to write it out. Most business owners find it incredibly useful to create forms and checklists. These forms or checklists need to include the businesses’ essential resources.

Some business owners choose to create physical forms and binders while other opt for electronic solutions. One element to be aware of when selecting the electronic-only option is that natural disasters can often result in the loss of power and/or internet and communication systems. It is important that any electronic-only disaster plans be accessible in the event of power or internet outages. Most business owners, even those who are considered “tech savvy”, usually have a hard-copy backup of their business continuity plan in a safe place. When disaster strikes, it is always a good idea to not have to rely on computers or electronic devices to keep the business up and running. Old fashioned paper solutions can often be the difference between a company’s survival of a disaster.

The typical business continuity plan should be broken down into a number of critical information types.

What Elements or Assets Should Be Included in the Plan?

Human Resources

Business owners should create a list of employees, independent contractors, suppliers, vendors and critical contacts. In the event of a disaster, it is important that your team knows what to expect and how to proceed, even if communication systems are disrupted. It is important to assign roles to certain key employees so that essential business operations can continue. This includes key business factors like equipment, interim workspaces, information, records management and backup of any other vital elements needed to sustain business operations.

For example, team members need to be prepared to secure rental equipment in the event that company equipment is destroyed or rendered inoperable following a disaster. Team members also need to be assigned to secure temporary work spaces, whether it is a commercial space or setting up a makeshift workspace in other team members’ homes.

Business owners also need to ensure payroll continuity for employees in the event of a disaster. It is important to establish policies for direct deposit, overtime pay during the disaster, and what to expect financially if the business is not operational. It is nearly impossible for employees to focus on business matters when they are concerned about their personal finances. Payroll continuity is critical for keeping the status quo during a disaster.

Business Operations

While the operations of the business are generally tied into human resource elements, there are many separate factors that require additional planning. These additional critical business functions include accounts receivables, payment of debts and financial obligations, compliance with regulatory deadlines, and supply and project delays. For example, most contractors cannot survive if there is an extended interruption of payment of accounts receivable. Plans should be established to make sure that their accounts receivable remain active and that the business is actively receiving payments.

Business Continuity Plan Meetings

An essential part of any business continuity plan must include regular staff meetings to discuss the procedures. Some business owners hold annual meetings while other hold them quarterly. While it might not be necessary for smaller companies to have quarterly meetings, it is critical that meetings are held at least once per year. Business owners should regard these meetings as the final key to overcoming a disaster. These meetings are essentially fire drills that need to be conducted so the staff is prepared when the potential disaster occurs.


The world is an uncertain place with natural disasters, war and other threats to businesses arising out of nowhere can be life threatening to a business. In order to survive disasters, businesses need to create, implement, and discuss a business continuity plan before the unexpected occurs.

If you would like more information about this topic or have general legal questions, please feel free to contact me at (201) 904-2211 or via email at We answer legal questions on a daily basis and would be happy to discuss any issues or questions that you have with you. #askpjlesq © 2017, Law Offices of Peter J. Lamont & Associates. This Update is provided for informational purposes only. It is not intended as legal advice nor does it create an attorney/client relationship between the firm and any readers or recipients. Readers should consult counsel of their own choosing to discuss how these matters relate to their individual circumstances. This Update may be considered attorney advertising in some states. Furthermore, prior results do not guarantee a similar outcome.



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