North Bristol has been hitting the headlines for many reasons, but not least is the large fire at the Premier Inn at Cribbs, Bristol, last week; causing huge traffic disruptions on connecting roads, excess of smoke and general business chaos for Premier Inn and nearby businesses. This unexpected event has prompted this blog; here we will review the best steps for your business from an HR perspective, should an unforeseen event occur and how best to manage and support your staff during a business closure.
An unexpected business closure may occur for a number of reasons, often weather or hazard related; such as flooding, snow disruptions, power supply failures or a fire – when these such events or a state of emergency is declared, the decision to close a workplace may be taken out of an employer’s hands.
The question many employers ask first is, when unforeseen circumstances strike and an unexpected business shutdown is announced is –
‘Is the business obliged to pay its employees?’
In short, the answer is ‘Yes. Staff are legally entitled to be paid if they are set and willing to attend work even if their employer is unable to provide work’. Unless there is a contractual right to lay employees off without pay, or employees expressly consent to being laid off without pay (but this is often without exceptions and we’d recommend discussing this with a HR Consultant should you think this is the case), they will be entitled to receive their normal pay for the duration of the closure.
If an employer fails to pay employees there is high risk that employees may claim for an unlawful deduction of wages, or even claim unfair constructive dismissal (if they resign as a result of the non-payment) on the ground that there has been a fundamental breach of their contract of employment.
You do however need to check your contracts, if staff are genuine zero hours workers, as is often the case in hospitality, they may only be entitled to payment for the hours that had been agreed with them on the published rota or assignment.
Commonly, businesses will be insured and some of the damages will be recuperated through insurance claims, including any lost income arising from the event. However, insurance claims do not support the business with the immediate pressures and demand on cash flow, and with nothing incoming during this period it does have a significant financial impact. Depending on the event which caused the closure, the length of time a workplace is shut will vary and this will impact the next steps a business takes. If, for example, the catastrophe of a fire was to take place which resulted in huge damages to premises the business may have to consider relocating business premises entirely or demanding an official shutdown for a period of time; many weeks or even months until the refit and refurbishments are completed.
During this period of unrest, it’s vital to ensure communication is clear to employees from the outset. Updating them with knowledge and time frames as much as possible, it will be an unsettling time for all involved and it is important employees are listened to. If the employees have been directly impacted by the event, support should be provided to ensure their mental wellbeing is cared for.
If the business foresees the event resulting in a temporary closure, there are options available to reduce the cost of staffing until the business is safe and functioning again, these might include…
- Working remotely/from home
- Agree reduction on hours
- Lay offs and short time working
Working remotely/from home
In the age of cloud computing where most things are available remotely from any PC that can access the internet, remote working is likely to be the easiest fix and will mean most businesses can be fully functional again fairly quickly. However, remote working isn’t viable for all businesses, hospitability and leisure sector businesses will struggle to complete work from home, unless the employee is office based already. It does serve as a good reminder to ensure paper files are backed up electronically, to an offsite server and a process is in place for documentation in case of an emergency.
If you are large enough to have more than one site, like the Premier Inn team (lots of these hotels in Bristol), then hopefully you can redeploy staff (and customers) to another site, this not only helps staff by ensuring their income is maintained, but also helps you retain those skills you have developed.
Agree reduction of hours
For a short-term temporary basis, you could agree with staff to vary their working hours to help reduce the salary bill. It’s vital you have mutual agreement from the employee and need to be careful that there is no undue pressure or influence.
Lay offs and short time working
Prior to laying off an employee you need to check their employment contract allows this, if it does, you have the option to ask an employee to stay at home or take unpaid leave – this is only valid when the business cannot offer paid work.
Short-time working is when an employee works reduced hours or is paid less than half a week’s pay.
Laying off staff or short-time working can help avoid redundancies – but this has to be agreed with employees first.
This is the last resort and ideally, the aim is to support and accommodate all employees however in business we do understand it isn’t always that simple and sometimes difficult decisions need to be made.
Making employees redundant is bringing their employment to an end on the basis of a workplace closure expected to be more than 4 consecutive weeks. A fairly strict process should be followed and advice taken from a HR expert to guide you through this, to ensure it’s fair and as stress free as possible for both parties involved.
Health & Safety Policy
On a separate note and with the recent local fire in mind, perhaps now is the time to revisit your Health and Safety Policy and fire regulations, ensuring these are routinely checked and be sure you’re up to date with your fire risk assessment; remember prevention is always better than cure! We sincerely hope the Bristol Premier Inn Team, Cribbs are all safe and well and hopefully the damages are manageable.
If you come across any questions regarding any of the above options, please do get in touch with you usual HR Consultant whom can advise further or contact us directly on 0844 854 6407 or e-mail firstname.lastname@example.org.