Corporates need to protect themselves from being sued when business trips go wrong, warns a leading lawyer
Companies could face rising legal bills and have to pay damages to employees caught up in major events such as terrorist attacks, hurricanes and other natural disasters.
The warning came from a leading European lawyer Carla Potok, who specialises in the corporate travel sector, during a session on safety and security in corporate travel held by Carlson Wagon Travel.
She said legal cases across Europe were putting more responsibility on to companies for what happens to employees when they go on business trips.
“Duty of care has been around for a long time and it used to be no more than an obligation by managers to the company’s shareholders,” said Potok. “But it is not just shareholders that are owed duty of care, now this includes all employees. This means that hospitality companies are holding the damages bag and having to pay damages if something goes wrong.”
Potok, who is also a professor at the EHL hospitality school in Switzerland, said the increasing number of “man-made and natural catastrophes” around the world was leading to rising claims from business travellers with more courts ordering employers to pay them damages for their injuries or distress suffered.
“It used to be the case that the company had to exercise its best efforts to secure the security of its employees,” she added. “But that has changed, the employers’ obligation is no longer to make best efforts, the obligation is to ensure the security of its employees.
“There was a landmark ruling in France when 21 people were kidnapped from a hotel in the Philippines – three of them were French and travelling for work. They were awarded damages from their employer because it was ruled as a work-related incident.”
She added that damages were also now being obtained by people who witnessed disasters and not just those who were directly affected.
“On 9/11, some Air France crew saw the events from their hotel rooms and then had to get on a flight coming back to France,” explained Potok. “They then filed a claim against Air France saying the airline didn’t supply psychological support at the time, and they were given damages.”
Potok said the situation for companies was likely to get worse because governments, particularly in Europe, did not have any money to pay victims so staff were taking action against their employers instead.
She added that companies needed to protect themselves by “anticipating and not waiting until things happen”, including the drafting of preventative contracts whereby employees agree to acknowledge the risk they are taking if they are travelling to a more dangerous or unstable destination.
“If they still want to go, then they have been warned about the dangers,” Potok said. “Get employees to sign a waiver when they are going to a risk-zone area which makes them take some of the liability. It’s also important to have inhouse training on crisis management.
“You can outsource this to an external risk management company – which is what CWT and Ijet are doing. But you have to inform users of these services. For example, you should make sure that they have some idea of who to contact if something goes wrong. This shows companies are taking all reasonable care to help clients get out of difficulties.”
CWT has signed a partnership agreement with Ijet International, which provides information and advice on safety and security issues, to create a new product for clients called CWT Safety & Security.
Andrew Winterton, president of suppliers, technology and products for CWT, added: “Safety and security is a very important issue and it’s more important when you consider the liability that corporations – without knowing it – are building up if they do not take the right procedures and policies. There’s a growing expectation from us as business travellers about what corporates are going to do to protect us.
“The critical thing is training – if you’re going to Nigeria you are going to need different training than if you’re going to Switzerland. Incidents happen and companies need to think ahead of how to manage them proactively.”
Ijet’s CEO Steve Hoffman said there was an increasing number of events that were disrupting travel and this trend was likely to continue.
“Technology such as social media is also causing situations to flare up because people can communicate quickly where they could not do so before,” he added. “But it’s not just the big events, as every day there is something that impacts on travel. Globalisation has also increased the need for more travel. The key things are planning, training and mentoring people. We have to be ready to react to help individuals out of situations.
“Travel disruptions don’t discriminate – you need to show duty of care and collaboration across the organisation. The severity and frequency of incidents continues to rise. We have to protect people as they need to travel to meet clients.”