“Duty of care” is the new buzzword across the travel risk management industry, as corporate travel managers increasingly recognize their central role and responsibility in creating a strong, balanced business travel policy that protects their employees.
Though duty of care has existed in common law for a long time, the application of duty of care laws to the corporate travel community is a relatively new trend. The laws hold that it is the obligation of a company to maintain reasonable care of its employee during the course and scope of his or her business travel. In the corporate travel sector, duty of care extends to the safety and security of a company’s mobile employees.
In days past, bottom-line cost was the main business driver behind the implementation of a travel policy. Cost control, not traveler security, was paramount. It was common to hear corporate travel managers ask, what is the expense in booking tickets from a non-preferred vendor? What is allowable in terms of hotel stays?However, as economic growth has spurred travel to emerging markets and unfamiliar places, the rules of the game are changing. Safety has now become just as powerful a driver as cost.
This policy shift has prompted travel managers to ask questions in a different way. For example, what is the danger in reserving a car for my employee with a non-preferred rental car company? Are rental cars that are used well-maintained and up to date? How safe is it for my employee to stay in a hotel that has not been vetted? What is the hotel’s security policy? Clearly, the language surrounding travel expectations is changing to reflect a growing desire to mitigate threats and lower costs, but also to protect a company’s greatest assets – its people.
Duty Of Care 101
In most cases, duty of care implies that the employer is legally liable if an employee travels for business and needs any kind of intervention or assistance. “A responsive travel policy that strongly emphasizes duty of care has several layers,” states Bruce McIndoe, CEO of iJET, an intelligence driven provider of operational risk management solutions headquartered in Annapolis, MD. “These layers address the financial protection of the company, an integrated risk management component that emphasizes prevention, and the clear communication of norms and expectations regarding travel for employees.”
The United Kingdom sparked international interest in duty of care when it passed the Corporate Manslaughter Act in 2007. The law establishes significant consequences for companies who intentionally or unintentionally put their employees in harm’s way without taking sufficient precautions. The sub-phrase, “without taking sufficient precautions,” is key. “In a court case, it is not enough for a company to plead ignorance – and it is this ‘should have known’ theme that drives the need for corporations to establish relationships with the corporate intelligence community,” according to Stephen Barth, founder of HospitalityLawyer.com in Houston,TX. HospitalityLawyer.com brings together legal, safety, security information, resources and solutions especially designed for the travel, tourism and hospitality industries. “Furthermore, many corporations wrongly believe they are ‘covered’ under workers compensation laws, not realizing the limitations of such laws in wrongful death situations or in damage limitations,” he continues.
The Language Of Liability
There is no doubt that in addition to cost and safety, liability is a major concern behind duty of care policy. A recent online article entitled “Corporate Travel Safety” describes the work of Dr. Lisbeth Claus, who is a professor of human resources at Willamette University and author of the Duty of Care and Travel Risk Management Global Benchmarking Study. Claus’ research found that of the 39 cases she reviewed “in which an employer was sued by an employee (or his survivors) over failure to provide duty of care, the employers lost 34.”
Liability issues often spur travel managers to think about how to frame duty of care. For example, suppose a business traveler in Sao Paulo needs cash immediately and goes to his nearest public ATM. While withdrawing money, he is robbed at gunpoint by masked men. If the traveler has not been clearly informed by company policy that a particular activity (in this 33 Business Travel Executive FEBRUARY 2013 case, the use of public ATM’s) is considered risky, and is discouraged or unacceptable, then the company has breached its duty of care to its employee. Had the traveler known not to use public ATM’s in Sao Paulo, he would have obtained cash in another way and not become a target for armed gunmen.
This is also known as the “duty to inform” – “a person engaged in a special and potentially dangerous activity must know or inquire of possible hazards or of any special duties and responsibilities inherent in that activity that might affect their ability to exercise reasonable prudent caution.” Thus, a travel manager must inform an employee of what is expected regarding actions to be taken (such as immunizations), potential hazards (e.g. diseases, armed robbery), and any prohibitions (such as using public ATM’s). Ideally, the employer would communicate areas where the employee must take responsibility.
To explain this further, iJET’s McIndoe offers the following real-world example: “In one instance, an employee, while on a business trip to Vietnam, went on a white water rafting trip. The trip was on a weekend, tacked on after the business workweek. During the rafting expedition the employee was injured, hospitalized and had to be flown back to the US on a commercial airliner, with costs totaling $22,000. The employee sued his company citing that he was never informed of the fact that his company policy did not cover him after formal business hours. Had he known, he would have taken out a personal insurance policy that covered him throughout the entire trip.”
Another principle revolves around the duty to warn, which is less broad than the duty to inform. “Duty to warn” indicates that “a party will be held liable for injuries caused to another, where the party had the opportunity to warn the other of a hazard and failed to do so.” Since the language of liability can get complicated, it may be wise for companies to consult with risk management providers such as iJET or seek legal counsel beforehand.
Plan, Protect And Respond
In a world of competing interests, strained budgets and constant demands on time, how do companies meet their duty of care obligations? First, they can look to existing laws. They can also seek out similarly situated businesses and evaluate what their standard of care is. “In the travel industry, we have begun to set benchmarks and best practices for what a reasonable prudent business, university or NGO would establish in regards to duty of care in their travel policies,” explains Barth. “For example, do these policies promote awareness, education and training? Are they pro-active or re-active in nature? Are they spending dollars just on insurance, or on any kind of prevention programs?”
There are three levels of creating a duty of care travel policy:
• planning a policy that is specific to your company’s and travelers’ needs.
• protection clauses in the policy that inform, warn, track and/or protect travelers.
• response clauses including evacuation or other insurance services.
Planning is the first stage where corporate intelligence companies and comprehensive risk management providers can tailor a policy to suit a company’s size, scope and travel demands.
Protection clauses must then be analyzed to see what levels of services are appropriate. For example, is it enough for your employee to take a local taxi from the airport to the hotel? Or would it be more prudent for a vetted car service to pick up the passenger and drive to a (vetted) hotel? Are medical checkups required upon return from a foreign country? Other protective clauses such as “do not drink the local water in the city” or “only use bottled water” go a long way toward saving hours of lost productivity that would result from employees falling ill.
According to Barth, it is also reasonable to suggest general best practices for employees while traveling during the course of business, such as not wearing flashy jewelry which may warrant unwanted attention, or not to go out into certain sectors of the city at night time. Other specific best practices depend entirely on the threat level of the destination. In certain cities where crime is high, it may be recommended that employees going to dinner only venture out in groups of two or more. Or that they limit themselves to specific restaurants that have been vetted for food quality.
Response clauses define what measures are reasonable for a company to take on behalf of its employees to keep them safe. This includes a rapid response/evacuation plan that can react swiftly to an emergency. Other options are a comprehensive medical plan, an extraction policy, or a kidnap and ransom policy.
“Also, an employer may want to include traveler tracking as part of its response plan,” McIndoe says. Traveler tracking was highly successful during recent events such as the civil unrest that erupted during the Arab Spring, or the earthquake and subsequent nuclear fallout in Japan. “We recommend tracking for all travel, because a disruption can occur at any time…for example, a plane crash into the Hudson River in New York City or the bridge collapse in Minneapolis,” continues McIndoe. “How will you find and communicate to your travelers during these moments of crisis?”
Travel Ahead Of The Curve
In today’s fast-paced environment as corporations expand across an increasingly unpredictable planet, the workplace is not confined to one location anymore. Workforces and offices are mobile and travel is a necessary tool to get the job done. As language shifts in the industry to better capture a company’s travel needs, herein lies a golden opportunity for travel managers to incorporate strong duty of care policies and procedures intended to safeguard employees during the course of business travel.
At the end of the day, enforcing suggested duty of care best practices becomes imperative. Often times, corporate travel managers are faced with tough questions such as, “Is non-compliance punishable? If so, are employees who depart from company policy required to pay out-of-pocket for their non-compliance?”
Some travel programs encourage the creation of a “duty of loyalty” culture which rewards business travelers for booking through preferred vendors or avoiding potentially risky behavior during their business trip. Others advocate developing internal programming such as workshops, events and classes that teach the benefits of compliance with duty of care policies. This awareness and educational component empowers employees with the necessary knowledge required to manage travel expectations, and puts responsible decision – making back in their hands.