Winston Hotels is a national hotel chain based in Orlando, Florida. The company employs 2,100 staff members in the United States, of which 118 are employed in the home office, 256 are employed in hotels in the Orlando area, and 1,726 are employed in hotels outside of Orlando. In 2004, Hurricane Charley blew through Central Florida and was followed by two other hurricanes within a 30-day period. During each of the three hurricanes, the two Orlando hotels were damaged by falling tree limbs and the accumulation of rainwater in some rooms. The company required employees to work around the clock in these hotels even though the home office and the Orlando hotels lost power for one to three days during each hurricane. In addition, many telephone lines in Central Florida were down for various periods of time during these hurricanes. Some workers refused to work around the clock since they or family members had suffered major or minor damage to their homes and were attempting to arrange repairs or rebuilding. All of these employees were dismissed. One employee gained notoriety by appealing his dismissal based on his citizen’s right to protect his home and property. He and his lawyer stated that this right superseded his employment contract. In addition, some employees filed a lawsuit against the company because they were promised a higher pay scale for working continuously during the hurricanes. However, after the hurricanes, management decided either not to pay the employees for all of their extra hours or not to pay them overtime rates. Still other employees filed lawsuits because the company failed to provide adequate sleeping accommodations or food for those employees who remained on site. George Baker is director of human resources for Winston Hotels. He has been told by lawyers representing the company that the lawsuits would be easier to defend if the company had a disaster preparedness plan in place to deal with extraordinary events such as hurricanes, floods, earthquakes, volcanoes, SARS, bird flu, bioterrorism, and other terrorism events. Baker knows that while the probability of any one of these occurring is very low, the company will function more smoothly during such events, recover more quickly, and be less vulnerable to lawsuits if it follows a clearly communicated disaster plan. Up to this point, the company has had no disaster plan and managers “played it by ear” when the hurricanes struck. The only policy that existed was a general policy that each employee had to either report to work during his or her scheduled work hours or give adequate notice so a replacement could be scheduled. No possibility for extraordinary circumstances was provided in the policies. Many of the lawsuits are still under appeal by the company and have not yet been resolved. Baker is very aware that the company is vulnerable to lawsuits and large financial losses as a result of not having a disaster plan. Yesterday he read in The Wall Street Journal that his company is not alone; 75 percent of all employers do not have a disaster plan. The article went on to say that the disaster plan needs to include policies and procedures for addressing employee absenteeism, operating with a reduced workforce, communicating with employees and customers, addressing payroll and employee benefits policies, addressing supply shortages, providing back-up electricity, maintaining information technology, maintaining security, assuring occupational health and safety, and minimizing litigation. In groups of two to four students, answer the questions below.
QUESTIONS
1. What policies and procedures do you suggest George Baker propose to his company to address each of the areas identified above in The Wall Street Journal (i.e., employee absenteeism, etc.)?
2. Given the central Florida location of Winston Hotels, what types of disaster threats are most likely to occur and why? Which disasters are most likely in your current location?
3. What are the components of today’s corporate disaster plans with which you are familiar? Access company Web sites to determine the components of existing plans. Are these plans adequate to address the challenges of various kinds of disasters? If not, what additional policies or procedures would you suggest?