Would Your Company be Ready For an Evacuation?

What should British companies do to prepare for business in North Africa and the Middle East?

Recent news of military extractions of company employees from the deserts of Libya has been gripping stuff. Who can turn away from the screen when compelling footage of Britons leaving in a C130 after days of fear in an isolated camp is shown?

After the immediate drama, however, other questions arise from the heightened threat to British employees and their dependents in the Middle East and North Africa.  How should British companies respond to the unrest? Did these companies know – or should they have known – of these risks when they selected the employees for offshore assignments. Did they think through the possible consequences of sending employees and dependents to countries where there is a heightened risk to their safety?  More broadly, what should British companies do to prepare for business in the region?  

It goes without saying that taking care of employees and their dependents is paramount.  Companies with experience in these situations know that, over and above the detrimental effect on employees – whether or not they have legal claims – the reputational damage to a company for failing to act or for acting ineffectually can be severe.

Companies should check employment contracts for their and their employees' respective responsibilities in these situations. The relevant provisions may be in a contingency plan or expatriate policy. Make sure that employees understand them and ensure that everyone is prepared to act quickly. Those companies that have thought through all the aspects of working offshore will have made sure that their employment contracts deal with the legal and practical issues in ways that address the needs of the personnel and of the business.

Those without contingency plans should check their employment contracts and expatriate policies and get plans in place quickly! Whether you will face legal claims from employees is an open question, but you can help yourself now by ensuring that, going forward, you act reasonably in all the circumstances.

While every company's situation is different, liability will be determined in part by whether the developing events were foreseeable – the answer may be different now than it was a few months ago.  Each company should be able to show that it considered a current risk assessment when assigning an employee to work in a particular country. Risk evaluations and contingency plans should be updated regularly and reviewed in light of changing circumstances.

The FCO needs to be an early port of call. Monitor the status of events in the affected country directly and through the FCO's and other governments' websites.  Ensure that you and the local British Embassy know where your employees and their dependents are and that your employees know to stay in touch. 

Now would also be a good time to see whether your insurance covers your potential losses. If so, follow its requirements, etc., for making a claim.  Please document everything.

The question of when to evacuate personnel is challenging. Many companies — and for that matter embassies as well — adopt a staged approach by first evacuating dependents and then those employees who are not critical to keeping the project or business running. This reduces the magnitude of the challenge should a complete evacuation become necessary.

Legally, unless the contract allows you to stop, your obligations to perform almost certainly continue and any decision to pull employees out of a country prematurely may be fraught with legal risk. Furthermore, local customers and partners are unlikely to view an early departure favourably, even if your contract permits it. 

Unfortunately, airlines rarely give much notice of flight suspensions and, even if they do, the chance of getting seats at the last minute is slim to nil. In the same vein, neighbouring countries can and will close their borders without taking your employees' needs into consideration. So if you fail to act when you have the chance, the choice may be taken away from you.

My 30 years of experience in Middle Eastern business and law, including in Baghdad during the Iran-Iraq War, suggest that sometimes the brave commercial decision pays off in the end, even if subsequently you have to negotiate through the legal and commercial consequences. 

In the context of Middle Eastern and North African projects, addressing the needs of offshore personnel early and regularly may not make for better nights' sleep for company directors when those employees are under threat, but will make a substantial difference in how the business fares at times like these.

This article was first published by Director of Finance online on 3 May 2011.