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PAYTECH is the industry's primary source for payroll information. The monthly magazine covers payroll management, technology, new and pending legislation, professional development, and trends shaping the payroll industry and profession. All APA members receive PAYTECH as a benefit of membership, and the magazine is published monthly, except for an August/September combined issue. PAYTECH is available to members in both print and digital formats.


Have a Disaster Preparedness Plan Ready for All Emergencies

BY: Tricia Richardson, CPP, SPHR, SHRM-SCP | 01/31/19

“Neither snow nor rain nor heat nor gloom of night stays these couriers from the swift completion of their appointed rounds.” Although this saying has been attributed to the U.S. Postal Service, it could apply to any payroll professional I‘ve ever met. Payroll happens regardless of the circumstances. Many of us have processed payroll through different types of natural disasters and emergencies.

Snow storms, flooding, hurricanes, earthquakes, fires, tornadoes, active shootings, loss of electricity, and countless other disasters do happen. Despite these emergencies, business must continue. When emergencies occur, business operations may look different for a time, but business must go on. 

So, how can businesses facilitate continuity during a disaster? First, complete a business impact analysis and use it as a starting point for your company’s disaster recovery plan. Remember to discuss, prepare, communicate, and regularly test and tweak that plan until you know that payroll processing can occur no matter what emergency is thrown your way.

Discuss Business Impact Analysis

Your business impact analysis will kick-start discussions about the impact of disaster recovery and how to mitigate costs. This analysis should review:

• Income losses
• Expense increases (equipment, off-site location, overtime, etc.)
• Ability to meet production deadlines for current contracts
• Insurance coverage. How protected is your company if a disaster should occur?

Then, at a minimum, the management team, IT department, HR, payroll, and the accounting department at your company should be part of the early planning and discussions. In speaking with my payroll and human resources colleagues, I have found that these employee areas are often excluded. This exclusion is not intentional. On-time payroll processing is usually a given. No one ever thinks about it not happening.

Prepare the Plan

The management team should facilitate communication with employees, vendors, and the community. The IT department should discuss the logistics of hardware, software, and internet connections, etc. Human resources has a vital role in developing a plan for the emotional well-being of employees. Based on the emergency, grief counseling or workers’ compensation may need to be involved. Payroll has an equally vital role.

Employees must be paid. Payroll happens even if the usual means to provide a check have been disrupted. An accurate employee paycheck must happen. This paycheck may be the only means employees have to obtain food and shelter.

General items to consider include:

• Types of disasters that could occur.  
• Key staff. Who needs to be available and ready regardless of the circumstances?
• Recovery time guidelines. When must each department be operational?

Specific to payroll, there are other items to consider. These include:

• Service Organization Controls (SOC) Audit Report. If you outsource your payroll, your payroll provider should have a disaster recovery plan.
• Resources. What will the payroll department need—laptops, printers, check stock, a mobile hot spot?
• Work area. Where will the key payroll staff work? Home may be an option, but you should also prepare an off-site disaster recovery location and the means to get there. Have a primary site and a backup site.
• Payroll processes that can be completed manually. You may be able to handle these aspects of the payroll until more automated tools are available.

Communicate the Plan

Employees should know your company has a plan. You would be surprised at how comforting this is. This will show employees that you are prepared, you care about the business operations, and you care about employee welfare. Disasters affect employees both at work and at home. Give employees direction and guidance on how they can prepare at both places. Make sure your employees always have access to the plan. One tool you could use to accomplish this vital communication is a specific company website URL. For example, you could create a website like www.yourcompany.com/disaster-preparedness-plan and direct employees there.

Note: If you outsource your payroll, make sure your payroll provider has a copy of your plan. It may be able to assist with the payroll processing.

Test the Plan

Putting a plan on paper and outlining all the steps might look perfect and seamless, but how do you know if it will flow smoothly when implemented unless you test it? Do you have enough laptops? Do you have enough hot spots available? Is your communication chain or disaster plan URL effective? Is employee contact information up to date? 
Most businesses conduct fire drills at regular intervals. Your business should do the same with your disaster recovery plan. After the plan is tested, ask for feedback. Each employee will have a different experience, and considering those will only solidify your plan’s effectiveness.

Helpful Resources

These resources are available to assist with the planning phase:

1. The U.S. government offers guidance on building an emergency kit at www.ready.gov. If the disaster occurs during working hours, your employees should be prepared to shelter in place for a minimum of 24 hours. Not all of the items listed below may be necessary at your company, or you may need to add a few more. The government recommends a kit that includes:

• Water—one gallon of water per person per day for at least three days, for drinking and sanitation
• Food—at least a three-day supply of non-perishable food
• Battery-powered or hand crank radio and a NOAA weather radio with tone alert
• Flashlight
• First-aid kit
• Extra batteries

2. The IRS may give extensions to various tax filings based on the emergency. For updates to these offerings, register for IRS alerts.

3. You may be required, by law, to have a plan. The Health Insurance Portability and Accountability Act of 1996 (HIPAA) requires disaster recovery for any HIPAA-covered entity. This rule requires companies to have:

• A data backup plan
• A disaster recovery plan
• An emergency mode operation plan
• A set of testing and revision procedures
• Data criticality analysis and applications

Employers should always have a plan in place to handle any issues or concerns that arise at a workplace. Our business has employee handbooks to outline expectations, rules, and regulations. We have user guides and help desks. Chances are, your business will experience a disaster. Be prepared and have your tools for business survival ready.



Tricia Richardson, CPP, SPHR, SHRM-SCP, is the Account Relationship Manager for Paytime, Inc. She is a member of APA’s National Speakers Bureau and the Board of Contributing Writers for PAYTECH.
 

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