Business travel putting companies at risk

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Companies are not adequately preparing their staff for overseas travel, while also failing to realise they may hold some liability for any employee misadventure – including those outside of working hours, according to a recent survey.

The study, carried out by medical and travel security and risk services company International SOS, found nearly 10 per cent of respondents said their companies do nothing to prepare them for overseas assignments and do not arrange travel or provide briefings or pre-departure assessments.

“Pre-travel briefings, knowing what constitutes a risk in the locations employees are travelling to and understanding each traveller’s personal profile should be included in pre-departure preparation,” International SOS Regional Security Director, Simon Francis said.

Under the new Workplace Health and Safety (WHS) legislation, Australian companies have the same legal duty of care to their travelling workers as their local workers. Under the Model WHS Laws businesses and individuals that fail to discharge the duties imposed upon them are exposed to criminal prosecution, and if found guilty could receive a criminal offence conviction.

Francis said corporates have to a degree been unaware to their obligations under WHS as it applies in an overseas worker/business traveller context.  But with these changes companies need to reassess their situation and identify their exposure to the risk.

One key area where companies are falling short is building in approval process to the right level and not putting in due diligence measures which could have costly consequences.

“The directive liability takes on new meaning because if they don’t have these compliance measures in place to show they’ve taken the practical steps to check the boxes, to make sure they’ve done the assessments and put in place risk mitigation measures, then the directors of the company and the managerial staff in that chain can be liable,” Francis told Corporate Risk and Insurance.

Carrying out risk assessments of the destination and having the traveller sign a drugs and alcohol policy, or expected behaviour policy can help protect the company. Francis said, “At the very least [business travellers] should be advised of the risks and explained what’s not appropriate and not allowed. If the travellers then choose to step outside that the organisation has at least carried out its due diligence… and can protect itself from potential litigation from a traveller that chooses to disobey or ignore the recommendation from the organisation.”

There are other consequences of not carrying out pre-travel risk assessments or putting in place appropriate measures. While insurance will pick up medical tabs or reimburse for theft there is a knock on effect from those cases that can affect a business.

If the incident hits the headlines the business’ reputation is put at risk, time lost when a person is injured, costs associated with backfilling or recruiting someone to take an injured persons place and damage to morale.

“These are all below the line, typically uninsurable risks that would impact the c-suit dramatically,” Francis said.

International SOS recommends the following tips to help organisations comply with the new Model WHS Laws:

  • Identify which of the laws are applicable to your business activities and identify to which workers a duty is owed
  • Review existing safety management systems and identify any gaps that need to be filled to achieve compliance
  • Update policies and procedures to cover any gaps
  • Identify who in the business are ‘officer’ under the legislation and have appropriate governance arrangements in place to assist them to exercise ‘due diligence’.

Do you carry out pre-travel risk assessments? Take part in our poll here.

Look out for Thursday's edition of Corporate Risk and Insurance where we look at the part gender plays in business risks and identify risks that you may not have thought of.

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