Supporting your workforce is very important for businesses to function properly and grow, as when you gain the trust and commitment from your employees they’re more likely to work harder for you. Regular payment to your employees will make them happy and can enhance their mental wellness and performance, so you should always ensure that the finances are available. However, in the case of disaster, this isn’t always achievable.
There are many things that could be considered a disaster and affect payroll, including flooding, diseases, property damage and natural disasters. All of these can completely halt business operations and lead to your workforce not getting paid. Even less severe things like small payroll mistakes could be considered a payroll disaster and lead to over or underpayments for staff.
To further understand how you can protect your workforce, we have constructed this guide to instruct you on ways you can fund workforce wages even after a disaster hits. Continue reading to find out more.
What Constitutes a Payroll Disaster
Payroll disasters are anything that can have an immediate impact on your employee payments that you didn’t see coming and took you by surprise. As mentioned, this can be anything from a serious natural disaster that causes damages and completely stops your business from operating, or an unfixable payroll error that messes up your business finances. No matter the type of disaster, you need to ensure that you remain compliant and level-headed so that you treat your workforce fairly and protect their needs.
How effectively you respond to an incident that is affecting your payroll will come down to how severe the disaster is. These factors include:
- Business Health: Having a system in place should a payroll disaster take place can help with keeping your business flow healthy, so you can pay your staff on time.
- Incident Severity: If the disaster affects your whole workforce, it can be more difficult to manage. This makes effective planning crucial.
- Time Scale of Recovery: You need to estimate how long it’s going to take to get back to day-to-day business operations, so you can plan ahead with your finances.
How to Fund Your Workforce After a Disaster
Catastrophe Credit Insurance
Catastrophe credit insurance is often referred to as “whole turnover excess of loss” insurance. This protects businesses from any financial losses that come as a result of unexpected bad debts that arise from catastrophes. If an unexpected event gets in the way of your business operating, you could lose out on a lot of money. With this insurance in place, it means that you will be protected from major financial hardship.
Employee Assistance Programs (EAPs)
Your business should invest in EAPs to provide counseling and coaching services to employees through in-person, online and telehealth services. This can have several benefits, as it can give your employees the support they need that can help them figure out what they need to do on the back of financial losses after a disaster.
Disaster Relief Funds
Disaster Relief Funds are financial resources that are used to provide immediate and long-term assistance to individuals and communities affected by natural disasters, conflicts or other emergencies. You should set up a fund for your business after a disaster hits to ensure that your workforce is covered and their wages can still be paid.
Connect with Vendor Partners
Reach out to vendor partners to understand their capabilities and ensure they are prioritising employees affected by the disaster. This can also help with generating the funds required to protect your workforce, as vendor partners might be willing to support you in case a catastrophic event happens that impacts your business.
Ask For Donations
Your loyal customers are going to want to help out if there is a disaster that negatively impacts day-to-day operations. They will want your company to get back up and running as quickly as possible and this might only be achievable with their donations. Setting up a GoFundMe or something similar can be a very effective way at receiving donations after a disaster stops your business from functioning.
Conclusion
Safeguarding your employees’ financial well-being, especially through consistent and uninterrupted wage payments, is fundamental to business success and employee resilience. Proactive planning and the implementation of strategies like catastrophe credit insurance, employee assistance programs and even community support through donations, are crucial for ensuring your business can continue to support its workforce even in the face of unforeseen disasters.
Original Article: HR News
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