CKL BUSINESSES - WORKING AT HOME HAS SURGED - YOU'RE ALSO NOW ONLINE TO SURVIVE - SEVEN STEPS FOR PREPARING FOR AN IT FAILURE AND TO REDUCE YOUR LIABILITY RISKS

Due to the pandemic, the surge in work-from-home arrangements has caused strain and pressure on information technology (“IT”) providers.

Internet broadband providers, cloud-based businesses and virtual private network operators (“VPN”s) may be unable to keep pace with the new IT requirements for their clients’ businesses (collectively, “IT Providers”).

The result may be business interruption, additional time required to manage IT-related issues or other unanticipated resource allocation. 

To protect your business and prepare for this change in the IT world, you should:

[1]      Review your contract with your IT Providers:

  • is there a “force majeure” clause, or any clause addressing the interruption of IT services due to a health emergency or other reason?

For more information from us about non-performance clauses in contracts during COVID-19, go here: http://wardlegal.ca/the-virus---does-it-cancel-contracts-rental-agreements-separation-and-parenting-agreements-maybe---read-on

  • is there any clause about a material change in circumstances (i.e., adverse change) that may be triggered due to COVID-19?
  • is there any clause about whether temporarily not provide IT services will constitute a breach of your contract?
  • is there any clause in the contract that may limit or exclude the liability of the IT provider for non-performance?
  • is there any clause that imposes a time limit, or procedure by which, your claim must be made against the IT Provider, if any?
  • is there any clause requiring you to “mitigate” your damages and, in any event, should you discuss any available alternatives with the defaulting IT Provider, or arrange for another IT Provider to provide your services?

[2]      Check your commercial insurance policies:

  • do you have business interruption coverage?

For more information from us about this coverage, go here: http://wardlegal.ca/31582887996638

  • do you have emergency or public health coverage?
  • do you have any coverage that may be triggered due your IT Provider’s failure to provide services to you?
  • discuss with your broker whether such is available, if you do not have it, and consider amending your policy for that coverage
  • make sure you know what, if any, notice requirements you have vis-à-vis your insurance company if your IT Provider fails to perform, including if you intend to make a claim as a result

[3] Get your contingency plan ready:

If you may experience non-performance by your IT Provider, consider:

  • doing a full assessment of your business and its operations in terms of reliance on IT services;
  • evaluating the potential impact of non-performance by your IT Provider on your ability to continue your business; and
  • identify other options and have your contingency plan ready.

[4]      Get your workplace policy implemented for working-from-home (i.e., remote) arrangements:

  • implement your policy and have all employees acknowledge and agree, in writing;
  • consider incorporating:
    • productivity expectations;
    • action plan in the event of the failure of an IT Provider; and  
    • reporting system for any IT disruptions.

[5]      Get your date breach/privacy protocol workplace policy in place, as required by law

[6]      Monitor IT services carefully to detect any failure or breach and carefully record any incident

[7]      Carefully monitor e-fraud during the pandemic, which is rampant, including:

  • any requests for payment, especially any request to change payment or account details;
  • ensuring your employees speak personally with the third party to verify the payment arrangements;
  • check and double-check emails addresses and other contact information for third parties where funds are involved, including based on historical information;
  • always ask for confirmation via a new email (not a chain); and  
  • act quickly and decisively if fraud is detected.

 


Thank you for reading this - Calvin Chan of WARDS LAWYERS PC.

If you would like to read more, please go to wardlegal.ca/posts.

This WARDS LAWYERS PC blog is for general information only. It is not legal advice, or intended to be. Specific or more information may be necessary before advice could be provided for your circumstances.

More information? We're here to help - calvin@wardlegal.ca | www.wardlegal.ca