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Risk management in tourism and hospitality is complex, involving aspects of adhering to statutory requirements, taking steps to ensure occupational health and safety requirements are met, and undertaking an analytical approach to mitigating potential liabilities. Most of the actions required need to be proactive by the operators; failing to do so may result in negative impacts to reputation, damage to property, fines, lawsuits, or in the most tragic result — injury to guests or employees. Companies not only have a moral and ethical responsibility to practise effective risk management, failing to do so can result in financial ruin and the cessation of operations.
This chapter reviewed an important consideration for tourism and hospitality professionals. Chapter 12 addresses another key component of the industry in BC, Indigenous Tourism.
Key Terms
- Breach in the standard of care: failure of the defendant to work to the recognized standard
- Capacity: the ability of a person to enter into a legal agreement; depends on the age and mental state of the person (among other factors)
- Causation: a strong link between the actions of the defendant and the injury to the plaintiff
- Commercial general liability insurance: the most common type of liability insurance that provides coverage for litigation; generally, legal costs and personal injury settlements arising from a lawsuit are covered
- Consideration: the value exchanged between parties in the contract (money, services, or waiving legal rights)
- Duty to care: the relationship between the plaintiff and defendant (monetary, supervisory, custodial, or otherwise) that requires a responsibility on behalf of one party to care for the other
- Employment Standards Act: defines legal requirements around employment such as minimum wage, breaks, meal times, vacation pay, statutory holidays, age of employment, and leave from work
- Exposure avoidance: a risk control technique that avoids any exposure to that particular risk
- Hotel Guest Registration Act: requires hotel keepers to register guests appropriately, which includes noting a guest’s arrival and departure dates, home address, and type and licence number of any vehicle
- Hotel Keepers Act: allows an accommodation provider to place a lien on guest property for unpaid bills, limits the liability of the hotel keeper when guest property is stolen and/or damaged, and gives the provider authority to require guests to leave in the event of a disturbance
- Inherent risk: risk that is inherent to the activity and that cannot be removed
- Injury: proof the plaintiff did in fact receive an injury resulting in damage; can be bodily injury or property damage
- Intentional torts: assault, battery, trespass, false imprisonment, nuisance, and defamation
- Liquor Control and Licensing Act: defines the ways in which alcohol can be made, imported, purchased, and consumed in BC
- Liquor Control and Licensing Branch (LCLB): the BC government agency responsible for legislation and control of alcohol sales, service, manufacture, import, and distribution in the province
- Loss reduction: a risk control technique that reduces the severity of the impact of the risk should it occur
- Negligence:failing to meet a reasonable standard of care toward others despite being required to do so
- Occupiers Liability Act: specifies responsibilities for those that occupy a premise such as a house, building, resort, or property to others on their property
- Perceived risk:the perception of the risk level of the practice, activity, or event; varies greatly from person to person
- Real risk:the actual risk of the practice, activity, or event; generally determined by statistical evidence
- Resort Associations Act: developed to provide opportunities to fund a variety of promotional services for a community; the Act defines what it means to be a resort community
- Risk: the possibility for loss or harm
- Risk management: practices, policies, and procedures designed to minimize or eliminate unacceptable risks
- Risk retention: the level of risk that is retained by the company through a conscious decision-making process
- Risk transfer: a risk mitigation strategy where the risk is transferred to a third party through contract or insurance
- Self insuring: the practice of an operation retaining the risk rather than transferring through insurance; may be a conscious choice or a necessity based on lack of available coverage
- Travel Industry Regulation: part of the Business Practices and Consumer Protection Act that outlines the requirements for licensing, financial reporting, and the provision of financial security for travel sales
- Unintentional torts: primarily consist of negligence
- Waiver: a document used as a risk management technique where the responsibility for the risk is transferred to the participant through contract and voluntary acceptance of risk
- WorkSafeBC: BC’s occupational health and safety organization
Exercises
- What is your personal level of risk tolerance? Would you consider it low or high? How does this change when you have responsibility for others?
- Think of a time when you have had a duty to care for someone. What was the relationship?
- Think of a tourism company you are familiar with. Develop a thorough list of all of the risks applicable to the company. Which ones concern you the most? How would you figure out which risks are the most concerning?
- What are four items that should be included in a waiver for it to be effective?
- Name three types of insurance relevant to tourism operators.
- Name the four elements of a negligence action that have to be proved in the courts in order for a claim of negligence to be successful.
- Under contract law, what does the concept of capacity mean? How does it relate to the issue of minors and their ability to sign a waiver?
- List and describe four BC statutes that apply to tourism and hospitality operations.
- Imagine you are working at the front desk of a hotel and you get a complaint that fighting and loud singing can be heard coming from a guest’s room. According to the Hotel Keepers Act, what steps are you required to take? What is the penalty to the hotel if you do not take the proper steps?
- Take a look at the frequently asked questions for the Employment Standards Act. List three benefits of the Act for employers and employees.
Case Study: Tort Law
In January 2015, a Kamloops woman sued Sun Peaks Resort Corporation after incurring a leg injury on the resort’s tubing terrain. The incident took place in 2013.
In court documents, Pamela Boileau said she visited the resort with her husband and two young children to use the tube park, where, she claimed, no signs were posted restricting the age of children allowed to use the facility. She then took a ride with her husband and their baby.
According to her filing, “the ride was very fast and bumpy and the tubes went high on the berm and then hit a big bump and the plaintiff’s infant daughter went flying out of her tube” (Petriuk, 2015). In order to help her daughter, Boileau stopped the tube she was riding in abruptly and broke her leg in multiple places.
According to Boileau, the next day the resort erected signage prohibiting children under four years of age from using the tubing park. She sued for general damages, special damages and interest, and money for past and future health care. The lawsuit named Sun Peaks Resort Corporation and four employees in the claim.
Based on this description of the claim, as circulated in the media, answer the following questions to the best of your ability:
- What evidence is there that staff at the resort had engaged in the four stages of risk identification? For each stage, note what the resort could have done differently.
- What were the real, perceived, and inherent risks of using the tube park? How would these be different for an adult participating in tubing and a small child?
- In your opinion, has the plaintiff established the following? Why or why not?
- Injury
- Duty to care
- Breach in the standard of care
- Causation
- Search online (terms: boileau, sun peaks resort) to find the updates on what happened with the parties involved. Did the outcome of the lawsuit differ from what you expected?
- What is your personal feeling about who is responsible for the injury in this case? How does that differ from what the law has to say?
References
British Columbia Ministry of Justice. (2015, April 15). Law basics – Liquor licensing in BC – Liquor Control and Licensing Branch. Retrieved from www.pssg.gov.bc.ca/lclb/LLinBC/basics.htm
British Columbia Ministry of Labour. (2015). Employment Standards Act. Retrieved from http://www.bclaws.ca/EPLibraries/bclaws_new/document/ID/freeside/00_96113_01
Canadian Tourism Commission (CTC). (2003a). Risk management guide for tourism operators. Ottawa, ON: Fitzgerald, P.
Canadian Tourism Commission (CTC). (2003b). Insurance tutorials for outdoor tourism operators. Ottawa ON: Valade, G.
Centre for Curriculum, Transfer and Technology (CCTT). (2003a). Health and safety in adventure tourism [PDF]. Retrieved from: http://bhudak.com/Health%20and%20Safety%20Guide.pdf
Centre for Curriculum, Transfer, and Technology (CCTT). (2003b). Risk management for outdoor programs [PDF]. Retrieved from: www.nic.bc.ca/continuingeducation/pdf/supply_lists/Risk%20Guide%20for%20Students.pdf
Cloutier, R. (2000). Legal liability and risk management in adventure tourism. Winnipeg, MB: Hignell Printing.
Destination BC. (2013). Tourism fundamentals guide. Retrieved from: www.destinationbc.ca/Programs/Guides-Workshops-and-Webinars/Guides/Tourism-Business-Essentials-Guides.aspx#.VLXXlb5JXHM
Dowling, G. (1986). Perceived risk: The concept and its measurement. Psychology & Marketing, 3(3), 193-210.
Enterprise Risk Management. (2004). A practical guide to risk assessment. [PDF] Retrieved from: hwww.pwc.com/en_us/us/issues/enterprise-risk-management/assets/risk_assessment_guide.pdf
go2HR. (2015). Health & safety. Retrieved from www.go2hr.ca/health-safety
Government of BC. (2015). British Columbia resort associations. Retrieved from www.cscd.gov.bc.ca/lgd/gov_structure/resort_associations/index.htm
Heshka, J. & Jackson, J. (2011). Managing risk: Systems planning for outdoor adventure programs. Palmer Rapids, ON: Direct Bearing Incorporated.
Hotel Guest Registration Act. (1996). Retrieved from www.bclaws.ca/civix/document/id/complete/statreg/96205_01
Hotel Keepers Act. (1996). Retrieved from www.bclaws.ca/civix/document/id/complete/statreg/96206_01
Importance of Liability Waivers in Recreation Programs, The. (n.d.). Retrieved January 14, 2015, from www.sms.bc.ca/2012/03/the-importance-of-liability-waivers-in-recreation-programs/
Karroll v. Silverstar Resorts. (1988). Canlii 3094 (BCSC). Retrieved from www.canlii.org/en/bc/bcsc/doc/1988/1988canlii3094/1988canlii3094.html
Longchamps, D. & Wright, B. (2007). Canadian hospitality law, liabilities, and risk. [PDF] Toronto, ON: Nelson Education. Retrieved from www.longchamps3e.nelson.com/instructor/03Ch03.pdf
Occupiers Liability Act. (1996). Retrieved from www.bclaws.ca/civix/content/complete/statreg/667588372/96337/?xsl=/templates/browse.xsl
Petriuk, J. (2015, January 16). Woman who broke leg on tube ride sues Sun Peaks resort for negligence. The Vancouver Sun. Retrieved from www.vancouversun.com/news/Woman+broke+tube+ride+sues+Peaks+resort+negligence/10735423/story.html#ixzz3POnvmUJb
Resort Associations Act. (1996). Retrieved from www.bclaws.ca/civix/document/id/complete/statreg/96320_01
Tort Law – An Introduction. (n.d.). Retrieved January 14, 2015, from www.duhaime.org/LegalResources/TortPersonalInjury/LawArticle-72/Tort-Law–An-Introduction.aspx
Travel Industry Regulation, Business and Consumer Protection Act. (2009). Retrieved from www.bclaws.ca/civix/document/id/complete/statreg/296_2004
WorkSafeBC. (2015a). Statistics for tourism & hospitality. Retrieved from www2.worksafebc.com/Portals/Tourism/Statistics.asp?ReportID=22495&_Type=Statistics-for-Tourism-Hospitality&_Title=General-Tourism
WorkSafeBC. (2015b). Our mandate. Retrieved from www.worksafebc.com/about_us/our_mandate/
WorkSafeBC. (2015c). Accident investigations. Retrieved from www2.worksafebc.com/Topics/AccidentInvestigations/Home.asp
