COVID-19 Potential Legal Issues for businesses
On 30 January 2020 the new Coronavirus (COVID-19) was declared a public health emergency of international concern by the World Health Organisation. The rapid spread of COVID-19 will have serious consequences for the Irish business community, we address some legal issues which business owners, managers and other individuals should consider over the coming months.
1. Risk Assessment / Crisis Management
It is crucial that every organisation conducts a risk assessment of their business and puts in place the appropriate preventative and protective measures to ensure that their employees, their suppliers and their customers/clients are protected. Furthermore, you must be mindful of your statutory obligation to ensure a safe pace of work. The health and safety of your employees while they are at work is your responsibility and one which you must take seriously.
The Safety, Health and Welfare at Work Act 2005 places a statutory obligation on employers to ensure the health, safety and welfare of employees while at work. To discharge this duty, employers must take reasonable steps to identify and address any health and safety risks within the workplace.
If the size and nature of your organisation requires it a response team should be established to put in place a crisis management plan and communicate this to all employees and any other relevant third parties.
It is essential that you at all stages comply with advices issued by the government itself and any other regulatory bodies which your business is associated with.
Communication with employees and stakeholders is key.
2. Employee Care
General Advice
It is imperative that you conduct a risk assessment to identify the likelihood of employees contracting the virus during the course of their duties. Issues such as means of transport to work, recent holidays etc should be considered. If certain employees are at risk of contracting the virus or suffer from underlying medical conditions these employees should be identified and dealt with appropriately.
The place of work should provide means for employees to wash their hands on a regular basis and supply hand sanitizer and face masks where possible. Staff should be educated on the appropriate preventative measures – this can be done by directing them to the appropriate government websites which provide such guidelines.
Work related travel should be kept to an absolute minimum and travel to infected areas should be done only in accordance with government issued guidelines. Face to face meetings should be avoided unless absolutely necessary for your business – any visitors to the premises should be asked to wash their hands and physical contact must to avoided; no hand shaking etc.
We attach the European Centre for Disease Prevention and Control protocol in relation to social distancing for reference.
Working from home / Staying at home
It is likely that the government will issue directions in relation to attendance at work in the coming days. If you have not already done so you should prepare your business for the fact that at some point it is likely that your workforce will be told to stay at home and where possible work from home. While some employees are set up to work remotely from home, the approach to be taken in relation to non-agile office staff should be considered.
Illness Benefit / Pay
Following consideration by the Cabinet Subcommittee on COVID-19 it has been announced that emergency legislation will be introduced in the Dáil next week which will see the following changes :
Illness Benefit rise from €203 per week to €305
Illness Benefit being available from the first day of illness rather than after 6 days
Illness Benefit being available to the self-employed
The removal of the requirement for a minimum number of PRSI contributions
The aim is that the new arrangements will be backdated to apply from Monday 9 March 2020.
Employees who wish to benefit from the new arrangement will need to test positive for COVID-19, if they are out of work due to another illness they are not entitled to this benefit.
Employers will need to consider whether or not to pay employees in respect of periods of self-isolation. While of course there are economic factors to be considered this is a global crisis and it is in the public interest that potentially ill people isolate themselves. If employees feel compelled to attend work for economic reasons they may not take the appropriate health measures which may ultimately result in even greater cost to your business.
Employees who seek time off to care for family members, may not have any entitlement to normal salary. Force majeure leave, annual leave or agreed other forms of leave may potentially apply. If you have a family crisis the Parental Leave Acts 1998 and 2019 give an employee a limited right to leave from work. (force majeure leave).
As an employer you need to be aware of all of the above considerations and legislation and make decisions on foot of same in line with the most updated guidance from the state.
3. COVID-19 and contracts
The global position in relation to the virus may mean your contractual partners are not in a position to fulfil their contractual obligations. Each contract will need to be assessed on an individual basis to determine whether the actions taken by the contracting parties amount to a breach of the contract or whether legal doctrines such as force majeure or frustration apply.
A force majeure clause is often inserted into contracts in order to excuse parties to a contract from performing their obligations under the contract or allowing them to suspend their obligations under the contact due to extraordinary unforeseen circumstances. This clause may provide you with protection if you cannot meet your contractual obligations as a result of COVID 19. Unless there is a specific force majeure clause in a contract you cannot rely on this as a principle.
In the event that the contract does not contain a force majeure clause you may be able to rely on the doctrine of frustration which acts as a device to set aside contracts where an unforeseen event renders contractual obligations impossible or makes the obligation to perform a radically different obligation from that initially envisaged.
It is advisable to review all contracts and identify if they have a force majeure clause which you may need to rely on at some stage.
4. Insurance coverage
Another obvious means of potential protection for your organisation are your existing insurance policies. It may be the case that you have insurance cover for some of the losses that may arise from COVID-19 such as public liability insurance, business interruption etc. All such policies should be carefully reviewed and advice should be obtained from your broker or insurance provider where necessary. Consideration should be given to any specific notification requirements, obligations to engage with your insurer and duties to mitigate your loss.
5. Conclusion
The COVID-19 situation is rapidly evolving and needs to be kept under review by all business owners, managers and individuals to constantly to ensure that you are up to date with the most recent recommendations and advice. It is your duty to ensure that you are exercising the best and recommended practice for your employees and business partners and the public in general.
As set out above you should conduct a risk analysis in order to ensure that you have a plan in place to minimise the potential operational and financial implications of COVID-19.
Difficult decisions will need to be made in the weeks and months ahead to first and foremost protect health but also to protect your business interests insofar as possible. All decisions taken should be in line with the recommendations from the government and any other relevant regulatory bodies and the rationale behind any decisions should be clearly documented least they come under scrutiny at a later stage.
For further advice on dealing with any of these issues above, please contact Anne-Marie James annemarie.james@kmj.ie , Alan Kirwan alan.kirwan@kmj.ie o
Yours sincerely,
Protocol on Social Distancing Mmeasures in-response to COVID-19