What is my legal position if emergency legislation to tackle the outbreak makes performance of a contract illegal or impossible?
As the coronavirus outbreak continues to develop, we have seen many countries begin to implement emergency procedures and legislation in an attempt to control the spread of the disease.
These have included bans on gatherings and public events, closures of shops, bars, restaurants and public spaces, and full lockdowns which restrict all but key workers to their homes except in certain limited circumstances.
This has a direct impact on businesses and their ability to operate. So what happens if a contract becomes impossible to perform because of emergency legislation?
For example:
- If you are a hospitality business, you have agreed to host an event, and gatherings are prohibited
- If you are a manufacturer or service provider, and your staff are required to remain at home, making performance of the contract impossible
Related FAQs
Increased hygiene measures should be introduced to limit the spread of infection. Increase the frequency of cleaning, particularly higher risk contact points such as door handles. Avoid the use and sharing of hardcopy in favour of electronic documents; avoid sharing of tools and work equipment; increase the availability of handwashing facilities and hand sanitisers; issue anti-bacterial wipes and tissues to staff, and remind everyone to maintain good personal hygiene practices, including regular hand washing. Prominent and repeat signage will be vital in reminding workers of these steps they can take to protect themselves.
PPE – e.g. disposable gloves and face masks – are not currently legally required in the UK, but especially where social distancing might not be possible, it may be necessary to make appropriate PPE available to staff. If so, you will need to make sure there is enough available train everyone so it used properly and provide for safe disposal of used items.
MOST IMPORTANTLY – communicate with your people; invite their input and suggestions and act on them. Communication and participation in the process of a safe return to work are going to be crucial to its’ success.
Monitor for illness: train managers how to spot the symptoms of COVID-19 and have a clear process if someone is potentially infected. Continue to remind staff to only come into work if they are well and not experiencing any symptoms. A number of businesses are planning on using testing and screening methods, such as temperature checks. Remember, these steps create data privacy considerations which you will need to consider.
Do not forget existing health and safety obligations, such as maintaining sufficient numbers of fire marshals and first aiders on-site. Employers should also be aware that the Health and Safety Executive must be notified under RIDDOR of any workplace incidents that lead to exposure to COVID-19 and any cases where there is “reasonable evidence” that it was caused by exposure in the workplace. Be aware that workers are being encouraged to report to HSE failures of their employers to keep them safe from the threat of the virus.
For those with variable pay, if the employee has been employed for a full 12 months before the period claimed for you, can take the higher of:
- The same month’s earnings in the previous year; or
- Average monthly earnings from the 2019/20 tax year.
For those who have been employed for less than one year you can use the average of their monthly earnings since they began their employment until the date they were furloughed.
If they have been employed for less than a month, work out a pro rata for their earnings so far, and claim for 80%.
On 18 March 2020, the Government announced that it would pass emergency legislation which would prevent landlords, both social and private, from bringing possession proceedings against tenants who are unable to pay their rent. The Housing Secretary, Robert Jenrick, stated that “no renter who has lost income due to coronavirus will be forced out of their home, nor will any landlord face unmanageable debts.”
The announcement came after several organisations, including housing charity Shelter, expressed concerns that more than 50,000 households could face possession proceedings due to the economic uncertainty following the Covid-19 outbreak.
If you have obtained a Grant of Probate or Grant of Letters of Administration there should be no need to complete an indemnity, merely an account closure form. If however you have not yet obtained a Grant but the bank is willing to release funds then they will generally require an indemnity to be executed. Several banks and building societies including Barclays, Lloyds, HSBC and Santander have signed up to the British Banking Association’s voluntary Bereavement Principles, one of which is to support the bereaved according to their personal needs and work with you to resolve everything as quickly as possible.
If the indemnity requires a solicitor to act as a witness, you should contact the bank to see what they are willing to do to get around the problem, given the current situation.
If your visa has expired or will do before you are able to safely leave the UK, you can apply for “Exceptional Indemnity” by contacting the Coronavirus Immigration Team. You will need to provide evidence as to why you cannot leave, which could include a positive Covid-19 test or evidence of being unable to make travel arrangements to leave the UK in time.
You should note that “Exceptional Indemnity” does not extend your leave, but temporarily protects you from adverse action being made against you as result of overstaying your visa.