“Lay-off” and “short time” are phrases that are being bandied about now because of COVID-19. Do you know what they actually mean from an employment law perspective?
“Lay-off” is defined in the Redundancy Payments Acts 1967-2014 and happens when the employer is temporarily unable to provide work for the employee.
“Short time” describes the situation where the employer cuts the wages or hours of the employee to less than 50% of the normal hours or pay.
The employee is supposed to be given notice, although no time period is specified, and the employer must reasonably believe it is only for a temporary period of time. Choosing employees for lay off or short term should be done fairly and in a way that will not give rise to a claim of discrimination.
The employer cannot, at common law, put an employee on lay-off without pay or place him on short time unless
There is a clause in the contract allowing lay-off or
There is an implied right to do so
The implied right would derive from custom and practice in the industry or in the particular employer’s business.
However, there has been decided cases in the WRC (Workplace Relations Commission) or the Rights Commissioner Service/Employment Appeals Tribunal that held there is an established practice in Ireland that lay-off without pay can be permitted where it can be shown that it is custom and practice in the industry/trade.
The employee may be entitled to redundancy. If she has been laid off or on short time for 4 or more consecutive weeks or for 6 weeks (not more than 3 consecutive) in a 13 week period the employee can serve a notice on the employer to claim redundancy. The employer, however, can serve a counter-notice denying the redundancy if he can give the employee 13 weeks work without lay off or short time. This work must be available within 4 weeks of the employee’s notice.
We all have an important role to play at this worrying time of Coronavirus/COVID-19. We need to follow the best medical advice by keeping face to face contact to a minimum and practice “social distancing”.
It is obviously in all our interests that we do everything we can to ensure the spread of COVID-19 is slowed down as much as possible. This will allow our health service to help those most in need, for example persons with an underlying condition or older people who are more susceptible to the effects of the virus.
So, we all need to do what we can in our own small way. Each and every one of us can play our small part.
And the best thing we can do now is follow the advice of the HSE public health experts and try to keep social contact and face to face meetings to a minimum. If we all do this we have a great chance to avoid the type of chaos you are seeing in Italy, and now Spain.
So, if you need legal advice or a consultation during this worrying time we can give you a consultation by phone, email, or video, without any difficulty.
Our office remains open and we can meet face to face because there are some necessary face to face meetings-for example for the signing of contracts, statutory declarations, or affidavits.
But we are trying to avoid them if email, phone, or video will do the same job and not carry any of the risks.
Will you be paid if public transport is shut down due to Coronavirus/Covid-19?
Will you be paid if the schools close and you have to mind children at home?
Will you be paid if you have to self isolate?
These are some of the questions touching upon employment law which are causing workers a great deal of concern and anxiety.
Let’s take a look at some possible scenarios.
The employee contracts Covid-19
The employee’s sick pay entitlements, if any, will be those set out in the contract of employment and/or staff handbook. There is no legal or statutory entitlement, however, to sick pay. The employee may be entitled to illness benefit from the Department of Employment Affairs and Social Protection.
2. The employer closes down but the employee can work from home
The employee is entitled to be paid, assuming she is working.
3. The employer closes down but the employee cannot work from home
There is no entitlement to be paid and a temporary lay off situation may arise. An alternative is for the employee to take any accrued but untaken annual leave, in which case he would be paid.
4. The employee cannot come to work because she is caring for a person who has Covid-19
Force majeure leave may be applicable in this situation. However, the maximum amount of force majeure leave is 3 days in a 12 month period and the care must be for a close family member with the employee’s presence indispensable in the circumstance.
5. Public transport closes down and the employee cannot get to work
Unless there is provision in the staff handbook for pay it is extremely unlikely that the employee is entitled to be paid.
6. School has closed and the employee must mind a child
If the employee can continue working she would be entitled to pay. If she cannot work parental leave or annual leave or unpaid leave may be a possibility. Unpaid leave will need the agreement of the employer, however.
7. The employee returns from an infected area and the employer tells him to self-isolate
There is no entitled to be paid, unless the employee can work from home. However, if the employee was required to travel to the infected area at the request or direction of the employer, or in fulfilling his contract of employment, he would have a strong argument to be paid whilst self isolating on his return.
If the employee was returning from a holiday to an infected area he would have no entitlement to sick pay if required to self isolate but he may be entitled to illness benefit from the Department of Employment Affairs and Social Protection.
Illness benefit and Covid-19 (Coronavirus)
New measures have now come into effect regarding illness benefit. Three big changes include
The 6 day waiting period for illness benefit will not apply to any person who has Covid-19 or is in medically-required self-isolation
Illness benefit will increase to €305 per week for a maximum of two weeks for anyone in medically required self-isolation or for the full absence from work on account of a diagnosis of Covid-19
the normal social insurance requirements for Illness Benefit will be changed or the means test for Supplementary Welfare Allowance will be removed
Does force majeure leave offer any relief to employees in the current Covid-19 crisis?
Or does it create even more problems for employers who are already concerned about the many implications arising from the spread of the virus in Ireland?
Force majeure is defined as a “superior force” and is afforded statutory recognition in Irish law in the Parental Leave act 1998 as
13.—(1) An employee shall be entitled to leave with pay from his or her employment, to be known and referred to in this Act as “force majeure leave”, where, for urgent family reasons, owing to an injury to or the illness of a person specified in subsection (2), the immediate presence of the employee at the place where the person is, whether at his or her home or elsewhere, is indispensable.
(2) The persons referred to in subsection (1) are—
(a) a person of whom the employee is the parent or adoptive parent,
(b) the spouse of the employee or a person with whom the employee is living as husband or wife,
(c) a person to whom the employee is in loco parentis,
(d) a brother or sister of the employee,
(e) a parent or grandparent of the employee, and
(f) persons of such other (if any) class or classes as may be prescribed.
(3) When an employee takes force majeure leave, he or she shall, as soon as reasonably practicable thereafter, by notice in the prescribed form given to his or her employer, confirm that he or she has taken such leave and the notice shall specify the dates on which it was taken and contain a statement of the facts entitling the employee to force majeure leave.
(4) Force majeure leave shall consist of one or more days on which, but for the leave, the employee would be working in the employment concerned but shall not exceed 3 days in any period of 12 consecutive months or 5 days in any period of 36 consecutive months.
(5) A day on which an employee is absent from work on force majeure leave in an employment for part only of the period during which he or she is required to work in the employment on that day shall be deemed, for the purposes of subsection (4), to be one day of force majeure leave.
Force majeure clauses in employment contracts
Some executive type contracts of employment may contain a force majeure clause, and most employment contracts will refer to the statutory relief provided for force majeure in the Parental Leave Act 1998.
A force majeure clause will usually have the effect of suspending the obligations of one or both parties in certain exceptional circumstances. That is to say, events like storms or earthquakes or other acts described as “acts of God” may qualify as force majeure events as envisaged by the contract.
However, there is no presumption in Irish law of a force majeure event, thus the parties need to specify what events are intended to be covered by the force majeure clause. Without this clarity the clause may be unenforceable on the grounds that it is void due to the uncertainty and lack of clarity around it.
The precise scope of the force majeure provision will depend on the context in which it is used: ‘A force majeure clause should be construed in each case with a close attention to the words which precede or follow it, and with a due regard to the nature and general terms of the contract. The eﬀect of the clause may vary with each instrument.’ (Lebeaupin v Crispin  2 KB 714)
Is Covid-19 a force majeure event?
It is worth noting that the phrase force majeure has no recognised or widely accepted meaning in English law.
The question, therefore, of whether Covid-19 is a force majeure event is a question that will almost certainly be determined by the particular circumstances of the contract and what was envisaged, what type of work was involved, whether performance of the contract was genuinely prevented by the coronavirus, and so forth.
The “force majeure event” should be defined in the force majeure clause in the contract. For example:
“Force Majeure Event” means an event, or a series of related events, that is outside the reasonable control of the party affected (including power failures, industrial disputes affecting any third party, changes to the law, disasters, explosions, fires, floods, riots, terrorist attacks and wars).
If a dispute arises, however, it is likely that a Court will interpret the clause strictly and narrowly.
Force majeure clause examples
Each Party shall be excused from liability for the failure or delay in performance of any obligation under this Agreement by reason of any event beyond such Party’s reasonable control including but not limited to Acts of God, fire, flood, explosion, earthquake, or other natural forces, war, civil unrest, accident, any strike or labor disturbance, or any other event similar to those enumerated above. Such excuse from liability shall be effective only to the extent and duration of the event(s) causing the failure or delay in performance and provided that the Party has not caused such event(s) to occur and continues to use diligent, good faith efforts to avoid the effects of such event and to perform the obligation. Notice of a Party’s failure or delay in performance due to force majeure must be given to the unaffected Party promptly thereafter but no later than five (5) days after its occurrence which notice shall describe the force majeure event and the actions taken to minimize the impact thereof. All delivery dates under this Agreement that have been affected by force majeure shall be tolled for the duration of such force majeure. In no event shall any Party be required to prevent or settle any labor disturbance or dispute. Notwithstanding the foregoing, should the event(s) of force majeure suffered by a Party extend beyond a four-month period, the other Party may then terminate this Agreement by written notice to the non-performing Party, with the consequences of such termination as if this Agreement had expired (and was not terminated) in accordance with Section xxx.
Force Majeure. Notwithstanding anything to the contrary contained herein, neither party shall be liable for any delays or failures in performance resulting from acts beyond its reasonable control including, without limitation, acts of God, acts of war or terrorism, shortage of supply, breakdowns or malfunctions, interruptions or malfunction of computer facilities, or loss of data due to power failures or mechanical difficulties with information storage or retrieval systems, labor difficulties or civil unrest. Notwithstanding the foregoing, in the event of such an occurrence, each party agrees to make a good faith effort to perform its obligations hereunder.
Force Majeure. A party shall not be liable for any failure of or delay in the performance of this agreement for the period that such failure or delay is
beyond the reasonable control of a party,
materially affects the performance of any of its obligations under this agreement, and
could not reasonably have been foreseen or provided against, but
will not be excused for failure or delay resulting from only general economic conditions or other general market effects.
Each party would normally be obliged to serve some notice on the other party and inform the other party as soon as possible of the difficulty or impossibility of performing the contract and suspending it for a time.