COVID-19 and the Law

5 mins

This week, the Novel Coronavirus (COVID-19) and some of the legal implications it has thrown up in Australia.

It’s impossible to get around town these days without hearing some conversation about COVID-19. Let’s summarise some of the legal implications. If you can think of any others, leave a comment below!

[Update – 15 March 2020: Please note that the situation on COVID-19 is evolving quickly and any given situation may change in the coming days and weeks.

If you are looking for health information in Australia, please look to factual sources for health-related information such as the Australian Department of Health and ABC News websites.

If you are outside of Australia, please check out the World Health Organisation website.]

#1. Commercial contracts: Force Majeure

In the commercial world, there has been a lot written in recent days about how COVID-19 may constitute force majeure.

The term “force majeure” comes from the Roman law term vis major, meaning “superior force”. And in more recent memory, the French civil code (Article 1148 of the Napoleonic Code).

Force majeure is not recognised at common law as a doctrine in itself. However, parties can agree to include such a clause in their contracts. This would excuse a party from the obligation to perform its contractual obligations when a “force majeure” event arises.

A force majeure clause might look like this:

“The [parties] are excused from performance of any of their respective duties and obligations under this agreement whenever and to the extent that such performance is prevented or interrupted or delayed by reason of any action or requirement of any government authority or by any wars, public disorders, acts of enemies, sabotage, strikes, lockouts, labour or employment difficulties, accidents, breakdowns, fires, storms, tempests, hail, wind or events of nature or acts of God or any other causes beyond the control of the [parties], but the [parties] must at all times use all commercially reasonable endeavours to overcome or alleviate the effect of any such events as specified above.”
Gardiner v Agricultural and Rural Finance Pty Ltd [2007] NSWCA 235.

Note that there are many more garden varieties of force majeure clauses. Whether COVID-19 is a force majeure event is a matter of contractual interpretation. This will differ from contract to contract. As Spiegelman CJ noted in Gardiner v Agricultural and Rural Finance Pty Ltd [2007] NSWCA 235 at [55], lawyers should be wary about relying on existing cases on force majeure clauses.

As for anyone thinking of entering into a contract at this time—beware. The cases tell us that a party cannot rely on a force majeure clause if they knew circumstances (the subject of force majeure) were in existence at the time the contract was made. In other words, the party cannot argue that the event was not reasonably foreseeable: see Asia Pacific Resources Pty Ltd v Forestry Tasmania (No 2) [1998] TASSC 50.

#2. Public policy: Roll out the legislative amendments!

On 5 March 2020, the South Australian government amended the South Australian Public Health Act 2011 (SA) in the wake of COVID-19. It was described as “a move designed to give authorities greater powers to detain and isolate potential carriers”.

For a comparison of the previous Act and the current Act, check out this marked-up version I’ve created for you.

Otherwise, the key points are:

  • More powers over suspected cases – The Chief Public Health Officer has increased powers to give directions (and make detention orders) in relation to a “controlled notified condition” (e.g. COVID-19) where he/she has reasonable grounds to believe that a person “could have been exposed” to COVID-19. Previously, the powers only extended to a person who “has” COVID-19 or “has been exposed” to COVID-19.
  • My word! – The Chief Public Health Officer can now issue an “oral order” in relation to a person (i.e. not in writing) where “urgent action” is required.
  • No more roaming around – A stronger requirement for a person the subject of an order to “remain” at a specified place. Previously, a person had to “reside” at a specified place—which is loose drafting because it wouldn’t stop the person from roaming around during the day.
  • Magisterial intervention – The Chief Public Health Officer can seek to extend detention orders for persons who “could have been exposed” to COVID-19 beyond an initial period of 48 hours to the Magistrates Court. This contemplates COVID-19 testing and the possibility of extending the initial detention period.

#3. Employment law: Company policy on overdrive

Recently, a Melbourne company decided to email all its employees about its new COVID-19 policy. Any employee returning from overseas travel would need to quarantine themselves for 14-days. It then stated, “Your options are to take: (1) annual leave; (2) unpaid leave.”

This policy, even when taking into account OH&S laws, doesn’t quite pass the “sniff test”. The Fair Work Ombudsman notes on its website that:

“Under work health and safety laws, employers are required to ensure the health and safety of their workers and others at the workplace (as far as is reasonably practical). Workers also have responsibilities under those laws.

If an employee is at risk of infection from coronavirus (for example, because the employee has recently travelled through mainland China, or has been in close contact with someone who has the virus), you should request the employee seek medical clearance from a doctor and to work from home (if possible), or not work during the risk period. Where an employer directs a full-time or part-time employee not to work, the employee would ordinarily be entitled to be paid while subject to the direction. You should consider your obligations under any applicable enterprise agreement, award, employees’ contracts of employment, and workplace policies.

Under the Fair Work Act, an employee can only be stood down without pay if they can’t do useful work because of equipment break down, industrial action or a stoppage of work for which the employer can’t be held responsible. The most common scenarios are severe and inclement weather or natural disasters. Enterprise agreements and employment contracts can have different or extra rules about when an employer can stand down an employee without pay.

Employers need to balance their legal obligations, including those relating to anti-discrimination.”

In most modern workplaces where remote working is possible, employers who can’t prove that their employee has COVID-19 (but seek to enforce such a blanket policy) are choosing to swim in choppy waters.

#4. Then, ummm… assault

This week, Melbourne police charged two women after a punch up in a supermarket over toilet paper.

The toilet paper scramble is a mystery to half of the population, who are aware of something called a bidet. It has also spawned some unique Twitter hashtags such as #toiletpaperpanic and #toiletpaperwars.

I leave you with some of the more memorable tweets:

Further reading:

  • Fair Work Act 2009 (Cth), see in particular sections 94(5) (annual leave), 97 (personal/carer’s leave), 323 (payment) and 324 (deductions), and 524 (stand down).

Image credit // Claire Mueller

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