The rapid spread of COVID-19, aka Coronavirus, continues to have an immediate and adverse impact on businesses throughout the UK and after yesterday’s announcement that all UK Schools will close from this coming Friday and more restrictions to free movement of people likely to follow in the coming days and weeks, it is unlikely that the pressure on Employers will let up any time soon.
The Impact on UK Employers
Many Employers have seen demand for their products and/or services disappear almost entirely over a very short period of time and as the Coronavirus outbreak continues to spread rapidly and government-imposed restrictions continue to escalate, many Employers are quickly finding that they may no longer be able to provide work for all of their employees.
During these difficult and challenging times it is important to note that this unprecedented crisis doesn’t magically overwrite current employment legislation and provide employers with any special powers to circumvent existing employment laws, nor does it provide a viable defence in any subsequent employment tribunal claims that may follow in the event of knee-jerk reactions by Employers.
The only emergency legislation that has been passed was the amendment to regulation 2, The Statutory Sick Pay (General) Regulations 1982 (SSP Regulations) which was amended by the Statutory Sick Pay (General) (Coronavirus Amendment) Regulations 2020 to introduce a new regulation 2(1)(c), with effect from 13 March 2020. Regulation 2(1)(c) provides that a person is deemed incapable of work where he is:
“isolating himself from other people in such a manner as to prevent infection or contamination with coronavirus disease, in accordance with guidance published by Public Health England, NHS National Services Scotland(d) or Public Health Wales(e) and effective on 12th March 2020.”
To date, no other emergency legislation has been passed that would allow employers to be “flexible” with the terms and conditions of their employees or current employment legislation and therefore the normal rules still apply, unless or until further emergency legislation is introduced.
What can Employers do to mitigate the risk?
Redundancies are usually the last resort for Employers struggling to provide work for all of their employees but before pushing the redundancy button, Employers should explore ways of avoiding compulsory redundancies to minimise the impact on employees. Measures which may assist in avoiding compulsory redundancies include:
Asking employees to take paid holidays. Employers can require employees to take holidays at specific times provided they serve them the necessary notice (twice as long as the holiday being taken) unless the contract of employment provides for shorter notice or the employee agrees to a shorter period of notice.
Asking employees to voluntarily reduce their working hours. Any agreement to a variation to working hours and pay would need to be set out in writing. However, if employees don’t volunteer or consent to a proposal to reduce their working hours, and you are seeking to vary the working hours of 20 or more employees, you will need to undertake collective consultation either with a recognised trade union or elected employee representatives.
Introduce short time working or temporary layoffs. Where there is an express term in the contract of employment or an implied term by virtue of custom and practice, Employers can introduce short time working and/or temporary layoffs by serving the necessary notice. Some short time working, and temporary layoff clauses set out specific notice obligations and some simply require as much notice as is reasonably practicable so check your contracts to ensure you meet your contractual obligations.
What if there is no express or implied term in the contract of employment?
In the absence of an express or implied term in the contract of employment providing for short time working and/or temporary layoffs, Employers must tread carefully. Unilaterally imposing either measure could constitute a breach of contract and lead to claims of unlawful deduction of wages or breach of contract and constructive dismissal.
If you have already considered but ruled out asking employees to take holidays, you could propose a variation to their existing contracts of employment in order to introduce a short time working and temporary layoff provision, but this would need to be set out in writing and consent would need to be obtained from the employees. However, if employees don’t volunteer or consent to a proposal to reduce their working hours, and you are seeking to vary the working hours of 20 or more employees, you will need to undertake collective consultation either with a recognised trade union or elected employee representatives.
Redundancies. If after exploring all other options redundancies is the only way forward, Employers should first check the contracts of any bank workers, agency workers or contractors to determine whether these can be terminated. If this doesn’t alleviate the problem, then employee redundancies may be the only option and you will need to commence formal redundancy procedures which will require consultation. If the number of redundancies is 20 or more within 90 days, you will need to undertake collective consultation either with a recognised trade union or elected employee representatives.
Support for Employers
If you are an employer affected by any of the issues being created by the outbreak of Coronavirus and require further assistance and support, call us now on 0800 612 4772 or Contact us via our website.