Lionel Paraire participates in the IR Global Disputes Virtual Series – COVID-19: Unprecedented Times, Desperate Measures
Foreward by Andrew Chilvers
The coronavirus pandemic has caused governments across the world to take measures that impact the movement of people rarely if ever, seen in peacetime before. Understandably, this has adversely affected businesses and created a host of employment law issues in every country.
When the first case of coronavirus – or COVID-19 – was reported in Wuhan, China in December 2019, nobody could have guessed that within three months it would spread across the globe at lightning speed. Indeed, from the start of March hundreds of thousands of cases of the disease have been reported in more than 160 countries and territories, resulting in thousands of deaths.
The speed of the spread of the virus – declared a pandemic by the World Health Organization on March 11 – caught governments across the world off guard. And many have since reacted with draconian action. This includes travel restrictions, quarantines, curfews and event cancellations, and advising people to avoid all but essential contact with each other for the foreseeable future.
Of course, this has had a tremendous impact on employment and with employment law in ways that have never been seen before. For instance, with employees being told to stay at home, flexible working has become more common than ever, although in some professions it just isn’t feasible. What this means for employers and employees – especially in terms of payment for those employees who have to take time off because they are sick, to quarantine or self-isolate, or to take care of dependents – has never been tested and different jurisdictions are reacting in different ways.
With the COVID-19 crisis and the response to it among different countries evolving daily, employment lawyers are advising employers on what they can or cannot do to safeguard their businesses and their employees under existing legislation. And the disease is spreading faster than laws can be adopted – although some countries are starting to respond quickly to take care of workers and ensure that businesses stave off bankruptcy.
How are companies responding to COVID-19 (the coronavirus) and what practical suggestions do you have?
Like the rest of the world, France is being confronted by the coronavirus epidemic (COVID-19) that is threatening our social and business activities. Employers must adapt to the virus’ progression and limit its spread.
Under French labour law, employers have a general safety obligation provided by law vis-à-vis their employees, requiring them to take the necessary steps to ensure their workers’ safety and to protect their physical and mental health. This is an enhanced duty of care, which means that employers can avoid liability if they can prove that they have taken all the preventive measures provided by the French labour code.
As regards the COVID-19, preventive measures will mainly depend on the business sector, but some of the following may be of interest:
- Cancel or postpone work travel, travel in general and planned conferences; extend remote working (if and when possible); do video conferencing instead of meetings;
- Set-up and update a map of risks (review the Plan for prevention of risks as the case may be) and prepare and/or update the Business Continuity Plan;
- Inform and train employees on hygiene measures (washing of hands, etc.) and distribute recommended individual and/or collective protective equipment (masks, hydroalcoholic solutions, etc) as the case may be;
- Liaise with the employee representatives (CSE, CSSCT) as well as the occupational health doctor in order to follow the spread of the epidemic within and around the company.
Failure to take preventive measures could expose the employer to legal risks, particularly if the infection of an employee is considered as an occupational accident or as an occupational disease, in which case the employer could face a liability action in respect of its potentially inexcusable conduct.
On March 19th, President Macron called on “businesses essential to our economy to continue their activity while complying with health and safety rules”. He referred to “the companies’ civic responsibility to continue their activity whenever possible”. The same day, this position was conveyed by the Medef (French employers’ federation) in a letter sent to all the companies’ heads in France to urge them to “imperatively continue to produce during this period of containment”.
Many companies have contemplated applying for partial activity, particularly after the Ministry of Labor announced an extension of the partial activity scheme by decree to be published in the following days. However, this does not necessarily mean that the coronavirus pandemic shall per se justify the partial activity.
The idea from the French government is as follows:
- Facilities open to the public which are listed by the decree dated March 15th, 2020 supplementing the decree dated March 14th, 2020 (bars, restaurants, cinemas, shops, etc.) must close unless this same decree authorizes them to continue certain activities because they are essential. For example, retail stores must close but supermarkets are allowed to continue their activity while respecting sanitary measures (“mesures barrieres”).
As a baseline rule, other businesses shall continue operating:
– either by having employees work from home. As stated by the Minister of Labor, “every work that can be performed from home shall be performed from home”;
– or by complying with sanitary measures i.e. social distancing, marks on the floor, implementing protection means around employees in contact with the public, making personal protective equipment available to employees, etc.,
- By exception, partial activity may be implemented. However, applications will be scrutinized by the administration. It is, therefore, necessary to justify partial activity for each establishment or department: supply issues, cancellation of orders, etc. It should be reminded that the partial activity scheme makes it possible to adapt the business to the decrease of activity depending on departments on a case by case basis. This could lead either to complete closure of some departments or only to a partial reduction of working hours.
The coronavirus is moving faster than the law – how are lawyers responding and adapting to this evolving crisis?
Even if the law is often moving slower than a crisis or society evolutions (e.g. the gig economy), the French government has been reactive and has already taken notable measures and regulations to inform the public and support business. In addition to the implementation of preventive measures, it is important to broadly communicate.
For example, the government has shared a Q/A in French (https://bit.ly/2WCv5P8), which is regularly updated in order to inform largely the population. From a labour perspective, the Ministry of Labour has also published a Q/A also in French (http://bit.ly/2QPNMvk) for employers and employees and keeps it updated according to the evolution of the spread. This includes:
- An emergency law to react to the COVID-19 outbreak dated March 23, 2020, has empowered the government to issue labour law Ordinances that will make it possible to delay the implementation of the partial activity. This law expresses a state of sanitary emergency throughout the French territory for a 2-month period starting March 24, 2020.
- In addition to the measures related to the limitation of circulation with which French people are now familiar, this law lists the various areas in which the government is empowered to enact bills, in order to safeguard public health and provides for economic, financial and social consequences of the COVID-19 outbreak.
- Under Article 11 of the emergency law the Government is authorized during 3 months to act in order to limit the shutdown of businesses and the impact on employment, on the following:
– set limitations on redundancies and mitigate the consequences of the decrease of business by facilitating and strengthening partial activity;
– enable the company or industry-wide agreements to authorize employers to impose or modify paid vacations dates, within the limit of six working days;
– entitle any employer to unilaterally impose or modify the dates of additional rest days in lieu of overtime (RTT), rest days provided by fixed annual working time agreements and rest days allocated to the employee’s time savings account, within the limit of ten days;
– enable businesses that are essential to the safety of the country or to the continuity of the economic and social life to implement more flexible working time rules, including weekly rest and Sunday rest;
– exceptionally modify the pay dates for mandatory and voluntary profit-sharing plans (accords de participation et d’intéressement);
– change the due date and payment conditions of the so-called “Macron bonus” (prime exceptionnelle de pouvoir d’achat dite “Prime Macron”);
- amend the process for information and consultation of the employee representatives, in particular, the Social and Economic Committee (CSE), to enable them to deliver solicited opinions within the appropriate time-frame and to suspend currently ongoing electoral processes of the members of Social and Economic Committees.
- Some of these decrees have already been published and some others will come over the next few days.
- The assistance of a lawyer is undoubtedly necessary to choose to prepare and implement preventive measures, but also to choose and implement the right recovery measure in order to limit the impact on the business activity.
How are specific industries or sectors and their employees impacted and what are the potential legal consequences?
Industries and business sectors will be affected in a different manner and in different timing, but all employers and employees will be affected at some point by the COVID-19. Companies that have businesses in China (like many French companies) have already been suffering production short breaks. Because of the weight of China in the production chain of numerous international companies, we can expect some direct consequences in many industries: automotive, pharmaceutics, construction; etc.
The epidemic will also heavily affect the tourism industry in France, the world’s premier destinations. COVID-19 will then endanger hotels, restaurants, airlines, conference centres and other professional events.
From a strict labour legal point of view, the urgency is now to deal with the temporary business interruption, i.e. working with fewer people (ill employees, parents of ill children, employees who have exercised their right to retreat from a situation that they perceive to be dangerous) and implement the right recovery measures.
This will have an impact on productivity and if the crisis continues, the business break will undoubtedly lead to redundancies over the next few months.