Many employers have questions and concerns about how COVID-19 may impact on their employment obligations. We have set out some guidelines below (current as at 18 March 2020):
- The Government requires all people returning from any country except the Pacific Islands to self-isolate (stay at home) for 14 days after their return.
- The Government recommends that people who have been in close contact with a person who has a confirmed case of COVID-19 to self-isolate for 14 days from the date of exposure.
Health and Safety at Work Act 2015
- All employers have duties under the Health and Safety at Work Act 2015 (“the Act”) to ensure, so far as is reasonably practicable, the health and safety of their workers, and other persons who may be at risk from work carried out by the employer.
- The Act requires employers to eliminate or minimise risks to health and safety so far as is reasonably practicable.
- Enforcing “self-isolation” in accordance with the Ministry of Health’s guidelines is likely to be considered a reasonable response measure to eliminate or minimise the risks of the disease. Not doing so could expose an employer to liability under the Act.
- Employers should monitor and be guided by the Ministry of Health’s guidelines, which are frequently updated.
- Depending on the nature of the business, and an employee’s particular circumstances, additional measures to eliminate or minimise the risks presented by COVID-19 may be necessary under the Act. Please contact us for advice specific to your business.
Leave and pay
- Where an employee is directed to self-isolate by an employer outside of the Ministry of Health’s guidelines, and an employee cannot perform work in isolation (for example by working from home) the employer is generally obliged to fully remunerate the employee. The general presumption is that an employee should not be disadvantaged by a direction from their employer not to work, where they are willing and able to perform the work.
- Employers should not require employees to use sick leave or holiday entitlements to cover any periods of employer directed self-isolation (in lieu of a Government requirement to do so) or those employers may be liable to a personal grievance claim based on an unjustified disadvantage.
- Where employees cannot work as a result of mandatory Government directed self-isolation (such as when returning from any country, other than from the Pacific Islands) those employees are generally not entitled to remuneration. Employers could agree (but are not required) in these circumstances to offer annual leave, sick leave, or annual or sick leave in advance during this time.
- Where an employee refuses to come to work for fear of catching the disease but does not have the virus, nor are they required to self-isolate, the general presumption is that they are not entitled to be paid during their absence. Employers could agree (but are not required) in these circumstances to offer annual leave, sick leave, or annual or sick leave in advance during this time.
- Where an employee contracts the disease, or is required to stay home to care for a spouse or dependant who is sick, that employee is entitled to use sick leave. Once an employee’s sick leave entitlement is exhausted, employers could agree (but are not required) to offer annual leave, or annual leave or sick leave in advance to cover a period of illness.
- · Employers should assess their entitlements to the Government’s support package introduced on 17 March 2020, which includes wage subsidies and leave payments.
Employment agreements and policies
- Employers should have a good understanding of any relevant terms contained in their employment agreements and policies, and any decision made should be in accordance with those terms.
- Force majeure, business interruption and other such provisions may be applicable as this situation unfolds however we suggest advice is sought before relying on such provisions, given their technical nature.
- While we are all hopeful businesses will be able to make it through this difficult time, there may be unfortunate situations where the impacts of the disease necessitate urgent review of costs, and potentially business restructuring. In that situation the employer has obligations pursuant to the Employment Relations Act 2000, along with their individual employment agreements and/or collective agreement(s). Alternatives to restructuring should also be explored, such as a temporary suspension of business.
This is a novel issue and involves intersecting and complex obligations imposed by multiple pieces of legislation, including the Health and Safety at Work Act 2015, Employment Relations Act 2000, and the Holidays Act 2003.
The above are general guidelines and we suggest employers take advice on their specific obligations relating to the management of COVID-19.