After the outbreak of the Coronavirus in China, it seems the virus is spreading across Europe at a record-breaking speed. The new infection cases are increasing day by day in Belgium. Has your business been prepared for a possible outbreak?
The Coronavirus could impact the performance of your contracts, affect your employment, even seriously disrupt your business, are there any legal solutions to all those challenges? Below are some useful answers to the most frequent questions you may encounter in the coming weeks.
Employment
1. Q: Is the employer obliged to provide protection (masks, disinfect products etc.)?
Yes, the employer needs to make sure that the work is carried out in proper circumstances with regard to the safety and health of the employee.
The World Health Organization (WHO) points out a number of specific preventive measures that are best taken in the workplace to prevent the spread of corona virus in the workplace:
• Make sure your workplaces are always clean and hygienic;
• Promote regular and thorough hand-washing by employees, contractors and customers;
• Advise employees and contractors to consult national travel advice before going on business trips;
• Put sanitizing hand rub dispensers in prominent places around the workplace;
• Others.
2. Q: Can the employer refuse an employee entering the workplace?
I. If the employee shows no symptoms of the coronavirus but has returned from an affected area?
No, as long as there is no medical certificate confirming that the employee is unfit for work, the employer cannot deny access to the workplace
However, the employer is also responsible for the safety and health of the employees at the workplace. Therefore, it would be reasonable to take other appropriate measures (e.g. provide a separate workspace). The World Health Organization (WHO) has issued a guidance for businesses and employers, which outlines simple ways to prevent the spread of the virus and things to consider when employees travel: https://www.who.int/docs/default-source/coronaviruse/getting-workplace-ready-forcovid-19.pdf?sfvrsn=359a81e7_4.
Be aware of the fact that the employer cannot require the employee to undergo a medical examination (you can however make this suggestion) or submit a medical certificate that proves that they are not infected. It is only possible to verify the medical certificate once this has already been issued by a doctor initiated by the employee.
II. If the employee shows symptoms of the corona virus?
Yes, we are of the opinion this would be possible in accordance with article 20 of the law on employment contracts if there are clear external signs of illness. After all, the employer has the obligation to take reasonable measures to guarantee the health and safety of the employees at the workplace.
However, the FOD WASO has communicated that as long as the employee has not been declared unfit for work by a medical certificate, the employer cannot refuse him access to the workplace.
They also add that safety measures are possible (and even required) with explicit reference to the example that the employer may, in consultation with the employee, decide to temporarily organize the work differently (e.g. homework or telework, use of other rooms, etc.).
In addition, the FOD WASO accepts that the employer can ask an employee, who is clearly ill, to go home for the safety of the other employees and to obtain medical advice. If the employer is of the opinion that the employee’s condition unmistakably increases the risks associated with the workstation of the employee, the employer may contact the occupational doctor, who will then assess whether it is necessary to subject the employee to a health assessment with him. The employee must then immediately comply with his assessment.
3. Q: Can the employer oblige all employees to work from home?
The FOD WASO has communicated that as long as the employee has not been declared unfit for work by a medical certificate, the employer cannot refuse him access to the workplace.
They add that safety measures are possible (and even required) with explicit reference to the example that the employer may, in consultation with the employee, decide to temporarily organize the work differently (e.g. homework or telework, use of other rooms, etc.). An obligation unilaterally imposed by the employer does not seem acceptable by the FOD WASO.
4. Q: Can the employer shut down the plant if the government has given recommendation?
Yes, in order to prevent the further spread of the virus, it is possible that plants will have to close. In this case, the company could invoke temporary unemployment due to force majeure (question 5, ii).
This will be applicable at least up until March 31, 2020.
The employer must file an electronic declaration as soon as possible with the appropriate unemployment office of the company’s place of business containing evidence of force majeure and the link between the corona virus and the force majeure. Check the website of the National Employment Office for the other formalities.
I. During the shut-down period, does the employer have to pay?
During this period, the employers does not have to pay any salary. If certain conditions are met, employees receive an unemployment benefit from the National Employment Office.
In this case, the employee and the employer are able to convert these days into leave days (impossible in the case of a collective leave in the company) with mutual consent to regain the right to a full salary.
5. Q: What about the salary/unemployment allowance?
I. If the employee is infected by the coronavirus and is unfit to work:
If an employee is unfit to work due to the corona virus, he will benefit from the same protection as any other Belgian employee on sick leave if they can provide the required medical certificates.
The employees will be entitled to guaranteed pay from their employer for a certain period of time.
II. If the company is experiencing serious business disruption due to the coronavirus:
If (some of) the blue collar employees would temporarily stop working due to economic reasons (i.e. lack of work), the employer can invoke temporary unemployment (due to economic reasons). For white collar employees, this is only possible on certain conditions.
The employees will be entitled to a replacement income from the National Employment Office for the days of inactivity. The employer must file an electronic declaration as soon as possible (see question 4).
III. If it is impossible for the employees to work due to consequences of the coronavirus (when the employee is for example forced into quarantine or if the employee cannot return to Belgium from a holiday)
In this case, the employee is not unfit to work, but the company can invoke temporarily unemployment due to force majeure.
This will be applicable at least up until March 31, 2020.
The employer must file an electronic declaration as soon as possible with the appropriate unemployment office of the company’s place of business containing evidence of force majeure and the link between the corona virus and he force majeure. Check the website of the National Employment Office for the other formalities.
During this period, the employer is no longer obliged to pay the remuneration. The employees receive a temporary unemployment benefit from the National Employment Office for the days of inactivity.
6. Q: Can the employer oblige the employees to use annual leave?
No, this is only possible if the employee agrees with this annual leave, unless a fixed collective holiday is already planned according to the applicable provisions.
Commercial contracts
1. Q: Is coronavirus outbreak a force majeure event?
Because force majeure clauses are usually contained in commercial agreements, the scope and effect of a force majeure clause is determined on a case-by-case basis, by reference to the wording of the clause and the relevant facts mentioned in the contract.
If the contract or the terms and conditions don’t include a force majeure clause, you must apply the rules of the applicable law of the contract.
According to Belgian law “force majeure” means the absolute or practical impossibility, beyond the power or control of the contractor, to perform the contract.
This means that each case will need a very factual assessment to know whether the coronavirus can be interpreted in that particular case as ’force majeure’ or ‘absolute impossibility (beyond your power) to perform’.
2. Q: If my Chinese supplier cannot deliver, can I terminate the contract and ask for refund?
It is important to consult the specific terms of your contract and look into the governing law provision.
- If the contract is governed by Belgian law:
You can terminate the contract if the contract provides that termination is possible due to a force majeure event.
If the contract doesn’t provide such specific provisions, according to Belgian law, you can only terminate the contract in case of force majeure (absolute impossibility, beyond your supplier’s power, to perform) or in case of an accountable and serious failure on the part of your supplier. In case of force majeure you can’t ask for refund, each party shall bear his own risk. In case the nondelivery can’t be interpreted as a consequence of a force majeure event, the nondelivery or serious delayed delivery can be interpreted as an accountable serious failure on the part of your supplier. In this last case, you can terminate the contract and you must be placed in the situation in which you would have been if you had not contracted with your supplier. This means the request of refund is possible.
- If the contract is governed by the laws of PRC:
Under the PRC contract law, the contract can be terminated due to a force majeure event, defined as an objective circumstance which ‘cannot be foreseen, cannot be avoided and cannot overcome’, and this applies regardless of any provision in the contract. If the delay or failure of supply by your Chinese supplier is directly caused by the virus outbreak, such as the temporary closure of plant due to government orders, then it is possible to terminate the contract. Refund of full amount or partial amount of your prepaid price will depend on the execution status of your suppliers. For instance, if the supplier has already manufactured the products, then only partial refund will be possible. In such case, you can also consider adjusting the delivery timeline instead of terminating.
3. Q: Can I suspend the performance of contracts with customers? Do I have to pay damages?
It is important to consult the specific terms and conditions of your contract. If the contract is governed by Belgian law and no specific provisions on suspension of your performance are included, the suspension of the performance of the contract, without any liability, is only possible in case of temporarily force majeure (only a temporarily absolute impossibility, beyond your power, to perform) or as a reaction on your customer who is not performing his former obligations of the relevant contract. The temporarily nature of the situation of force majeure can give rise to discussion because it depends on a very factual interpretation.
Special new measures
1. Q: Are there special measures adopted by the government to support companies in difficulties?
The federal government has adopted ten measures to support companies which are “directly affected” by the coronavirus. Those ten measures include the temporary unemployment allowance for force majeure reasons, temporary unemployment allowance for economic reasons which have mentioned above in the Employment section.
In addition, the following measures were adopted:
1. Social securities (employer part) in the first two quarters of 2020 can be paid by monthly installment within 18 months. Any fine or interest in curred due to delayed payment of social securities can also be partially or totally exempted.
2. VAT can be paid monthly, as similar to the payment of social securities (employer part);
3. Payroll tax can also be paid monthly;
4. The payment of income tax for individuals and for companies can be delayed;
5. The independents can reduce their anticipated payment of social securities;
6. For the independents, the social securities in the first two quarters of 2020 can be paid one year later;
7. In case the independents have temporarily suspended its activities due to the coronavirus, they are entitled to receive replacement revenue;
8. The federal governments will not impose any fines or sanctions in case public tender projects are affected.
