Will site visits, hearings and inquiries still take place?

Lay off is a temporary measure where an employee is required not to do any work by their employer in any given week and does not receive any salary for that period. This is sometimes used interchangeably to refer to redundancies; however, this is not correct and lay-off is different to redundancy.

Lay-off may be very useful to achieve short or medium-term cost savings in response to a temporary reduction in demand for products or services. Whether the employer has the right to implement lay-offs and how swiftly they can expect to be able to do so will depend on whether the relevant contracts of employment have specific provisions which deal with lay-off.

Short time working is where an employer temporarily reduces an employee’s working hours, with a corresponding reduction in their pay to less than 50% of their usual salary. This could be through reducing the number of working days, reducing the length of working days or a combination of both.

Short time working provides the employer with the ability to reduce staffing costs whilst providing flexibility in deciding the form of working pattern. As with lay-off, whether the employer has the right to unilaterally impose short-time working and how swiftly they can expect to practically implement this will depend on whether the relevant contracts of employment contain a short time working clause.

Where there is a contractual right to lay off or impose short time working: There is no strict process which has to be followed. We would advise transparent communication and confirmation in writing.

Where there is no contractual right: Imposing these options without a contractual right to do so will be a fundamental breach of the employee’s contract of employment. In these circumstances the employee’s options are: accept the situation and keep working; claim for lost pay; resign and claim constructive dismissal. The best approach for employers in these circumstances is to instead seek to agree lay-off or short-time working arrangements with employees.

Selecting employees for lay-off or short time working: There is no prescribed method for selecting which employees are to be laid-off or placed on short-time working, provided that the employee cannot argue that the method of selection is discriminatory in some way. We would advise selection based on objective business reasons.

Entitlement to pay during lay-off or short time working: Employees must be paid for the time they work. Additionally, while on lay off or short time working, an employee is entitled to receive statutory guarantee pay for the first 5 workless days in any 3-month period. The maximum statutory guarantee pay in any 3-month period is £150 (i.e. £30 for each workless day up to a maximum of 5).

Entitlement to statutory redundancy pay: Once employees have been on lay-off or on short-time working for 4 consecutive weeks or for a combined total of 6 weeks during any 13-week period, they may seek to claim a statutory redundancy payment (provided that they have two years’ service). There is a prescriptive process for this – please seek advice.

During these unusual times, we are all having to adapt to what has become the ‘new normal’ and implement changes in how we carry out civil cases. If you are to give evidence in a remote hearing, whether this is by Microsoft Teams, Skype for Business or the Cloud Video Platform, we have pulled together a quick and useful guide below on what would be expected by the courts:

Before the hearing

• Make sure that you have access to the video-conferencing software that will be needed for the hearing. We will tell our clients and their witnesses in advance which platform will be used. The courts have increasingly been using Skype for Business to conduct the hearings (but you may find other platforms being used)
• Test that your camera and microphone are working and it is clear to see/hear you.
• Dress appropriately, as if it was an in-person hearing, and use the same formalities.
• Ensure that the background which is visible on your screen is appropriate and allows for your face to be clearly seen. A ‘blur background’ option may also be available on your settings which you may prefer.
• Make sure that your mobile phone is on silent and you are in a location where there will be no/minimal distractions. You should be on your own in a room when giving evidence, however, as we have all experienced with working from home, sometimes interruptions such as children appearing cannot be avoided.
• Join the call ahead of the allocated time, in order to allow for any small technical difficulties.

During the hearing

• Have a copy of the hearing bundle to hand, so that you can follow the proceedings (this may be in hard copy or soft copy). You are not allowed any other notes or papers, whether hard copy or electronic, in front of you when giving evidence.
• Unless addressing the Judge or you have been directly asked a question, keep your microphone muted.
• When giving evidence, you must make sure both your camera and your microphone are switched on.
• Remote hearings can be difficult and if you do not understand or you do not hear a question properly, then do ask for the question to be repeated/re-framed.
• You should not move away from the screen without permission from the Judge. The Judge will allow time for breaks.
• Address the judiciary and other advocates the same way as you would if you were in a physical courtroom.
• It is permitted to drink water throughout the hearing, but mugs of tea and/or coffee are probably best avoided. It is also not permitted to eat food during the hearing.
• Don’t panic if someone walks into the room or the dog starts barking because there is a knock at the door. Judges are only too aware about what might happen. Communication is key and if the interruption has interfered with your train of thought or the evidence you are giving then do say so.
• Be aware that all evidence is recorded and that a transcript of all evidence can be obtained at a later date.

Crucially the phrase “force majeure” has no specific meaning in English law. As a result, there is scope for complex legal argument, including as to whether the effects of the coronavirus outbreak can amount to force majeure in the first place. If the coronavirus crisis deepens, force majeure provisions could become relevant in the following ways:

• suppliers to your business might seek to invoke force majeure
• you may need to invoke force majeure under your own contracts

Each of these will need careful analysis of the relevant contract against the applicable factual background. Unfortunately, the position is unlikely to be clear cut.

Hosted by NewcastleGateshead Initiative, Partners Damien Charlton and Jane Garvin discussed in this webinar contracts, managing supply chains and the role of directors, with  a particular focus on cancellation of events and businesses in the tourism and hospitality sector.

You can find a recording of the webinar from NGI here.

The outbreak is certainly going to have an impact on new lease negotiations.

Undoubtedly many transactions will be put on hold or indeed stop entirely. Where matters are ongoing, tenants may well look to strengthen rent suspension provision.

It is also possible that tenants and their representatives will also now seek to include termination rights for unseen events. In this regard, the concept of force majeure may start to appear more often in leases.

In both of the examples above, such attempts are not likely to be well received from landlords who will undoubtedly suggest that tenants ensure that their business interruption insurance policies are robust enough to protect the tenant in the event of any future pandemic events.

Another approach tenants might adopt going forwards in negotiations for a new lease (or indeed seeking to vary existing leases), is to move away from the traditional market rent model to a turnover rent arrangement. This will offer some protection going forward if trading conditions deteriorate, but again getting institutional landlords to agree such an approach may prove difficult.