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When Tough Gets Even Tougher

Richard B. Johnson

Co-Founder + Partner
November 19, 2021

As COVID appears to be waning somewhat, many British Columbians have now been thrown into a new state of emergency. We want to provide some general guidance for employees and employers dealing with the current emergency circumstances caused by flooding and mudslides.

As employment lawyers, we are being asked to advise on what happens when a business needs to temporarily close due to supply chain constrictions, property damage, or how to respond if employees are unable to physically get to work.

These situations raise very important legal issues which should be assessed on a case-by-case basis. However, there are some general items to keep in mind:

  1. Firstly, employers and employees are both interested in having business and work continue, so by engaging in open, honest and transparent conversations about what they each need, solutions can be found;

     

  2. In our experience, many if not most employment agreements do not contain “force majeure” or “Acts of God” clauses that specifically state what happens when circumstances arise beyond either party’s control. Therefore, without guidance in a contract, employees and employers need to decide how they will navigate these situations and we recommend win-win approaches that can be mutually-beneficial. We have focused on this type of collaborative approach in this blog;

     

  3. Generally, if an employer is unable to continue its operations for a short timeframe, it can temporarily lay off employees for up to 13 weeks under the BC Employment Standards Act. However, as we frequently advised in terms of the COVID-19 pandemic, unless an employment contract specifically allows for layoffs, the law views them as creating a constructive dismissal unless the employee agrees.  Fortunately, many employees and employers came to agree on terms for temporary layoffs as a way of helping businesses weather difficult periods during the pandemic (which ultimately provided employees with continued employment to return to). Similarly, if employees are willing to accept a temporary layoff during a state of emergency until the business can resume operations when the floods subside and supplies are restored, this can be a great solution. However, it is always best to have this layoff agreement in writing for the benefit of both parties;

     

  4. If an employee is unable to attend at the worksite, this is generally treated as unpaid time but, again, it is in most employers’ best interests to work with their employee to ensure that the work interruption is as short as possible and that medical and dental benefits remain in place;

     

  5. Consider whether remote arrangements, reduced shifts, etc. are possible depending on the nature of the business; and

     

  6. It is very important for business owners to think about their insurance coverages. Some businesses will have insurance that can cover business interruption due to unexpected circumstances. While the details of coverage are spelled out in the specific policy, it is important to assess what kinds of insurance coverage the business has in place and contact your brokers to discuss whether you have coverage in place to help during the emergency.

We hope that the situation is short-lived and offer these points as general guidance. However, we urge you to contact us to discuss your circumstances in further detail. We are here to help!