COVID-19: implications for employers

23 March 2020

DisclaimerThe COVID-19 situation is constantly developing, and so are its legalimplications. This presentation is based on information that is currently availableand the prevailing legislation. Our team endeavours to update this presentationas and when there are relevant developments in the legislative frameworkrelating to the COVID-19 situation in Mauritius. For the most updated version ofthis presentation, please check our website – www.5fifteenbarristers.com.

In this presentation, we do not provide any legal advice or opinion, which wouldrequire factual or legal inquiry or analysis. Should you require any such advice oropinion, please contact a member of our team.

Bilshan Nursimulubilshan@5fifteenbarristers.comMob: (+230) 5472 6897

Kunal Ramnahkunal@5fifteenbarristers.comMob: (+230) 5709 5141

Part 1: Impact of the Confinement/Curfew

What happens during confinement/curfew?

COVID 19Work Access Permit

Stay Home

UNLESS

Necessity(medical treatment, essential supplies,

foodstuff, medicine or other item essential for subsistence of livelihood)

(1)

(2)

• Strictly essential minimum services – economic activities: supply of food (including bakeries, take away and home deliveries), food production,

farming (fruits, vegetables & livestock), food processing and beverages, supermarkets and associated supply chains (including online purchase and homedelivery), freight forwarding and other logistic activities, licensed telecom operators, petrol stations and cooking gas distribution, banks, insurance andother financial services, tourism, airlines, port and airport related services, press, media and associated services, transport including taxis, security guardsand watchmen (+some judicial officers and public servants)

• Rules/conditions:• Restrict number of employees to strict minimum (skeleton staff)• Residence to place of work and back only• Strict sanitary compliance required

• Application: click here for instructions

Continuing health & safety obligationswhen requiring employees to attend work on a Work Access Permit

OHSA, s.5(1): Every employer shall, so far as is reasonably practicable, ensure the safety, health and welfare at work of all his employees.

“‘Reasonably practicable’ is a narrower term than ‘physically possible’ and seems to me to imply that a computation must be made by the owner, in which the quantum of risk is placed on one scale and the sacrifice involved in the measures necessary for averting the risk (whether in money, time or trouble) is placed in the other – the risk being insignificant in relation to the sacrifice – the defendants discharge the onus on them.”

(Edwards v National Coal Board (1949) 1 KB 704, followed by the Industrial Court of Mauritius in OSHI v Fuel Sugar Milling Company Ltd [2007 IND 36])

“No system is totally safe hence the provision and defence available to an employer that it could only take measures up to a certain point which reduced the risk to a minimum.”

(OSHI v Fuel Sugar Milling Company Ltd [2007 IND 36])

PRACTICAL CONSIDERATIONS

• Provide transport to employees to avoid public transport?• Dispense employees with weaker immune system or increased risk from the virus (e.g.

asthma, diabetes, heart disease, pregnant, aged 70 or over) from attending work?

Curfew Order, para 5: Nothing in a permit issued by the Commissioner of Police shall exempt any employer from his statutory obligations pertaining to safety and health of his employees under any enactment which may be applicable.

Employees who stay at home (1/2)

If remote working is possible (whether fully or partially), consider:

➢ Agreement to be made in writing➢ Employee’s consent is required (Workers’ Rights (Atypical Work)

Regulations 2019, reg.3(2) and (4))➢ Set clear expectations and arrangements, including on reporting

and appraisal system➢ Pay allowance for use of home, electricity, phone, internet, etc.? Or

set off such allowance against shorter hours of work?➢ Ensure that the employment contract is varied only temporarily

➢ Adequate IT equipment and software?➢ Provide training/systems to ensure data security and privacy?➢ Support employees generally to adjust to new work routine

Employees who stay at home (2/2)

If remote working is not possible, the entitlement of employees to remuneration is, so far, not specifically provided for in legislation. In our view, subject to any future legislation:

➢ there is arguably no obligation for the employer to pay remuneration for the period of confinement1, but an employer who pays its employees may be eligible to financial support from the COVID 19 Wage Support Scheme (next slide)

➢ alternatively, employers may impose on certain employees to take up to half of their paid annual leaves during that time (to avoid absences post-confinement) pursuant to s.45(6) of WRA

Further, employers are encouraged to be sensitive to the financial impact of this situation on their employees. For example, where economically feasible, employers may consider paying a gratuity (as opposed to salary in respect of which social contributions

are payable) for the confinement period.

1. Whilst s.32(1)(a)(i) of the WRA provides that a full day’s remuneration is payable where the employer is “unable to provide work to the worker”, our view is that the confinement does not result in an employer’s inability to provide work, but rather in the impossibility of the work being performed for a short period, which impossibility “suspends” the contract for that period.

COVID 19 Wage Support Scheme (1/2)

Cabinet Decisions – 20 March 2020

“Cabinet has agreed to the implementation of a COVID-19 Wage Support Scheme to provide financial support to employees who would become technically unemployed on a temporary basis due to the impact of COVID-19. The Scheme would cover the Travel and Tourism Sector, as well as the Export Oriented Enterprises, the ICT/BPO Sector and SMEs affected by COVID-19.

Furthermore, in view of the confinement period of two weeks, the COVID-19 Wage Support Scheme would be extended to cover workers in other formal sectors of the economy for the two weeks’ restriction period.”

What is technical unemployment on a temporary basis?

➢ No definition or use of this term in current legislation

➢ Likely to be a direct translation of “chômagetechnique/partiel”, which under French law, involves working shorter hours at a reduced remuneration – this concept is broadly provided for under s.32(2) of the WRA and requires the approval of the supervising officer of the Ministry of Labour

➢ Seems also similar to the UK Coronavirus Job Retention Scheme, which will pay employees’ salaries of up to £2,500 a month as long as they are kept on the payroll

➢ We need to await further announcements and the required legislation in order to fully appreciate the framework and scope of the announced Wage Support Scheme

1

2

COVID 19 Wage Support Scheme (2/2)

Cabinet Decisions – 20 March 2020

“Cabinet has agreed to the implementation of a COVID-19 Wage Support Scheme to provide financial support to employees who would become technically unemployed on a temporary basis due to the impact of COVID-19. The Scheme would cover the Travel and Tourism Sector, as well as the Export Oriented Enterprises, the ICT/BPO Sector and SMEs affected by COVID-19.

Furthermore, in view of the confinement period of two weeks, the COVID-19 Wage Support Scheme would be extended to cover workers in other formal sectors of the economy for the two weeks’ restriction period.”

Salaries in respect of confinement periodBased on the press conference held by the COVID 19 National Communication Committee on 23 March and the communiqué issued by the MRA on the same date,

➢ in respect of employees who earn up to MUR 50,000 in basic monthly salary, the Government will fund 15 days’ basic salary for March 2020 up to a maximum of MUR 12,500;

➢ an employer must make an application to the MRA; and

➢ the MRA will credit the employer’s account with the relevant amount.

Note that as at the date of this presentation, no legislation hasbeen passed to give effect to the above scheme. We expectrequired legislation to be made shortly.

1

2

Other Government announcements

Cabinet Decisions – 13 March 2020

Amendments to be made to provide for:(i) time off to be granted to workers of that industry in lieu of

payment of overtime during the period of the outbreak; and(ii) a worker to resume work, with his consent, before a lapse of

eleven hours after having completed a normal day’s work.

Amendment to be made to provide that a worker may consent to work up to 12 hours a day instead of 8 hours.

Catering and Tourism Industries (Remuneration)

Regulations 2019

Private Hospitals and Other Related Health Services

(Remuneration) Regulations 2019

New Regulation to be madeTo provide for payment of wages to workers, who are placed in quarantine, to be offset against their leave entitlement.

Part 2: Surviving the longer-term impact of COVID 19

Alternatives to redundancy (1/2)Consider other commercial and financial solutions

Renegotiating commercial contracts

and financial obligations

Government support (“Plan de Soutien”)

Check our website for a separate upcoming briefing on these topics.

Alternatives to redundancy (2/2)

Shorter hours (part-time) at

reduced remuneration

Leave without pay

Offset time off against annual

leaves

Temporary reallocation of roles / training

Secondment or employee-on-

loan arrangement

We are working closely with our clients and network, in collaboration with Adecco Mauritius, to explore whether certain employers would “loan” their employees (with the latter’s consent) to other employers on a temporary basis, as an alternative to terminating their contracts for economic reasons. The benefits of such loan include:

• the increased likelihood of employee retention;

• financial solution for both employer and employee; and

• avoid disputes relating to redundancy/termination.

Contact us for more info.

Discuss possible temporary solutions with employees

If redundancy is contemplated…

Valid economic grounds?

• Not inherent to the employee but in the best interests of the enterprise (Nestlé Products (Mts) Ltd v

Dabysingh [1988 MR 179])

• Termination or modification is made to preserve the competitiveness of the business or forestall huge anticipated business difficulties (Saraspaty v Bedino Ltd (In Receivership) [2016 IND 2])

• Employer has proposed alternative employment to the employee with improved revised terms and conditions, but the employee has refused (Sraraspaty (supra))

If undertaking has 15 or more employees, or annual turnover of at least MUR 25

million, statutory procedure applies (WRA, s.72)

Consultation with trade union or employees’ representatives to explore possibility of avoiding redundancy or

compensation

If negotiations fail, give 30 days’ notice to Redundancy Board and do not terminate

before expiry of that notice period

Resources

For a list of relevant legislation and communiqués, please check our website.