(COVID-19): Legal Aspects to be Considered by Companies
An overview of the events of the last few weeks shows the growing social and economic impact of the coronavirus (COVID-19) on a global scale, including in the business and companies’ fields. To this end, we consider appropriate to give some guidelines that companies should take into account in order to minimize the possible consequences of the health crisis of COVID-19. In this sense, it is recommended that, with the appropriate advice, the companies carry out an individualized study of their relationships with third parties, paying special attention to the following areas:
- Contracts signed with suppliers or customers.
The concept of force majeure may be the cause and justification for the frustration of a contract, which will imply its future non-fulfilment, thus causing damages that may be compensated in the event that such force majeure is not appreciated. The application of this concept must be evaluated in accordance with the legislation and circumstances applicable to each contract, as it is an undetermined legal concept. However, in order to assess force majeure, the company must, in any case, have exhausted all the means at its disposal to fulfil the obligations entered into.
- Insurance policies. Review of the scope of coverage contracted.
- Potential claims for liability of the Public Administration for actions or omissions related to this situation that cause damage that the company does not have a legal duty to bear.
- Review of the obligations that determine health regulations, mainly with regard to information duties and the adoption of preventive or precautionary measures agreed by the competent authorities.
- In the case of litigious conflicts, anticipate and avoid own acts that weaken the position of the company resulting from decisions in other areas of the company.
- To comply with the duty of diligence for the adoption of measures for due direction and control, which could lead to civil and even criminal liability.
- In the labour environment, companies should pay attention to inter alia to:
- The need to proceed to articulate measures for the suspension of employment contracts.
- The consideration as a situation of Temporary Incapacity derived from common illness of the absences of the employees as a consequence of obligatory quarantines imposed by the health authority.
- Review of the application of regulations on the safety and health of workers.
- Creation of protocols for remote work of its employees and the use of electronic and computer means made available.
- Special compliance with data protection regulations in relation to particularly sensitive information, such as employee’s medical and health data.
In addition, the directors and officers of the companies must review their action protocols, good governance practices and compliance processes to determine and confirm their correct monitoring and implementation, the need to adopt, where appropriate, new procedures and protocols and, in short, the adequate and correct fulfilment of due diligence obligations to avoid possible liability for action or omission.