The current position on Covid-19 (Coronavirus) is constantly developing in the UK and worldwide.

Background

The current position on Covid-19 (Coronavirus) is constantly developing both in the UK and worldwide, with the lockdown of the entirety of Italy highlighting the scale of the issue. In this note, we focus on the key issues that businesses should be considering for the safety of their employees and what legal duties employers have in relation to the virus. We will also discuss the practical steps that can be taken to minimise risk to employees and other key stakeholders and to mitigate business disruption. 

Current position

As at 9am on 9 March 2020, the official Government figures showed a total of 24,960 UK tests have been undertaken, 24,641 were confirmed negative and 319 positive of COVID-19. Five people have now died. The NHS have advised that they are working closely with WHO and are using tried and tested infection control procedures to prevent further spread of the virus.

The Foreign & Commonwealth Office (FCO) are advising against all travel to Hubei Province in China and against 'all but essential' travel to mainland China and recommend that British Nationals who are able to leave China do so. The FCO is also advising against all but essential travel to:

• the cities of Daegu and Cheongdo in South Korea
• Italy

The FCO is not advising against travel to any other country/territory as a result of coronavirus risks but the advice remains under constant review to ensure it reflects current risk.

The World Health Organisation has declared Coronavirus a public health emergency of international concern. Currently the risk to the public in the UK remains at a 'moderate' level. Despite this, the government has announced that in accordance with regulation 3 of the Health Protection (Coronavirus) Regulations 2020, the threat from the transmission of coronavirus constitutes a 'serious and imminent threat to public health' so measures have been implemented to forcibly quarantine anyone with coronavirus, preventing them from leaving a facility and also giving them the power to forcibly send someone to isolation if they pose a threat to public health. This development comes after it was reported that a British patient at an isolation facility was threatening to leave. 

As the situation continues to worsen, yesterday Public Health England has said that widespread transmission of coronavirus in the UK is now "highly likely" and the country must be prepared. Meanwhile the EU has now raised the coronavirus risk in member states from "moderate to high".

Position on Travel 

The current travel advice from the Government is that travellers returning from the below areas to the UK are advised to immediately stay indoors and avoid contact with other people and call NHS 111 to inform them of their recent travel. Businesses should suspend all business travel to these areas unless it is essential. 

These areas are:

• Hubei province in China in the last 14 days, even if you do not have symptoms;
• Iran, Italy or special care zones in South Korea since 19 February, even if you do not have symptoms;
• other parts of mainland China or South Korea, Hong Kong, Japan, Macau, Malaysia, Singapore, Taiwan or Thailand in the last 14 days and have a cough, high temperature or shortness of breath (even if your symptoms are mild); and
• Cambodia, Laos, Myanmar or Vietnam since 19 February and have a cough, high temperature or shortness of breath (even if your symptoms are mild).  

Businesses will need to consider what to do in situations where employees cannot work. Where it is appropriate to work from home this will not be an issue, however there will be situations where the nature of the work involved means working from home is not appropriate. In these situations businesses will need to consider their approach, particularly in relation to pay. While it may seem cost effective to refuse to pay those who are unable to work due to Government guidance, consideration needs to be given to the negative effects of being seen to penalise those who self-isolate or follow Government guidance and to the wording of existing sickness/absence policies. There is also a risk that this approach may lead to employees failing to disclose travel to high risk countries in order to avoid being left unpaid, which may in turn put other employees at further risk.

Recent Government Action

The government published its coronavirus action plan on 3 March.

The overall phases of the plan to are:

• Contain: detect early cases, follow up close contacts, and prevent the disease taking hold in this country for as long as is reasonably possible
• Delay: slow the spread in this country, if it does take hold, lowering the peak impact and pushing it away from the winter season
• Research: better understand the virus and the actions that will lessen its effect on the UK population; innovate responses including diagnostics, drugs and vaccines; use the evidence to inform the development of the most effective models of care
• Mitigate: provide the best care possible for people who become ill, support hospitals to maintain essential services and ensure ongoing support for people ill in the community to minimise the overall impact of the disease on society, public services and on the economy

UK health officials are moving towards the second phase of their response to the coronavirus outbreak. On 5 March, the country's chief medical adviser Prof Chris Whitty said the next phase - "delay" - will see more action to slow the spread of the virus. That would allow for school closures, steps to encourage home-working and reduction of large-scale gatherings. He also said it was highly likely" there was now some "community transmission" within the UK. The Government said it would formally announce when it switches from the "contain" to "delay" stage and that this has not yet happened.  As at 9 March the government's COBRA committee declined to introduce the "social distancing" measures associated with the delay phase but accepted that the virus would continue to spread.

The Competitions and Markets Authority has warned retailers and traders they could be prosecuted for trying to "exploit" the virus outbreak by selling protective products at inflated prices. The CMA said it would consider asking the government to introduce price controls if required.

Legal Duties – Health and Safety

Employers have a legal duty under the Health and Safety at Work etc Act 1974 to ensure the health and safety of employees and customers, along with members of the public affected by their activities, so far as is reasonably practicable. This effectively means that businesses should not expose those individuals to a material risk, i.e. one that is more than minimal or trivial. This duty is likely to extend to ensuring that staff are not placed at undue risk from Coronavirus. Businesses therefore need to assess the risk and either eliminate it or minimise it to the lowest level possible. This is a balancing exercise to be taken by businesses with the risk on one scale and the sacrifice on the other scale in terms of time, trouble and money to eliminate or reduce the risk. Unless there is a gross disproportion between the two, then it is reasonably practicable to adopt the relevant control measures. 

In addition there are sectoral obligations, for example the FCA requires the financial services firms it regulates to have in place appropriate systems, resources and procedures to ensure that they can continue to perform their regulated activities, this extends to Coronavirus and the need to have contingency plans in place.  

In reality the management of a risk such as a virus is not straight forward, and will change and vary according to the circumstances both in the country at large and among your employee/customer population.  Decisions will need to be based on judgement and good practice. In these circumstances, Government guidance should be the standard adopted for controlling the risks of Coronavirus, with additional measures informed by the views of suitably qualified advisors. Failure to comply with these legal duties may amount to a criminal offence.

Mitigation Steps

Given the significant impact that the virus has had in China and in other countries, it is important for employers to consider the risk and to prepare and put in place contingency measures. These measures include:

• A risk assessment should be carried out and documented in relation to general risks around Coronavirus and a specific risk assessment arising out of any specific cases to ensure that adequate control measures are put in place;
• Employers should monitor the risks posed to those likely to be at a higher risk. This includes anyone with pre-existing health conditions, those with weak immune systems and pregnant members of staff. Employers may need to take further steps to reduce the risk to these individuals.  
• Staff should be reminded of general hygiene rules, such as regular hand washing and use of antibacterial items, which the available advice suggests is the best way to avoid the transmission of the virus and dispensers should be installed, where possible;
• As the situation and therefore the advice is continually evolving, employers should consider how they communicate the advice with employees and how this is done in order to minimise the potential for any undue stress and anxiety to be felt. Businesses should consider selecting an individual or a team to consistently deliver the organisational response and to answer any questions employees may have to give employees a clear point of contact;
• Ensure effective communication with staff regarding Government advice and the approach the business is taking through prompt dissemination of clear information;
• Any advice should only reflect government advice, advice from other official sources such as the World Health Organisation or advice informed by those with the requisite expertise;
• Encourage staff to review the company sickness or working from home policies and reiterate to those who are feeling unwell, not to come into work; and
• Adopt a robust management plan to ensure business continuity in the event of a severe outbreak.

Business risk

Given the impact worldwide, there is clearly going to be business disruption.   In the week of 28 February concerns about the outbreak wiped more than $5tn from global stocks.  Similarly concerns on 9 March led to a £125bn reduction in the value of the UK's FTSE100 alone with trading on Wall Street briefly suspended due to the speed and magnitude of the Dow Jones' decline.  

In China a number of cities are on full or partial lockdown which has had an impact on some businesses who operate out of China. The same is now true of the entirety of Italy.  Businesses have already reported issues with product supply due to the restrictions put in place, including limits on the ability of workforces to attend work, closure of plants and offices, and limits on movement out of or into affected areas. Sourcing of material may also be another area to consider as the wider supply chain could also be affected - if it is necessary to source alternative providers then this could lead to increased costs. For example 4 major car chains have already announced a possible cessation of European production due to the loss of supply of electronics components manufactured in Lombardy.  It is equally possible that businesses may see an increase in orders as people in quarantine could be more active online. This disruption of supply with little, if any, associated reduction in demand, has the potential to be very damaging to supply chains.

It is unclear what effect the virus will have on food supply, whilst experts have indicated that the virus does not appear to be spread by way of contaminated food they have warned of "smear" infections (i.e. contaminated packaging from contact with infected persons) but these are only likely to occur over short periods of time between the "smear" and contact with another person.  It is however unclear what effect measures such as quarantines etc… will have on the supply and distribution of food as the scale of the government's response grows.

Recent examples serve to illustrate the affect an outbreak can have on your business.  In both cases major financial institutions identified a case of Coronavirus among their workforce.  Public Health England importantly did not require that the entire office closed (although businesses can of course take a more conservative approach to risk management if they choose to).  In each case a floor of their office was closed and the floor and common areas were deep cleaned.  Staff were also permitted to work from home to minimise the risk of infection.

We have highlighted some key practical steps that can be taken to mitigate the businesses impact:

• Identify contracts relating to transactions that are likely to be affected by the current outbreak to understand your rights and obligations as well as the applicable laws and dispute resolution mechanisms;
• As soon as a default occurs, consider acting promptly to address any breach, including, where applicable, providing relevant notices of a dispute and commencing enforcement action where appropriate;
• Where events are planned to take place continue to assess the risks in light of the developing situation and seek advice on your contractual position (for example Force Majeure clauses) in the event that cancellation becomes necessary;
• Review insurance policies to understand the scope of coverage and relevant notification periods;
• Review information security policies and systems to ensure they are suitable for work from home arrangements;
• Monitor directives and guidelines issued by governments and regulatory bodies on how to respond to the outbreak;
• Monitor special arrangements of governments, regulatory bodies and the courts as limited service hours may impact the ability to meet deadlines, obtain regulatory consents and approvals and to satisfy milestone dates; and 
• Monitor travel advisory alerts and quarantine rules which may impact business travel. For contacts of a suspected case in the workplace, no restrictions or special control measures are required while laboratory tests for COVID-19 are awaited. There is no need to close the workplace or send staff home at this point. If a confirmed case is identified in your workplace, the PHE local Health Protection Team will provide the relevant staff with advice.

In addition there are workforce management steps which can be taken to ensure business continuity whilst mitigating health risks, including:- creating alternating shift based teams to minimise the risk of cross infection

• Review employment terms (including work from home policies) of employees in affected countries and consider revisions to employment policies where applicable;
• Encourage work from home and flexible working
• Encourage employees to shift their commute outside of rush hour to minimise transmission risk
• Allow annual leave to be taken at short notice where this will not cause excessive disruption
• Put in place remote working systems where these have not yet been adopted 
• Update sickness absence policies to cover situations such as self-isolation
• Consider how to deal with employees travelling to and from high risk areas

Conclusion

A company's response to Coronavirus will be key in how employees will feel and react to the issue. The approach to risk management in response to what is a developing situation must be dynamic, with regular review of control measures in light of changes in the risk of transmission.  It is therefore essential that businesses put in place clear and effective means of communication with staff and evidence that the business is considering staff welfare and responding in a way that puts employee safety at the forefront of the decision making. 

If your business requires assistance in responding to and preparing the Health Protection (Coronavirus) Regulations 2020 to Coronavirus Addleshaw Goddard LLP are able to advise on how to respond and prepare a business response plan in relation to Coronavirus. 

Our health and safety team is part of our Global Investigation team.  The team is led by Erin Shoesmith and benefits from the expertise of a number of Legal Directors including Alan Fox, Adrian Mansbridge and Tony McGlennan, together with support from solicitors, trainees and paralegals. The team also benefits from the insight of our AG Integrate Consultants, including former Principal inspectors at the Health & Safety Executive, who bring a wealth of technical knowledge along with operational and enforcement experience.

If you would like to discuss any of the issues raised in this article please contact Erin Shoesmith on 0161 934 6554 or at Erin.Shoesmith@addleshawgoddard.com.