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Mitigating the results of Covid-19 on work contracts


It appears in these uncertain moments of COVID-19, that most folks are worried about the result of COVID-19 on their employment contracts and how to mitigate any hardships that may possibly arise from this pandemic.

In this paper, we will handle the next troubles:

  1. the outcome of COVID-19 on employment contracts and
  2. mitigating its outcomes on work contracts.

The Impact of COVID-19 on Work Contracts.

All around the environment, the economic effects of the COVID-19 pandemic is becoming felt by governments, private companies and citizens alike. In Ghana, the Govt has experienced to impose limitations on the motion of persons in get to gradual down the spread of the COVID-19 virus by way of the Imposition of Limitations Act, 2020, Act 1012 (Act 1012).

This has led to the closing down of some firms and has made it unattainable for parties to fulfill their obligations below employment contracts. This problem provides rise to two authorized concepts which corporations might have to be aware of to possibly suspend or terminate their contracts if they are to endure. These legal concepts are pressure majeure and disappointment.

Drive Majeure:

Power majeure is a clause that can be invoked to possibly suspend or terminate a agreement based on the wording of the pressure majeure clause. The wording of the force majeure clause may well either free of charge the two events from any legal responsibility or obligation or cap legal responsibility when an incredible occasion or circumstance outside of the management of the functions occurs.

To rely on drive majeure, it will have to be expressly stated in the deal. Gatherings these types of as war, strike, riot or an epidemic are usually involved in these clauses as pressure majeure functions. In the current circumstances, a celebration simply cannot presume that just because there is a force majeure clause buried somewhere in their agreement, that they can depend on it to mechanically suspend or terminate the deal.

In buy for a celebration to bring about this clause, the drive majeure situations captured in the clause should go over a pandemic like that of Covid-19 and/or governing administration limitations this kind of as those people imposed by Act 1012. The social gathering should also comply with any stipulated procedures that need to be adhered to, to set off the clause, if any are outlined in the deal.

In addition, a drive majeure clause ought to state what solutions would be out there to the celebration trying to get to rely on it. These cures can assortment from allowing for the delay in a bash fulfilling its obligations, to allowing for get-togethers to suspend or terminate the contract. The clause might also stipulate time limitations for any delays in fulfilling obligations. 

Hence, if on a very careful review of your deal, you locate that the contract’s pressure majeure clause does not contemplate a pandemic or a govt-imposed restriction, or it does not present for the suspension or termination of the contract when these functions occur, then you can’t rely on the basic principle of power majeure to suspend or terminate your contract in these instances.


Frustration applies in which an function that was unforeseen by the events and did not come up as a outcome of a party’s breach of the agreement, would make efficiency of the contract not possible. A case in point is a contract for the staging of an celebration at a specified location, if the venue burns down prior to the function, it renders the agreement unachievable to complete.

One more classic instance is where there is a alter in legislation that makes it unlawful for just one or the two events to perform their obligations underneath the deal, this sort of a agreement can be deemed disappointed. If a agreement is disappointed, the get-togethers are fully produced from their contractual obligations. The agreement is not merely suspended.

Thus, we will clearly show you how to maintain your work deal throughout this crisis interval with these rules in thoughts.

Mitigating The Effects Of COVID-19 On Employment Contracts

The subsequent prompt solutions will empower parties manage the outcomes of the COVID-19 disaster. Our answers are:

Get-togethers could abrogate the existing employment contract and enter into a new deal for the period of the COVID-19 disaster or

  • Functions may amend employment contracts to contain a COVID-19 drive majeure clause.
  • Functions may abrogate the present work deal and enter into a new agreement for the duration of the COVID-19 disaster (the ‘Covid-19 contract’).

This alternative would demand that the get-togethers concur during the crisis period to abrogate the present contract since it has been discouraged, and to enter into a COVID-19 agreement which would stimulate the next:

  • doing work from property
  • fastened hrs
  • job description.

    Doing the job from household

This COVID-19 agreement really should state that for the duration of the disaster period the employee’s property will be the designated workplace spot. Confining the function place to a particular website in the dwelling will mitigate towards claims for damages or bodily harm that take place in other parts of the home.

Preset hours

The COVID-19 contract need to concur on frequent and fixed doing the job several hours, as very well as  rest breaks. If there  are no proven fixed hours, an employee could arguably claim that an harm happening at any time for the duration of the day is a workman’s payment claim.

Task description

The employee’s career description ought to be in-depth so that there is no discrepancy as to what activity is aspect of the employee’s occupation and what is not.

Immediately after the disaster period, some employees may go to courtroom to request payment for hazards encountered at property, and as these types of, reducing a lot of the danger that goes along with operating at residence in the Covid-19 contract could go a long way to mitigating the employer’s hazards in these unsure occasions.

  • Get-togethers might amend work contracts to include things like a Covid-19 power majeure clause.

This resolution is relevant to these who would want to count on the theory of force majeure to suspend the deal in the course of the crisis time period. We suggest that if upon a very careful evaluation of the deal, the contract does not ponder a pandemic or a govt imposed restriction and it does not anticipate a suspension of the deal, then the get-togethers may perhaps during this period amend the present contract to include an categorical force majeure clause.

This will guard the two functions in the function that soon after the disaster interval an personnel chooses to sue the employer for failing to pay out their total salaries all through the disaster interval and the employer also suing the staff for failing to accomplish his obligations in the work agreement during the disaster time period.

In summary, we have in this paper tackled issues this sort of as the result of COVID-19 on an employment contract and how to mitigate any hardships that may well come up from it .

Emmanuel is the Managing Lover and Head of the Real Estate, Development, Infrastructure and Transportation follow group of M&O Law Consult with. Make contact with him by using ematekole@molawconsult.com

Selma is Senior Authorized Counsel at the Ghana Grid Corporation Minimal with expertise in Work, Strength and Procurement Law. Speak to him by way of sawumbila@gmail.com

Go through more about the writers www.molawconsult.com

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