Page 68 - Retail World Tob - May 2020

LEGAL CORONAVIRUS: 10 LEGAL ISSUES FOR RETAILERS The major matters affecting retailers in terms of legal obligations during the pandemic’s disruption. ABy Gladwin Legal partner Rosalyn Gladwin. s COVID-19 causes unprecedented disruption to businesses and life as we know it, it’s unsurprising it continues to be at the forefront of discussions on both a personal and business level. This is unparalleled in our lifetime and it’s important for retailers to understand their legal obligations. 1. Working from home It’s likely that retailers already have a working-from-home policy in place. If they don’t, it’s imperative that they implement one. The policy should outline expectations with regard to how work should be completed, and how employees must guarantee their home is a safe workspace compliant with Occupational Health and Safety laws. 2. Privacy laws While employees are working from home, your business must continue to comply with privacy laws that regulate the storage of personal information. Privacy risks can be mitigated by providing company laptops and equipment that has pre-installed malware and privacy protection systems. 3. Leave entitlements Employees who have contracted coronavirus will be required to self-isolate and will be eligible for sick leave entitlements as outlined in the Fair Work Act 2009. In contrast, if an employee is not unwell but required to self-isolate because of a federal Health Department guideline or governmental direction, the period of time away from work would not be covered by sick leave. Instead, employers and employees should discuss whether working from home is a possibility, or agree on annual leave. If a part-time or full-time employee is required to remain at home by the employer’s direction, their base rate of pay should be paid. Self-directed isolation will be subject to ordinary leave protocols. 4. Stand-down versus redundancy It’s likely that working from home 66 RETAIL WORLD MAY, 2020 may not be possible for some types of employees and some industries. In the event that an employee’s job is no longer required, and the employee is made redundant, appropriate redundancy payments must be made. In the most extreme of circumstances, if an employer must stand-down employees due to a coronavirus outbreak and the employees cannot perform their employment obligations, the stand- down provisions are available in the Fair Work Act 2009. During this stand-down, employees are not entitled to payment. 5. Discrimination laws Employers should exercise caution not to make assumptions based on an employee’s characteristics that are protected under anti-discrimination legislation. This should be considered when creating preventative-measure policies, prohibiting employees from coming to work, or asking questions about an employee’s travel and contact. 6. Workers compensation If an employee can demonstrate that they have contracted coronavirus while at work, they may be eligible for a claim of compensation. The requirements are different for each state and territory. 7. Force majeure or frustration Force majeure applies where retailers can be relieved from liability for non- performance if circumstances beyond the parties’ control prevent fulfilment of contractual obligations. Please note that many retail leases expressly exempt ‘payment of rent’ from the force majeure clause. In the absence of a force majeure clause, in some circumstances, employers may be able to demonstrate that the coronavirus was an unforeseeable event that made it impossible to fulfil contractual obligations, or transforms the obligations into something fundamentally different, thereby making the contract frustrated. 8. Lease agreements Retail leases may expressly provide that a tenant is required to pay rent irrespective of whether the landlord is unable to fulfil their obligations due to the coronavirus. Therefore, if the landlord is legally compelled to close down the building, it’s unlikely that any rent abatement clause in the lease will cover such a situation. 9. Obligation to trade Ordinarily, tenants won’t be permitted simply to close up shop due to the COVID-19 spread without breaching its obligations in the lease. A landlord of retail premises in a shopping centre may assert that the reduction in traffic due to government restrictions and lockdowns is a risk that the tenant bears under the lease. 10. Managing supply chains Retailers should consider: • Proactively speaking with suppliers and discussing their ability to meet delivery commitments. • Checking the supply contracts regarding termination, exclusivity and force majeure. • Assessing alternative sources of supply and renegotiating customer contracts to meet extended delivery times. About Rosalyn Gladwin Rosalyn is the principal of Gladwin Legal, being an expert in all facets of retail law, including commercial and corporate law and retail leasing. About Gladwin Legal Gladwin Legal is the law firm for retailers. As experts in retail law, the firm understands the legal matters that challenge retailers daily. Its areas of expertise include retail and commercial leasing, supply and distribution agreements, intellectual property, ecommerce and IT agreements, sale of business and competitions and trade promotions. Get in touch at www.gladwinlegal.com.au.