Legal and Workplace Implications of Reported Cases of the Novel Coronavirus disease: COVID-19

Having experienced Severe Acute Respiratory Syndrome (SARS) in the years of 2002 and 2003 which resulted in 1755 cases and 299 deaths, the public health situation in Hong Kong is once again under threat by the novel coronavirus outbreak, COVID 19. There have already been more than a dozen reported cases of the novel coronavirus infection locally.

Given such developments, this article seeks to highlight some of the issues and consequences that employers and employees may face in the context of the current legal framework.

Paid Sick Leave

Under the Employment Ordinance (“EO”) an employee is entitled to be absent and to be paid sickness allowance (at the rate of 4/5 salary) during a period of sickness providing that the following is satisfied:

• The sick leave is supported by an appropriate medical certificate;
• The sick leave is not less than 4 consecutive days if the employee is to be paid sickness allowance; and
• The employee has accumulated the number of paid sick days taken for which sickness allowance is due.

An employee accumulates an entitlement to sickness allowance days as follows:-

• In the first year of employment, an employee accrues 2 paid sickness allowance days for every month of employment.
• After that, the entitlement increases to accrue at 4 paid sickness allowance days for each month up to a maximum entitlement of 120 paid sickness allowance days.

Protection from Termination

If an employer terminates an employee’s employment during a day on which the employee is:

• absent from work through sickness and
• is entitled to be paid sickness allowance,

he commits a criminal offence under the EO punishable by a fine of “level 6” (currently $100,000). The employer is also liable under the EO for the sickness allowance the employee would have earned for the full period, pay in lieu of the notice period and an additional 7 days wages.

Protection from Discrimination

Where it is confirmed that an employee has contracted the novel coronavirus, the employer must ensure so far as reasonably practical that other workers are not exposed to the risk of contracting the disease (see below). 

On 7 January 2020, the “Severe Respiratory Disease associated with a Novel Infectious Agent” was declared by the Hong Kong government as a statutorily notifiable infectious disease under the Prevention and Control of Disease Ordinance.

Accordingly, the following would not be considered discriminatory where action was taken and where such action was reasonably necessary to protect public health:

• Complying with quarantine measures;
• Taking precautions against the spread of disease.

In addition, under the Disability Discrimination Ordinance and Family Status Discrimination Ordinance, it is lawful for an employer to ask an employee with infected family and relatives to stay at home and take paid leave.

However, it is likely to be discriminatory if an employer dismisses an employee merely because the employee had or is suspected of having a disease or an employee’s family member has or may have a disease.

Protection of Personal Data

If employers are to implement any policies or measures in tackling the situation of the novel coronavirus (see below), the employees may have to provide or disclose certain sensitive information (such as medical history, travel records or details relating to their family/ relatives). Employers should take care to ensure that any personal data collected as a result is processed in compliance with the requirements under the Personal Data (Privacy) Ordinance.  

Possible Claims for Compensation under the Employees’ Compensation Ordinance “ECO”

Employers should be reminded that employees can claim compensation for work-related diseases under the ECO. This provides that an employee will have the right to recover compensation in respect of the contraction of disease if that amounts to a personal injury by accident arising out of and in the course of employment.

In handling such claims, the Labour Department guidelines state that they will assess whether the employee concerned has accidentally contracted the disease out of and in the course of employment. This assessment is made by reference to medical records, relevant information of the case and the provisions of the ECO. It seems unlikely that the severe respiratory disease associated with the novel coronavirus would fall within this category of claims, but it is a possibility where workers are involved in treating sufferers, in high-risk industries or are required to work with known sufferers.

The Employer’s Safety Obligations

As noted, the EO provides entitlement to paid sick leave. However, the EO does not deal with many other issues that would arise in the event of a sudden outbreak of the novel coronavirus. The general position under the Occupational Safety and Health Ordinance (“OSHO”) is that employers must take reasonable steps to ensure that a safe place of work is provided to all employees. Examples of the employer’s duty are:

• To provide information, instruction, training and supervision as may be necessary to ensure the safety and health of employees at work;
• To maintain the workplace in a condition that is safe and without risks to health where the workplace is under the employer’s control; and
• To provide or maintain a working environment for employees that is safe and without risks to health.

In addition to statutory duties under OSHO, employers owe a duty of care at common law to take reasonable steps to ensure safety in the workplace.

Practical Steps

What then are employers required to do?

Employers have a common law and statutory duty to provide a safe place of work. Therefore, where there is a risk that employees will be exposed to an infectious disease, employers must take reasonable steps to prevent this from happening. In order to do this, employers should develop policies and procedures in order to discharge their duty of care to employees. The contents of such policies and procedures are, to a large extent, governed by the nature of the employer’s business operations. 

There are some common measures that employers should consider implementing to discharge their duty to employees. These include the following:

• Keeping employees fully up to date with the current situation of the virus, any major developments, prevention information and the contingency plans which are being put in place at any particular stage. The World Health Organisation website contains useful information and technical guidance with a section specifically addressing the novel coronavirus. (See www.who.int/en.)
• Identify personnel who may have had contact with people affected by the virus, for example, those who may have relatives in high-risk areas such as affected regions of mainland China or other parts of the world where there have already been outbreaks of virus or those working in higher-risk industries such as medical services sectors, or those living with healthcare workers.
• Require staff to report to the employer any symptoms associated with contracting of the disease.
• Require staff to report to the employer any travel to and from high-risk areas.
• Prepare contingency plans to have employees operate from an alternative location or, for example, from home if the employee’s work can be carried out remotely on a computer linked to the office computer server.
• Reduce the amount of business travel where possible, to limit the exposure risk to employees, particularly those required to travel to areas which are known to be infected.
• Reduce the risk of infection in the office by regularly clean and sanitise frequently touched surfaces of the office, asking employees to subject to temperature check and providing face masks and other sanitising products for use by the employees.
• Implement special dispensation for employees to work from home, particularly for those who suffer from long-term illness or conditions.
• Issue guidelines and reminders to employees for maintaining good personal hygiene.
• Should an employer suspect or know that an employee may be infected then the employer should promptly request that the employee remains at home. In the case of suspected infection, the employee should be requested to stay at home until the employee can confirm that he/she is not infected.
• Consider the possibility of changing hours of work in order to stagger start and finish times, to allow employees to travel on public transport at less crowded times.
• Consider issuing guidance to employees as to the arrangement of physical meetings with clients (especially large meetings) if alternatives to or postponement of such meetings are not feasible, in which case further preventive measures may be taken (such as ensuring the cleanliness and ventilation of the meeting venue).

Generally, employees are required to comply with all of their employer’s reasonable directions as to the performance of their duties. As there is an implied obligation on the employer to take reasonable steps to protect employees’ health and safety, there is a corresponding obligation on employees to comply with directions which are for that purpose.

If a risk of novel coronavirus being transmitted from person to person arises within the workplace, and the steps being taken by the employer to reduce this are reasonable and proportionate, the employees are obliged to comply with the employer’s directions. This may include implementing measures which the employer reasonably requires to protect the health and safety of all employees. Examples of steps (depending upon the level of risk and seriousness of the situation) include the steps mentioned above and also measures such as:-

• Directing employees to work from home either generally or in split shifts to minimise risks of infection of the whole workforce;
• Requiring employees to disclose situations which may cause a higher risk (travel to affected areas, contact with any known sufferers of the disease);
• If the risks increase and medical advice recommend such a step, maybe even the compulsory wearing of face masks.

Special work arrangements during an outbreak

By the Employer

Employers can unilaterally reduce the work hours of the employees by allowing them to attend the office at a later time or leaving work at an earlier time. This may enable the employees to avoid the busy hours of public transports and thereby reducing their risk of infection.

On the other hand, the employer does not have a unilateral right to suspend employment, force employees to take unpaid leave or change the work hours to the effect that the employees have to attend earlier or stay later at the office to work unless there is an express provision in the contract permitting the employer to do so or express agreement. 

In particular, if the employer suspends the employee’s duties and their entitlement to payment of wages and other benefits, this would usually be a serious breach of contract entitling the employee to claim constructive dismissal. In that situation, the employer would be liable for all amounts due – as if the employer had expressly terminated the employment without notice. This includes pay in lieu of notice, any long service pay/severance pay/terminal benefits, accrued holiday pay and a pro-rata of any fixed annual bonus.

Other work arrangements including the change and relocation of the workplace of employees, in particular, if overseas, and requesting them to actively obtain and disclose medical clearance/sign-off may be legally problematic and will depend on the terms of the employment contract.

Employers should, therefore, act carefully in seeking to impose any proposed step that involves a reduction in benefits due to economic circumstances arising from an outbreak of the novel coronavirus and the temporary suspension/reduction in the employee’s duties. Employers should seek to agree on any such suspension or period of unpaid leave.

Employers should also pay attention to certain issues which different categories of employees may give rise to. Some of these examples are given below.

• For employees returning to work from high-risk areas which may be experiencing an outbreak of the novel coronavirus, the employer should ask them to notify the office in advance and not to attend the office. The employer should also consider providing reasonable accommodation to such employees (who may be working from home) during their quarantine from the office.
• If it is suspected that an employee is deliberately not attending work without approval or justifiable reasons, the employer should ensure that there is an existing express policy to deal with such issues and consider such when taking any disciplinary actions.
• Due to the measures put in place by the Hong Kong Government, if an employee is returning to Hong Kong from mainland China from 8 February 2020, he or she will be subject to quarantine or medical surveillance. In this regard, the Government appealed to the employers, who receive from an employee a certificate issued by the authority that he/ she is under quarantine or medical surveillance, to grant the equivalent of paid sick leave to that employee in accordance with the EO. 
• The employers should provide reasonable accommodation to employees who had contracted the virus but had recovered from the infection and returned to work regardless of whether they may be entitled to paid sick leave under the EO.
• Specific legal advice should be sought by the employers with regard to employees who are employed and paid on a piece work or hourly basis. Unilateral steps by the employers to restrict the workload of these employees, which may adversely affect their remuneration without express contractual rights to do so, may have legal ramifications.

By the Employee

Similarly, employees do not have a unilateral right to withdraw their services and insist on remaining at home. If employees refuse to perform their duties without sufficient grounds, then they will not be entitled to payment for those days of unauthorised absence and also run the risk of Summary Dismissal.

In some limited circumstances where there is a serious risk to the employee’s health and safety, an employee may legitimately decline to follow the employer’s directions. However, this is only if doing so would unduly increase the level of risk to the employee’s health and safety to an unacceptable level. However, in general, the employee would need to demonstrate a genuine and serious risk and not merely a perception or a slight increase. 

In the absence of serious and genuine risks, employees should perform their duties and seek to liaise with their employers to agree on reasonable arrangements for the minimisation of any perceived risks.

Other Issues – Insurance

It is likely that the novel coronavirus situation in Hong Kong may result in various insurance claims made by many businesses in Hong Kong, similar to the aftermath of SARS. An example of such claim made at that time was Mandarin Oriental International which agreed on a substantial settlement with its insurers for the interruption to its hotel business. Following these payouts, insurers are now more cautious in the scope of insurance coverage that they provide in respect to communicable diseases and business interruption.

Businesses should therefore carefully check their insurance policies to ensure that they are covered for situations where circumstances such as travel restrictions, quarantine measures, and cancellation of events may arise in the event of an outbreak of the novel coronavirus. Event organisers are particularly at risk when seeking to insure against the financial effects of the outbreak of disease. Employers and business people generally should also review their insurance coverage carefully and consider if this is adequate.

Conclusion

The suggestions above are not in any way an exhaustive or mandatory list of measures which should be taken by employers or employees to tackle the risks posed by the novel coronavirus. 

In formulating or implementing any such measures, employers should pay attention to the terms of the employment contract (which may vary between employees) and the regulation of the EO or other relevant legislation.

Any measures taken should also be adjusted accordingly as the situation of the novel coronavirus develops.

More importantly, all parties should maintain good communications with each other and be informed of any updates and advice issued by the Government or other health organisations. 

If there are any doubts or disputes arising from the measures taken in respect of the novel coronavirus situation, parties may consider seeking legal advice to help clarify or resolve the issues.

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Disclaimer: This publication is general in nature and is not intended to constitute legal advice. You should seek professional advice before taking any action in relation to the matters dealt with in this publication.