Law firms help navigate uncharted waters

Lawyers field major uptick in privacy and employment law queries

"If your force majeure clause actually says ‘pandemic,’ you’re in luck" -- Jack Yong, Lawson Lundell. | Chung Chow

Independent power producers in B.C. may be lawyering up, following BC Hydro’s recent announcement it did not need – and would not pay for – some of the power they produce, due to the impact of the pandemic on electricity demand.

BC Hydro is invoking “force majeure” as a justification for breaking contractual agreements with independent power producers.

Business lawyers say they expect a lot of force majeure claims and negotiations, as a result of the pandemic. They also are getting a lot of inquiries about privacy and employment laws.

The COVID-19 pandemic has thrown governments and business into unchartered waters. Not surprisingly, business lawyers have been getting a lot of inquiries from employers needing advice.

Can they break a contract, even if the contract doesn’t have a force majeure clause? Can they fire an employee who refuses to come back to work, as the economy reopens? Can employers ask employees personal health questions without running afoul of labour and privacy laws?

Jack Yong, business lawyer with Lawson Lundell LLP, said his firm is getting a lot of queries about “force majeure” claims.

“Right now what we’re seeing is a lot of negotiations, transactions coming apart, parties trying to rely on the concept of force majeure to either walk away from contractual obligations, or to renegotiate them,” Yong said.

Otherwise known as acts of God, force majeure events include natural disasters and other unforeseen circumstances that may prevent companies from fulfilling contractual obligations. Many contracts have force majeure clauses. Some even specifically mention pandemics.

“If your force majeure clause actually says ‘pandemic,’ you’re in the luck,” Yong said. “You’re more likely to be able to rely on it.”

Not all contracts have force majeure clauses, however, in which case a business that can’t live up to contractual obligations, due to state of emergency restrictions, may still be able to rely on the legal concept of “frustration,” Yong said.

A sudden shift from working from the office to working at home has raised all kinds of privacy and confidentiality concerns for many businesses, says Suzanne Kennedy, who specializes in privacy law for Harris & Co.

And bringing those workers back, as the economy restarts, raises all kinds of legal questions over health and safety obligations.

When a state of emergency was declared in mid-March, thousands of employees were suddenly working from home, and some employers may not have thoroughly thought through the legal minefields that may have planted with respect to things like confidentiality, privacy and protection of proprietary information.

“If you’re a commercial enterprise and you deal in a lot of confidential commercial information, well, suddenly all that proprietary information is populating people’s kitchen tables,” Kennedy said. “What we were protecting in locked offices and behind closed doors and cabinets is now migrating home.

“So part of the privacy issue became about, ‘How do you continue to keep data secure?’ There are all kinds of electronic issues that come with that. Are you having sensitive telephone conversations in earshot of other people from home? There is all this new territory for data breaches.”

A lot of business meetings suddenly went online, with Zoom and other conference calling platforms, which could be vulnerable to hacking or even someone – a spouse or nanny – listening in who shouldn’t be.

Kennedy advises clients to read the fine print carefully for the various technologies they may be using, like video conferencing or WhatsApp-type messaging services.

“A lot of service providers limit their liability for data breaches to a very significant extent,” she said. “And in the rush to get everybody working, I’m not sure how many of us or our clients looked very closely at those.”

The pandemic has also created a lot of uncertainty with respect to rights and obligations of employers and employees. As businesses and offices reopen, many employers have questions about how to balance their obligations to ensure a safe workplace while not encroaching on employee privacy. Can they require all employees to have their temperatures taken every morning before they start work?

Can they ask questions about the employee’s personal health, or the health of their family members?

And what if an employee, who may have no underlying health concerns, refuses to come back to work, simply because he or she feels uncomfortable, or who needs to stay home because of children who are not yet back in school?

Even though some human rights and labour laws may not have adapted yet to an evolving landscape, expectations have.

“Six months ago, if somebody phoned up their employer and said, ‘Can’t come to work because I can’t find a babysitter,’ they’re not going to have a human rights obligation as an employer to accommodate that,” said Nicole Byres, a partner at Miller Thomson LLP specializing in labour and employment law.

“Today, when you can’t get people necessarily to do the child care, and your schools are shut down, it’s a real issue,” Byres said. “So employers are going to have to be flexible.”

While employers are obliged to provide a safe work environment, just because an employee doesn’t feel safe, that doesn’t mean he or she can’t be fired for refusing to come back to work, provided the employer at least tried to address the employee’s concerns.

“If an employee still refuses to return to work, we’ve certainly been advising employers: do not be quick to the trigger to fire people for being AWOL, because there may be some legitimate concerns, or maybe they’ve got things that they just haven’t told you yet – for example, the spouse that’s at home is immunocompromised and they’re petrified.

“We think that the refusals to work, the fear of coming in to work, will be a fairly significant issue that most employers will be dealing with going forward as they try to restart.”

nbennett@biv.com

@nbennett_biv