Coronavirus: The Challenge Facing Global Legal Operations
The coronavirus pandemic has become a global story with rapidly changing realities. With 28 countries and territories reporting more than 31,000 cases – more than three-quarters of which originated in the Hubei province in China – corporations are facing stark challenges with the wellness of their employees and the operations of their enterprises.
Already, many of the world’s largest employers and airlines have suspended business, closed offices/locations or made dramatic changes to how their employees in China commute and work on a daily basis. It is yet to be seen how successful China’s efforts to contain and educate will be.
For companies with operations in China and other virus-stricken countries, the legal department becomes a key player in how to comply with local laws, develop enterprise-wide safety measures, and continue business under trying circumstances. There are several measures that we are seeing from these organizations and legal departments that provide an initial roadmap to handling this crisis as transparently and effectively as possible:
Workers in China: Best Practices for Legal
While there are many restrictions and quarantine measures already in place on travel to and from mainland China, companies are asking their employees to work from home as a best option. Of course, this presents challenges with China’s Great Firewall and the lack of consistent data access and internet-based functions. For those employees who are traveling into an office, they should avoid public transit and take taxis – some companies are paying for this service.
Even if an employee doesn’t work, there are laws requiring companies to pay employees who stay home because of the employer’s pause in production/work, as well as against terminating an employee who can’t work because of the virus (or is suspected of having the virus). There are other laws and rulings in neighboring regions of China, several of which are laid out here. It is vital for legal departments to monitor and understand these laws.
Employees Who Have Traveled to China
As workers have left China in droves over the last month, employers have created programs that address the potential spread of the virus. This includes requiring a 14-day quarantine period before returning to the office – roughly the expected incubation period – and providing more opportunities for employees to work from home. Even working remotely in a coffeeshop or shared workspace can defeat careful measures companies are implementing to avoid collections of people, so working from home is the best policy.
And while no other country outside of China has more than 20 reported coronavirus cases at the moment, if this underestimated virus continues to spread, many of the same initiatives will be needed in places like the US, Japan, Europe, and elsewhere in Asia:
- - Dramatic reduction in the use of public transit
- - Frequent/required washing of hands
- - Fever checks upon arrival at the office
- - Avoiding public places such as malls, theaters, squares, and gathering spots
With all forms of travel either on hold or severely limited, it also means that travel to mainland China will be impossible (or extremely challenging) in the coming weeks and months. At some point these restrictions will be lifted, but corporations will still need to monitor international health organizations, their employees on the ground and other local communications to determine what is best for their employees, clients and business.
Business Continuity During Coronavirus Outbreak
Besides the very real challenges to companies with employees on the ground or traveling to China, thousands of businesses rely on products manufactured in the country. There are no simple answers when addressing all of the questions surrounding this issue.
It could take several months for production to resume to normal. There could be trust issues from clients purchasing the productions, whether real or due to misinformation. The government could restrict production for much longer than anticipated. How is the supply chain impacted for everything from supply to delivery? Any of these issues can make a dent on a company’s bottom line.
Having a good grasp on the provisions within the corporation’s contracts with its Chinese (and downstream) partners is an essential first step. A lack of knowledge about the corporation’s options – many of these situations could take years to resolve – will only put more burden on the legal team as this crisis is (hopefully) resolved soon.