The Tax Cheapo

Pinsent Masons, a legal firm in the UK, is advising companies to check the force majeure clause in their contracts as swine flu may obstruct them in performing their obligations and that clause might be able to act as their defence in case of any legal action.

Technology law expert with Pinsent Masons, David McIlwaine, stated that as more people fall ill, a much lesser number of employees would be available for work. The companies thus might not be able to fulfil their contractual obligations, which they had undertaken when this was not anticipated. To avoid paying damages for breach of contract, they can use the argument of force majeure.

However, as this is the first time that such arguments will be used, the firm and its lawyers are not completely sure of the response of the legal system if such cases are taken to court. Pinsent Masons believes that it is possible to defend this argument in court if the circumstances warranted a force majeure situation.

McIlwaine thinks that circumstances will influence the decision of the court but acts of the government like declaring an emergency, warning people against going to work and calling the swine flu situation a pandemic will have a great impact on the reaction of the Court.

Before the matter reaches the court, the parties can negotiate the matter and the companies need to make their positions clear as soon as possible. The Certificate in Employment Relations, Law and Practice (CERLAP) is designed to help those who are involved in HR/personnel activities to implement effective HR policies around employment relations and get-to-grips with the key issues that impact on employment practice.