MANAGEMENT
By Stephen Safran
Contracts and HR Management in a Post COVID-19 World Tips for moving forward in a new normal
O
ne thing is for sure, the world has changed. Due to COVID-19, the construction industry’s new normal is still being sorted out. Attorneys are receiving questions from business owners about what their companies should be doing right now to respond to evolving stay-at-home government orders, as well as how to prepare for the future. As is true during more normal times, construction companies are focused on how they Stephen Safran is an attorney practicing law in North Carolina with a focus on construction and employment law. In addition to private practice, he has experience as corporate counsel for a large site work and utilities contractor, overseeing legal and human resources departments. His practice includes representing contractors and design professionals in construction litigation, business litigation, and labor and employment matters. Safran Law Offices, Raleigh, N.C., has delivered a series of weekly webinars and resources on COVID-19 and its effect on the Construction Industry. For more information, visit safranlaw.com.
can protect themselves when facing a project delay, the difference being the new challenge is due to COVID-19. In addition, less common in a good job market, employers now want to know how to handle employee absenteeism during the pandemic. Two key areas for contractors to focus on in the future—with or without COVID-19 are—force majeure clauses and employee management.
Force majeure clauses If you are unfamiliar with the concept of force majeure, it literally interprets to an “act of God.” It is an unforeseen event that occurs by no fault of the contracting parties. If COVID-19 has not already affected the way you do business, it is possible that you could experience supply chain disruptions and even labor shortages, at some point in the near future. If one of your projects experiences a delay due to COVID-19, a well-crafted force majeure provision could prevent delay related damages to your business. Generally, force majeure provisions consider: (1) whether the event was outside the reasonable control of a party, (2) whether
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the event was reasonably foreseeable, (3) whether it affects a party’s ability to perform, and (4) reasonable steps to avoid or mitigate the outcome. For contracts entered into preCOVID-19, it is uniformly considered that COVID-19 was outside the control of the contracting party and did not reference epidemic, pandemic or quarantine related delays. Even though we have been through serious disease outbreaks before, such as H1N1, almost everyone can agree that the COVID-10 pandemic and subsequent stay-at-home orders, was not reasonably foreseeable.
Giving notice If your contract was entered into before COVID-19 and your business is being impacted, it is recommended that you review your contract and look for prerequisites that must be done before you can be afforded force majeure protection. It is likely that you must give the other party written notice of any force majeure delays. Even if you are not currently experiencing delays, it is recommended that you give “pre-notice” in anticipation of future