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COVID-19 legal update banner Africa icon
Coronavirus (COVID-19) | legal update
issue 1 | 30 Mar 2020

a national state of disaster

Now what?

On 15 March 2020 the South African President declared a national state of disaster in terms of the Disaster Management Act, 2002. A national state of disaster lapses 3 months after it has been declared, but can be withdrawn or extended. A number of measures have since been implemented by the South African Government to counteract the impact of COVID-19, and several regulations, directives and guidelines have consequently been published. Pippa Reyburn (ENSafrica | Corporate Commercial) gives an overview. Government communications have set up a dedicated COVID-19 website and are posting all legislative resources here.


How is COVID-19 going to affect my business?

Have a look at our high-level guidance for businesses to mitigate/manage the disruptions that may be caused due to the COVID-19 outbreak and the impact of some of the new regulations, directives and guidelines.

Movement and remote working during lockdown
Everyone will be confined to their homes unless they are performing essential services, obtaining essential goods or services, collecting social grants or seeking emergency, life-saving or chronic medical attention. You may not attend any gathering (except a funeral attended by no more than 50 people and which may not include a night vigil), move between provinces or move between metropolitan and district areas. If you are performing a permitted activity you will need to do so within the parameters of the restrictions in the lockdown regulations. Altair Richards and Pippa Reyburn (ENSafrica | Corporate Commercial) provide the details here. Separately, Government has clarified that remote working arrangements are allowed. Johan Loubser (ENSafrica | Banking and Finance) explains.


New competition rules for fighting COVID-19

On 19 March 2020 the Minister of Trade and Industry published two sets of regulations under the Competition Act, 1998. The first contains a block exemption for conduct by healthcare companies during the national state of disaster that would ordinarily be caught by the cartel and vertical restrictive practices prohibitions of the Competition Act, 2008, provided that such conduct 1) is aimed solely at responding to the COVID-19 pandemic and 2) is at the request of, and in coordination with, the Department of Health. The second aims to protect consumers from unlawful pricing behaviour in respect of products and services that are critical to effectively responding to the pandemic. ENSafrica’s competition/anti-trust team highlights some of the key components of these new regulations here.

consumer protection

If your booking gets cancelled due to COVID-19, you might be able to get a refund

It will depend on the background facts to the cancellation and is largely regulated by the Consumer Protection Act, 2008, the Ts&Cs governing the booking and South African common law. Angela Itzikowitz and Era Gunning (ENSafrica | Banking and Finance) explain.


Can a party rely on COVID-19 to escape its contractual liabilities?

Maybe. It will depend on the background facts to the contract and the terms of the contract itself. It will also depend on whether the declaration of a national state of disaster will trigger a force majeure clause in the contract or whether the South African common law principles of supervening impossibility of performance applies. Every contract needs to be considered on a case-by-case basis. This article by Jason Valkin (ENSafrica | Corporate and Commercial) offers some insight and practical advice on what can be a complex area of our law.


A pause in corporate governance?

The disaster management regulations prohibit gatherings of more than 100 people (provided that during the 21-day lockdown absolutely all gatherings save for small funerals are prohibited). This means that any company holding a shareholders meeting in the next 3-month period (which period could be terminated earlier or extended) must ensure that the meeting is held 1) by electronic participation (unless the company’s MOI prohibits this) or 2) on a date after the termination of the prohibition on gatherings. Brian Jennings (ENSafrica | Corporate Commercial) share his insights.

B-BBEE verifications in a world of social distancing
The COVID-19 pandemic is changing the way we live, interact and conduct business. The B-BBEE world in South Africa is no different. Under normal circumstances B-BBEE verification agencies must follow the procedures prescribed by the South African National Accreditation System ("SANAS") in performing B-BBEE verifications. These procedures entail that a verification agency must base its verification on information that has been verified by an on-site visit to the measured entity. In an attempt to address the health challenges presented by the pandemic, and in order to promote social distancing, SANAS has temporarily relaxed these requirements. It will now permit verifications to be completed via a remote process. Sanjay Kassen (ENSafrica | Corporate Commercial) explains.

Extension of time for B-BBEE submissions during lockdown
No submissions, filings, responses, documents and/or other correspondence will be accepted by the B-BBEE Commission during the 21-day lockdown. Parusha Desai Valodia (ENSafrica | Corporate Commercial) explains how this will effect entities who are obliged to register major B-BBEE transactions and/or submit annual B-BBEE compliance reports in that period. Click here to access the full article.

dispute resolution

Litigation amidst lockdown

The Chief Justice of South Africa has said that even in the case of a state of emergency, the Constitution empowers the courts to pronounce on the validity of the declaration of the state of emergency and related matters. Accordingly, the courts have to stay open in case members of the public want to challenge the constitutionality or validity of the measures being implemented by the South African Government. He has also authorised all heads of court in the superior courts and magistrates/lower courts to issue practice directives to enable access to courts in relation to any urgent matter, bail applications, maintenance, domestic violence related matters and cases involving children. Follow this link to read more about the directives which have since been issued in the respective courts – by Michael Gradidge (ENSafrica | Dispute Resolution).

"Uh, you have Corona!"
A word of caution to employees. If an employee makes an unsubstantiated allegation that a fellow employee has been infected with COVID-19, it may attract dire consequences. It could 1) lead to stigmatisation, 2) be considered an impairment of dignity, privacy and reputation and/or 3) constitute harassment, and may result in disciplinary action being taken by the employer. It may also give rise to a defamation claim. Finally, in terms of the national disaster regulations, anyone who intentionally misrepresents that he/she or someone else is infected with COVID-19 is guilty of an offence. Read the full article by Tumi Modubu (ENSafrica | Dispute Resolution) and Prencess Mohlahlo (ENSafrica | Employment) here.


Create a safe working space, communicate with employees, and close doors as a last resort

Peter le Roux and Lauren Salt (ENSafrica | Employment) provide practical guidance for employers and some alternatives to consider before retrenching staff. See here and here to read more. Separately, on 17 March 2020, the Department of Labour appealed to employers to use the prescriptions of the Occupational Health and Safety Act, 1993 in governing workplaces in relation to COVID-19, and issued its own guidelines on readying the workplace for the impacts of the coronavirus. Lauren Salt gives an overview.

What does South Africa’s travel ban mean for employees and employers?
South Africa’s COVID-19 travel ban will have sweeping implications for employers and employees, especially multinationals who rely on foreign nationals in the running of their businesses. Have a look at the full article by Zahida Ebrahim (ENSafrica | Dispute Resolution) and Lauren Salt. 

Special COVID-19 leave benefits for employees in self-quarantine
South African law does not currently recognise "quarantine leave". Accordingly, the Department of Labour recently announced special benefits to cater for this issue. These special benefits entail that an employee who contributes to the Unemployment Insurance Fund ("UIF"), and who has agreed with his/her employer to go into self-quarantine for a 14-day period due to COVID-19, will be entitled to claim illness benefits from the UIF. Lauren Salt explains how the leave application process will work. At this point it is still unclear whether these special benefits will continue to be recognised by the UIF when the pandemic has been contained and when its impact on workplaces has been reduced.

Respite for employees in the clothing and textile industries
During lockdown they will be unable to tender services in the normal course (as they are not providers of permissible "essential services"). This has created great uncertainty regarding whether they will be able to earn wages and sustain themselves and their families in the coming weeks. In what has been hailed as ground-breaking, the trade unions and employers’ organisations that are party to the National Bargaining Council for the Clothing Manufacturing Industry have concluded a collective agreement which clarifies that these employees will continue to get paid during lockdown. Click here for the full article by Pareen Rogers (ENSafrica | Employment).

TERS and the National Disaster Benefit
The Commission for Conciliation, Mediation and Arbitration (“CCMA”) has published a statement that provides much-needed clarity on the options available to employees, employers and CCMA users in the midst of the COVID-19 pandemic. This clarity has subsequently been augmented by the "Covid-19 Temporary Relief Scheme (C19 TERS), 2020" directive by the Minister of Employment and Labour, as well as the updated "Guide for Employers on Reduced Work Time, Illness and Dependants Benefits" released by the Department of Labour. Lauren Salt gives an overview.

landlord and tenant

The impact of COVID-19 on leases: landlords and tenants in a difficult position

The national state of disaster and lockdown regulations place certain pressures on businesses, particularly tenants who, notwithstanding their business circumstances in the current economic climate, now have to comply with those regulations. As a consequence, landlords will face the possibility of defaulting tenants. On the other hand, the regulations may trigger a force majeure clause in lease agreements which may in certain circumstances entitle tenants to suspend performance of their contractual obligations. Click here and here to read the full articles written by  Philip Geromont (ENSafrica | Corporate Commercial) and Andrew Bembridge (ENSafrica | Property and Real Estate) respectively.

mine and occupational health and safety

COIDA compensation for employees who contract COVID-19

Compensation is now available for employees who are infected with COVID-19 if 1) the infection occurred in the course of employment and 2) the risk of infection was incidental/necessary to their employment. Here is the full article by Willem le Roux, Pieter Colyn and Celeste Coles (ENSafrica | Mine and Occupational Health and Safety).

technology, media, data protection, IT security and business continuity

Pandemic mitigation vs privacy

The coronavirus’ serious effects on an individual’s health and its contagious nature may be viewed as a "hazard" which requires employers to take steps to prevent and mitigate its effects in the workplace. As such, employers may consider asking employees and other persons (e.g. clients and suppliers) questions and request some personal information (including health information about symptoms of the virus) to ascertain whether these persons are at risk of having the virus or being able to transmit it to others. But organisations should never overlook the rights of employees in terms of data protection legislation. Read the full article.

Working remotely and ensuring IT security
With the outbreak of the COVID-19 pandemic, many businesses have requested employees to work from home. To work from home employees will use their own personal devices or company-issued equipment to access the company network remotely or to transmit information through their own personal network. Ridwaan Boda (ENSafrica | Technology, Media and Telecommunications) gives a few basic tips to address the inherent information security risks that are posed by these arrangements.

Are ICT services "essential services"?
Unfortunately the lockdown regulations are far from clear and explicit about whether ICT services, including datacentres, fibre optic infrastructure, towers and antennae, qualify as "essential services". Ridwaan Boda explains.

How to lawfully run your business electronically in a COVID-19 era
Ridwaan Boda clarifies what will constitute valid and lawful electronic contracting, signatures and meetings. Access the full article here.

Obligations of the electronic communications sector amidst Coronavirus (COVID-19) issued
Directions for the electronic communications sector were published by the Minister of Communications and Digital Technologies on 26 March 2020. Their purpose is to ensure the smooth operation of the electronic communications sector (being "essential services") during the disaster period to combat the spread of COVID-19 in South Africa. Tracy Cohen and Wilmari Strachan (ENSafrica | Technology, Media and Telecommunications) provide a summary of these directions.