Force majeure clauses are commonly found in many different contracts and at its most basic level, creates an instance where neither party to the contract is held liable to honor the contract terms in the event of circumstance out of their control. With the current effects of the COVID-19 crisis, it is becoming apparent many signatories have not fully understood the terms of the force majeure clauses in their contracts.
Across Canada, most non-essential businesses have faced immense pressure to shut down their operations and this has created a number of issues with regard to temporary layoffs or furloughs across the country. In Canada, an employer does not have the right to temporarily lay off an employee unless it has been expressly agreed to in a contract. This has left many operations in jeopardy due to the fact that they have no work available for their employees, but they also don’t have the legal rights to temporarily layoff their workers.
- The GPS Team
- 10 April, 2020
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