Q&As

If there is a government ‘lock down’ for coronavirus (COVID-19), is it possible that employment contracts might be frustrated?

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Published on LexisPSL on 18/03/2020

The following Employment Q&A provides comprehensive and up to date legal information covering:

  • If there is a government ‘lock down’ for coronavirus (COVID-19), is it possible that employment contracts might be frustrated?

For information on workplace issues in light of the fast-changing position in relation to coronavirus (COVID-19), see Practice Note: Coronavirus (COVID-19)—issues for employers.

For information on the doctrine of frustration generally, see:

  1. Practice Note: Distinguishing dismissal from other forms of termination, in particular the section titled: Operation of law, including frustration

  2. Harvey AII[402]–[406.02]: Frustration

The doctrine of frustration is one instance of termination by operation of law: where, without the fault of either party, some supervening event occurs which was not reasonably foreseeable at the time when the contract was made, and which renders further performance of the contract either totally impossible or something radically different from what the parties bargained for, then the contract is forthwith discharged by operation of law. The superseding event must be one that was unforeseen and not catered for in the contract.

The precise terms of each contract must therefore be considered in order to ascertain which circumstances were, or were not, envisaged by the parties.

Typical instances of frustration of a contract of employment involve:

  1. death or serious illness or injury of an individual party to the contract

  2. imprisonment

  3. a change in the law

  4. serious damage or destruction to the work premises

  5. war

However, this is always subject to the express (or implied) terms of the contract that it will continue in the relevant circumstances.

The doctrine of frustration will only be found

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