August 16, 2021
Following the various types of lockdown measures introduced to limit the spread of Covid-19, many corporations had to pause their work or continue only with limited capacity. Small companies especially took significant losses and many were forced to shut to staunch the financial bleeding. However, it is worth noting that the law has options to help save a distressed company. Republic Act No. 10142 (the Financial Rehabilitation and Insolvency Act of 2010, or FRIA) encourages struggling businesses – including sole proprietorships, partnerships, corporations and individual debtors – to undergo rehabilitation. The FRIA does not apply to banks, quasi-banks, insurance companies or pre-need companies, all of which are governed by different laws and regulations. Rehabilitation allows for the continuation of corporate activities as a business is restored to solvency (Wonder Book Corporation v. Philippine Bank of Communication, G.R. No. 187316, 2012). The process may be court-supervised (which may either be voluntary or involuntary, depending on the initiator), follow a pre-negotiated plan or use out-of-court or informal proceedings. Court-Supervised Rehabilitation If a business is unable to pay its obligations, an insolvent debtor may voluntarily begin a rehabilitation proceeding by filing a petition with the court. The party who can initiate the petition depends on the type of business. For instance, if the company is a sole proprietorship the party will be the owner. If it is a partnership, initiation will require agreement of the majority of the partners. And in stock corporations, the party will be a majority vote of the Board or trustees, authorized by at least a two-thirds vote of the outstanding capital stock (or of the members, in...
August 16, 2021
IHC: WHAT IMPACT WILL THE COVID-19 PANDEMIC HAVE ON THE FLEXIBLE LEGAL SERVICES MARKET? Nair: The new way of working only reinforces what we have known for some time: that flexible working and productivity aren’t mutually exclusive! Clients are now much more open to consultants supporting them from other jurisdictions and, given the advances in communication technologies, teams can still collaborate without needing to be onsite and physically present. This opens a whole new world of opportunity for legal consultants and gives clients access to a much wider pool of talent. IHC: WHAT ARE THE PRIORITIES FOR IN-HOUSE COUNSEL AT THE MOMENT, AND HOW ARE YOU HELPING YOUR CLIENTS MEET THOSE OBJECTIVES? Nair: We are lucky to have the opportunity to speak with legal leaders across a range of industries to better understand their most pressing issues. Pinsent Masons’ flexible resourcing unit Vario is now comprised of Brook Graham (Pinsent Masons’ specialist Diversity & Inclusion consultancy), Client Consulting and Legal Project Management. This puts the firm in a unique position to speak to clients about matters beyond the more traditional remit of the legal team. Most seem to agree that, while we won’t soon see a return to the more buoyant market conditions of early 2019, we must accept our new environment and find ways to operate within those parameters. Some of those priorities are sector specific while others transcend industry lines. For example, because of the pandemic, there is a renewed focus on Health and Wellbeing along with ensuring employees feel well supported as they navigate the challenges of working from home or supporting sick family members. Several...
May 10, 2021
Given the disruption suffered by many businesses due to the Covid-19 pandemic, many employers will be asking a very important question – can our company require all employees to vaccinate against Covid-19? What is at stake? Employers will be seeking to ensure the wellbeing of their employees and the safe and continuous operation of their business. This has to be balanced against the right of an employee to choose whether to take the vaccine. Although the risks are low, vaccines are not risk-free and employees may object to taking them on other grounds. The answer to this question is dependent on the principles of contract, legal obligations, constitutional protections, and labor law protections. The below takes a holistic view taking all these principles into consideration. Mandatory vaccines unlikely to be permitted under existing agreements Most companies in Thailand will have generic statements in their work rules, internal regulations, and/or employment agreements along the lines of “employees shall abide by any valid and conscientious direction of the supervisors, management, and the company.” It is exceptionally rare for any of these documents to explicitly state that the company has the right to request  employees to vaccinate. Therefore, the question is, can you still legally request the existing employees to vaccinate without any explicit assistance of these documents and given the current circumstance? As there is no clear Supreme Court decision precedent for this specific situation, we must therefore look at this from other perspectives. Firstly, as outlined above, there is no contractual stipulation in the employment agreement that will allow the company to request the employees to vaccinate. It is also...
April 28, 2021
A few weeks ago, Metro Manila marked the one-year anniversary of its first Covid-19 quarantine. Now, the National Capital Region and other nearby provinces – dubbed the “NCR Plus” – are back under the strictest quarantine regime. We can still vividly recall the deserted streets when the strictest quarantine was first imposed. Initially, only the businesses doing essential work could operate. Even then, not all employees could work due to safety reasons, not to mention the hardships from no public transportation. The country essentially came to a halt. Eventually, businesses and workers alike accepted the grim reality that everyone had to sacrifice. Thanks to the wonders of modern science, vaccines for Covd-19 came at breakneck speed. Distribution of vaccines started late last year and the rollout has now reached the Philippines. Businesses are feeling more optimistic and everyone is eager to rebound. At this early stage, though, it is interesting to note that, many individuals are nervous about being vaccinated. People are asking if employees can refuse the Covid-19 vaccine. On one hand, refusing the jab is a matter of personal choice and the Philippine Constitution and laws guarantee an individual’s right to freedom, especially about health matters. The state has the mandate to regulate relations between workers and employers in affording full protection to labour. Presently, an employer is merely required to provide for employee viral testing and maintain a safe work environment. Also, no law mandates the Covid-19 vaccination of employees in the workplace. On the contrary, the Department of Labour and Employment (DOLE) recently issued Labour Advisory No. 03, Series of 2021, on March 12 essentially...
February 23, 2021
By: New measures to curb the “second wave” of COVID-19 cases have been introduced by the Dubai Supreme Committee of Crisis and Disaster Management (the Dubai Committee) and the Abu Dhabi Emergency Crisis and Disasters Committee for COVID-19 Pandemic (the Abu Dhabi Committee). On 1 February, the Dubai Committee announced that, effective the following day and for the duration of the month of February, all pubs and bars in Dubai must close, while restaurants and cafés must close by 1:00 am. Shopping malls, hotels, private beaches in hotels and swimming pools may operate at 70% capacity. Theatres, other indoor venues and sports venues must operate at a maximum capacity of 50%. Entertainment activities in restaurants and cafés are no longer permitted. The Dubai Committee has urged the public to report violations by calling the Dubai Police or by using the Dubai Police App. There have been reports of recent prosecutions for violations, including the imposition of fines. On 7 February, the Abu Dhabi Committee announced that, effective the same day and until further notice, parties and gatherings are prohibited and theatres shall be closed. No more than 10 persons may attend a marriage ceremony or a family gathering, and no more than 20 may attend a funeral or mourning service. Malls are limited to 40% capacity, and gyms, private beaches and swimming pools are limited to 50% capacity. Restaurants, coffee shops, hotels, public beaches and parks may operate at 60% capacity. Taxis and buses may operate at 45% and 75% capacity, respectively. The Abu Dhabi Committee also announced new rules on entry into the Emirate of Abu Dhabi, effective...
February 23, 2021
In the beginning of the COVID-19 (coronavirus disease 2019) pandemic, strict government regulations were imposed as an attempt to stem the transmission of the virus. These restrictions required business establishments to put their workplace operations on hold, save for businesses deemed necessary to provide basic necessities. While the regulations were meant for the immediate protection of people’s health, their adverse economic impact was deeply felt by establishments relying heavily on actual customer contact. To keep their businesses afloat, employers needed to adjust to the demands of the situation by adopting flexible work policies. Indeed, while businesses were forced to operate at a reduced on-site workplace capacity, technology made employees conveniently accessible to their employers. This ensured the on-boarding of every employee daily and, effectively, serves as a prelude to the new normal business operations. Undeniably, physical interactions are still key for some industries and work productivity in the workplace setting has been proven to be effective. As such, employers cannot be faulted for seeking the “old” normal. However, since we are still without a universal cure for COVID-19, society’s hope for the return of normalcy would rely heavily on safe and effective vaccinations. Given that the government’s vaccination plan prioritizes frontline health workers and other vulnerable sectors, employers are taking charge and are beginning to procure vaccines for their employees. Aside from deciding on what vaccine brand to procure, employers are determining the proper tax treatment of the employees’ vaccine benefit, i.e., whether or not it is taxable as additional compensation of employees subject to withholding tax on compensation. DE MINIMIS BENEFITS In general, all compensation for services performed...