Covid-19 business criminal law and other issues in Monaco

The criminal liability of companies may be incurred on the basis of infringements of the Criminal Code or of specific provisions instituting preventative health and safety measures:

1. The obligation to comply with preventive health and safety measures to prevent the spread of the COVID-19 virus. Law No. 1.488 of 11 May 2020 which was published on 15 May 2020 and entered into force on 16 May 2020 provides for preventative measures in response to the COVID-19 virus, including the prohibition of unfair dismissals and compulsory remote working where possible. The Bill also contains provisions regarding employers’ criminal liability in the event of violation. 
2. Involuntary manslaughter. Article 250 of the Criminal Code provides that in the event of negligence or failure to observe health and safety regulation, imprisonment for six months to three years and a fine of €9,000 to €18,000, which may be doubled in the case of gross negligence (Article 252 of the Criminal Code) is competent. 
3. Unintentional injuries Article 251 of the Penal Code states that unintentional injuries caused by a lack of precautions are punishable by imprisonment for three months to one year and/or a fine of €2,250 to €9,000, which may also be doubled in the case of gross negligence (Article 252 of the Criminal Code). 
4. Ministerial Decision of April 28^th, 2020 establishing exceptional measures for the gradual resumption of activities. In response to combating the COVID-19 epidemic, this Ministerial Decision created new obligations for establishments authorized to resume their activities to implement preventive health measures as of 4 May 2020.

Any fine applicable to legal entities may be increased to five times that provided for natural persons (Article 29-2 of the Criminal Code).

In the event of exposure or risk of exposure to COVID-19 to employees, business partners or the public due to non-compliance with the preventive health measures, business may be held criminally liable for acts committed on their behalf by one of their bodies or representatives (Article 4-4 of the Criminal Code).

The administrative liability of companies may be incurred on the basis of Article 8 of the Ministerial Decision of 28 April 2020, stipulating that the Department of Health, the Department of Labour, the Department of Economic Expansion and the Department of Public Safety may, within their respective areas of competence, monitor compliance with the preventive health and safety measures.

Offending establishments may be forced to temporarily shut down in the event of violation of such measures (Art. 7 of the Ministerial Decision of 14 May 2020 amending the Ministerial Decision of 28 April 2020 on the introduction of exceptional measures within the framework of the gradual resumption of activities to combat the COVID-19 epidemic).

In the event of exposure or risk of exposure to COVID-19 to employees, business partners or the public, criminal liability on the part of senior executives and others may be incurred if, at the time of the alleged event, that individual retains the power to represent the legal entity (Article 4-4 of the Criminal Code).

Case law establishes two scenarios in which employees are considered to represent the legal entity:

• in the exercise of certain functions and missions specified in powers of attorney; and
• regardless of a delegation of authority, when they have the necessary powers and effective managerial authority in the performance of their duties. 1 T. corr., 10 décembre 2013, La Société Anonyme Monégasque dénommée SILVATRIM c/ Ministère public

Thus, in these two scenarios, senior managerial personnel or any other representatives of the company may be held criminally liable on the same grounds and under the same conditions as the legal entity.

As detailed in questions 1, 2 and 5, penalties for the specified offences may:

• in respect of legal entities, amount to fines of up to EUR 180,000 and forced temporary  shut down of business activities; and
• in respect of or individuals (e.g. management personnel), amount to fines of up to EUR 36,000 and imprisonment in response to breaches of these offences.

To date, there is no published criminal or civil case law specifically relating to COVID-19.

Law No. 1.488 of 11 May 2020 which was published on 15 May 2020 and entered into force on 16 May 2020 renders employers criminally liable for violations of the specified measures, specifically:

1. Violations of the prohibition of dismissals except for certain restrictive exceptions are subject to fines from 2,250 € to 9,000 € (Art. 8 of Law No. 1.488).

Violations of the prohibition of early termination of fixed-term contracts except for certain restrictive exceptions are subject to fines of € 2,250 to € 9,000 (Art. 9 of Law No. 1488)

2. Non-compliance with the obligation, when employees work on companies’ premises, to comply with the preventive health measures laid down by the Minister of State, is subject to the following financial penalties:

• between €75 and €200 for the first breach;
• between €200 and €600 in the event of a new occurrence;
• between €1,000 and €2,250 in the event of a warning being issued more than three times within thirty working days from the date of the first breach (Arts. 11 and 26 Law no. 1.488).

These sanctions will remain in force until 18 June 2020 (Art. 3 of Law No. 1.485 of 9 April 2020 suspending the administrative deadlines for dealing with the COVID-19 virus pandemic).

In addition, Ministerial Decision of 28 April 2020 creates the obligation to implement preventive health and safety measures as of 4 May 4 2020 upon establishments authorized to resume their activities. These measures are listed in the annex to the Ministerial Decision and are split into:

1. general measures applying to all businesses;
2. general measures for shopping centres;
3. special measures according to the sector of activity, namely "food stores", "hairdressing salons, beauty salons, nail bars" and "fashion, ready to wear".

Employers will therefore have to demonstrate increased vigilance in the implementation of preventive health measures and ensure that their employees, business partners and the public visiting their establishments respect the new measures.

Telework or distance working remains the recommended option for companies. However, employers are no longer obliged to allow it when the nature of the activity is compatible with the remote exercise of employees’ work and when it can provide the technical and material means. As such, companies no longer risk incurring any criminal fines for not permitting distance working from their employees (Art. 11 of the Ministerial Decision of 14 May 2020 amending the Ministerial Decision of 28 April 2020 on the introduction of exceptional measures in the context of the gradual resumption of activities to combat the COVID-19 epidemic and Art. 10 of Law 1.488).

Employees’ claims against their employers before the Employment Court

Since the implementation of containment and lockdown and more recently since the Ministerial Decision of 28th April 2020, employers in the Principality of Monaco must put in place the necessary measures to protect the health and safety of their employees in response to the risks of COVID-19, failing which they will be held civilly liable.

Civil liability in respect of companies as employers may be incurred if they have not complied with the mandated preventive health and safety measures. In accordance with Law No. 1488 of 11 May 2020 and  Ministerial Decisions of  28 April 2020 and of 14 May 2020, employees may bring an action for damages against their employer before the Employment Court on the basis of the employer breaching the employment contract subject to demonstrating fault, damage and a causal link.

In the event of transmission of COVID-19 to employees within the workplace, their claims for compensation against their employers would presuppose the demonstration of infection at the workplace as opposed to by any other means or at any other location. Given that to date COVID-19 contamination is neither an occupational disease nor a work-related accident, it would be impossible to demonstrate in practice. Therefore, we can de facto exclude this kind of claim.

Tort claims available to business partners and to the public against companies

If companies fail to implement the recommended health and safety measures, commercial partners and/or the public may bring an action against them in tort before the Court of First Instance.

Article 1229 of the Civil Code provides that "any act of man which causes damage to another person obliges the person through whose fault it occurred to make reparation for it".

The success of such claims will depend on the plaintiff's ability to prove that the damage resulted from the COVID-19 virus directly, the company committed a fault and a causal link between such fault and the damage can be proven. In practice, these elements will be difficult for the plaintiff to evidence.

The absence of class action/group claims under Monegasque law

Monegasque law does not provide for a group or collective action mechanism. As such, for the time being, Monegasque companies will not be subject to group claims.