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Contractual Issues and Income Loss

How COVID-19 could affect your contracts and income

At the moment, large numbers of worried members are contacting us to ask whether they will be able to recover payment for work which is being cancelled due to the COVID- 19 outbreak.

COVID-19 as we now know, has been classified as a pandemic. These are largely unprecedented and definitely uncertain times, and as such it is very difficult to offer general advice to our members.

Loss of earnings

Some members are in a situation where their work has to be cancelled, for instance if they were due to depart on tour to an affected country where travel restrictions are in place. Here the advice is likely to be that they are unlikely to be able to claim loss of earnings.

We will of course do all we can to help our members. However every situation is different based on the specific facts of the case. What we can say in general terms however is that if COVID-19 has directly resulted in lost work, then sadly most members won’t have a case to bring.

If you are suffering immediate financial hardship, we recommend contacting Help Musicians.

Income Tax Deferral

If you are self-employed, Income Tax payments due in July 2020 under the Self-Assessment system will be deferred to January 2021. There will be penalties and no interest for late payment in the deferral period.

When your contract can’t be performed

In English contract law, where unforeseen circumstances which are beyond both parties control mean that it is impossible or impracticable for the contract to be performed, the parties are likely to be excused from their obligations. i.e. you are not obliged to perform and the hirer cannot claim losses against you, and on the other side of the coin, they do not have to allow you to perform and are not obliged to pay you.

A force majeure will only apply where there is a force majeure clause set out in your contract. Having such a clause doesn’t mean that you are in a better position than those that don’t. If the force majeure clause is triggered, you are unlikely to be getting paid.

If you don’t have a force majeure clause in your contract, the COVID -19 situation makes it probable that the contract has been ‘frustrated’. Frustration is a common law principle which can result in similar outcomes as a triggered force majeure clause.

Legal claims for broken contracts

Whether you have a force majeure clause in your contract which has been triggered, or whether it is likely that your contract has been brought to an end by frustration, unfortunately you are unlikely to be able to recover fees for lost work.

Courts will in time no doubt see cases brought in the wake of the COVID -19 outbreak. However they haven’t seen them before, and specific case law does not exist on the subject. Of course, there have been many cases based on force majeure, or the doctrine of frustration.

If you have a query that requires specific advice, please contact your regional office in the first instance. Please be aware that any advice beyond that given here is likely to be limited.

If you are suffering immediate financial hardship, we recommend contacting Help Musicians. You should also read our further advice on sources of help and support, including applications for statutory sick-pay and benefits.

Let us know how you are being impacted