As a result of New Zealand moving to Covid-19 alert level4 and the impacts of the Covid-19 pandemic in New Zealand, Chorus issued a force majeure notice under several of our contractual arrangements with our customers.  Force majeure describes circumstances which couldn’t have been anticipated or predicted that prevent someone from doing what they are supposed to do under a contract.

In particular, the notice identifies that our ability to meet service levels are impacted by this force majeure event. As a result, the methodology used for the calculation of service level performance and any service level rebates has changed.

As promised, we now have some more detail for you about the impact of this event on service levels.

[Important note: If you are not sure whether you received the force majeure notice or haven’t received the notice, please contact Erika Morrin as soon as possible.]

What’s happening

The alert level 4 and associated lockdown in New Zealand has impacted the work we are able to do in connecting New Zealanders to our network. While we provide essential services, we are only able to continue certain connect activities (amongst others like fault restoration) in line with Government advice. 

The force majeure notice is important as it means we are excused from those contractual obligations we can’t meet due to the force majeure. The impact of the Covid-19 epidemic in New Zealand (including the movement to Covid-19 alert level4) constitute such an event, which is beyond our reasonable control and limits our ability to carry out our normal business.

What’s the details

Truck roll provisioning

Chorus can only provision those installations that are deemed to be essential services during Covid-19 alert level 4. Non-standard methods that may be required for installation activity, e.g. the use of specially trained and equipped teams to perform work in a manner safe for both technicians and customers, will make it difficult to meet agreed dates. It is expected that cycle times for non-essential orders will increase proportionally.

We’ll use reasonable endeavours to continue to meet all commitments and we will continue to report the service level performance in our various BAU reports. No rebates will be paid where the cause of the missed installation of a truck roll order or Chorus reschedule, or repair date is reasonably attributable to that force majeure event. In calculating provisioning cycle time service levels in our Chorus Customer Core Service Level Report, we will subtract the period of the event (or part thereof) from all calculations when reporting service level performance.  We’ll take this approach for however long it takes for the affected orders to reach completion.

Non-truck roll provisioning

Chorus provisioning of installations or changes that can be performed remotely will continue as normal and we will continue to report the service level performance in our various reports. While reasonable endeavours will be made to meet all commitments, no rebates will be paid were the cause of the missed installation date is reasonably attributable to the force majeure event.

It is important to note failed installations will be treated as truck roll orders and while some may be able to be completed (e.g. mail out of missing power packs), those for non-essential services may have to wait until the restrictions are lifted.

Assure

While Chorus repairing its network is deemed an essential service during Covid-19 alert level4, we expect it will be difficult to meet agreed dates as non-standard methods may be required for repair activity (e.g. the use of specially trained and equipped teams to perform work in a manner safe for both technicians and customers).

While reasonable endeavours will be made to meet all commitments and we will continue to report the service level performance in our various reports, no rebates will be paid where the cause of the missed repair date is reasonably attributable to the force majeure event. We expect the impact of this event will continue even once the Alert level is reduced to 3 or 2. For example, we’re likely to have a backlog of orders and may have ongoing disruptions in our own supply chains/service company operations for some time beyond the date of any reduced alert level.

Next steps

If our analysis of the impacts as a result of this event changes or the force majeure event ends, we’ll publish a further update to let you know what is happening.

Contact

If you have any queries, please get in touch with either Alan Mitford-Taylor or Hannah Croft.