There are two arguments regarding pay and whether you should have to pay your staff (non-essential) or not. This advice has rapidly changed over the past five days or so as the government has been clarifying what their expectations are. Yes, it COULD be argued that effectively pay is on hold when work cannot be offered and an employee cannot take up the offer of work (being able). What the government is reinforcing though is, you cannot just stop paying your staff. It is best to be on the safe side of this argument, don’t stop paying your staff. Talk to us if you need help to see how you can work within the law to make changes to what you are paying staff, particularly through lockdown. Key things:
- You can’t just reduce your employees wages to 80% (or any other amount for that matter) without consulting and getting their consent. Check their employment agreement in case it requires this consent to be written and signed. Otherwise, email consent is fine.
- You need to ensure your employees have time to consider and seek advice regarding a reduction in pay or hours.
- You cannot force your staff to take annual leave (unless you need to go down the track of giving 14 days notice) – you have to consult, due process etc. first for both options.
- You may have a reduction of hours clause you can utilise, perhaps get some advice and of course consult, due process etc.
AUDITING – WAGE SUBSIDY
Make sure you have your ducks lined up and a good paper trail of your business conditions, who you have consulted with (i.e. bank, chamber, financial advisor) as per the subsidy declaration. When the money comes in, speak to your accountant about how to code it in your accounting system, or keep it in a separate bank account and be able to prove it was used for wages only. Our view is, auditing is going to be pretty mandatory over the next few years as things blow over. A lot of money to pay back…
If your employees have work vehicles, if you don’t want those used during lockdown, make sure you specify that is the case. Careful of tax obligations if vehicles are being used during a time when we are not able to ‘work’.
COMMUNICATION WITH STAFF
At this time, it is so critical you are regularly communicating with staff. They are stressed about their futures no doubt and the whole world has been tipped upside down. It is important to make sure they still feel included and part of the company, even if stuck at home. Some clients have set up closed facebook pages, or are sending out regular email updates and having weekly meetings via Zoom.
We have heard of a few businesses sharing all employee contact details. Don’t do this. You are still obliged to maintain your employee’s private information, even though your best intentions might just be to keep everyone in touch. Think of other methods where they get to opt in themselves. If you end up with a staff member who has or is suspected to have the virus, you have some obligations you need to meet in relation to health and safety, but do check privacy obligations first and talk to your employee if you are required to notify.
Kind of a good time to think about a pandemic response policy. Click here for some good online information you could adapt. If you want help with this, let us know.
LIFE AFTER COVID – REDUNDANCIES AND RESTRUCTURES
Yuck, nobody enjoys this stuff. We encourage you to think about life after lockdown and what the future of your business will look like. If you plan ahead, you can start a restructure process during the 12 week subsidy period to make changes to be implemented following the 12 week period (which is in line with your obligations under the pledge). If you are receiving this email, you are one of our clients, so please make sure you talk to us if you need help to go through a restructure process. We recently put together a video presentation about just this. It was a week or so ago though, so things change quickly. All consultation processes under HR best practice STILL apply though guys.
ONE LAST THING
If you think you have stuffed something up in regard to your HR decisions or processes, legislation does allow for you to back up the truck and fix things. Talk to us if you need to about just that if it applies to you. Opps, that didn’t really turn out to be a quick update, but hopefully you’ve picked up something to take away from this update. Stay safe, stay well. Cathe and Tammy-Lee