What are the workforce management considerations for private, mid-market and family enterprises, and how to best enable remote work when changing work arrangements?
The Federal Government has agreed to new and enhanced social distance measures, building on the existing measures announced on 22 March. The new measures to battle the coronavirus pandemic apply from midnight 25 March placing Australia into near-total social shutdown. We published an article focused on the considerations businesses in the hospitality industry should be concurrently addressing – including managing cash-flow, managing their workforce, reinventing their offer and stakeholder communications among others. With these further restrictions soon to be in place these considerations extend to businesses in other sectors such as retail, leisure and recreation, local government non-essential facilities and community facilities.
For some businesses the stimulus package announced by the Federal Government on 22 March will provide relief. However, for others this will not address the financial realities of what is required to maintain employee levels, and employers will be faced with difficult decisions regarding their workforce, such as whether they can stand down employees, managing leave requirements during any shut down or stand down period, and, as a last resort, proceeding with redundancies.
While redundancies provide a reduction of labour costs, they can create cash flow challenges due to the obligations to pay entitlements such as accrued annual leave, notice of termination and redundancy. Redundancies also have a negative impact on the investment made in recruiting talent and training employees over many years. Businesses also need to consider the human effort required to ramp up operations once the crisis stabilises, and the potential impacts of not being able to take advantage of the rebound by not having the right talent and the right volume of people – at the right moment.
So, what options should businesses consider to avoid redundancies, and the legal considerations to keep front of mind? And, when changing work arrangements, what are the pragmatic steps that can be implemented over the coming weeks that will help staff stay connected when working remotely?
Managing your current employees: While there is not a ‘one-size-fits-all’ approach, we believe that employers should be reviewing the options available to manage their employees during this period. These are complicated and fast moving circumstances, and we recommend that you seek specialist advice before making important decisions that affect your workforce. Actions that could be taken include changing working arrangements, adjusting employee roles, reducing working hours or pay, requesting employees to take paid or unpaid leave or, in some cases, standing down employees without pay. Some of these actions require agreement from the employee, and need to be considered carefully to balance both compliance with legal obligations and employee engagement in a challenging time.
For further information, refer to our guide to managing employees during a shutdown.
Other actions to consider for people not (yet) on the payroll are:
Deferring new starters: Where employment offers have been made and accepted, assess whether it is still appropriate for the new recruit to commence at the agreed time, or whether it is more appropriate for the start date to be deferred. It will be necessary to ensure that the deferral of any new starters is consistent with any rights that the prospective employee may have, including under any contract entered into between the prospective employee and the company. If the offer is to be withdrawn, employers need to carefully consider the risks involved in doing so, particularly if the employee has acted in reliance of the offer for example, resigning from their existing employment.
Reducing contingent workforce: while employers may have more discretion in relation to a contingent workforce (either casual or labour hire), an assessment should be made of the need to maintain this – for example if there are any specialist skills required, any reputational impact of ceasing to engage this workforce and the potential future need of these resources given the circumstances.
Ensure succession plans for key positions and critical roles in your business: The risk that key people to the business will not be available due to sickness is increasing, and should be mitigated.
We here at KPMG have by nature a distributed workforce where agility is a daily reality for our business. We have been adapting and rethinking our ways of working just like you have been. We support businesses in most industries around the globe, and have visibility over the challenges businesses are facing to stay connected, where working anytime, anyplace, anywhere is becoming the new normal. We want to share some pragmatic actions your business can take to connect your workforce remotely, to keep your people safe and to ensure your workforce is productive.
It is overwhelming if you feel you do not have the right enablers in place, from a people, processes and technology perspective. We can help guide you to enable agile workplace practices. The enablers for staying connected in this ‘new normal’ are:
Leaders and managers play a key role in the success of remote working. Role modelling is going to be fundamental for the adoption of best practices. Our pragmatic advice to leaders is:
As we move into the new normal our teams will become virtual, our meetings will become virtual, everything will be virtual. We have some practical advice for success of ‘virtual everything’ which you can share with your workforce as and when you implement remote work:
These are uncertain times for all businesses. We must recognise the importance of our people and act to protect them. The efforts to enable the workforce to work anytime, anyplace, anywhere are not only a short term measure. They will set a precedent for a new way of working in the future. We have implemented these changes at our offices at KPMG, and we are here to help you navigate through your challenges.
If you have any questions regarding the content of this article and would like speak to someone from our team please contact us.