Managing Through COVID-19 Crisis: Impact of the Second Wave

Published August 03, 2020 Views: 14


In today’s ‘Fridays With Ed’ live stream, our Managing Director Ed Mallett covered the impact the second wave of COVID-19 has on businesses, paid pandemic leave, IR flexibility and more.


  • Managing Through COVID-19 Crisis: Impact of the Second Wave

    Ed: Hi, everyone. Ed here. Just taking it slow. Sorry we’re slightly late. A couple of technical problems. We like to keep you on edge. Obviously we were being very concerned that we wouldn’t be on live today, but we are. And here we are. Do I need my headphones [inaudible 00:00:19]. So what I’m gonna today is to give it a bit of structure, we’re gonna try and pick up a bit from where we left off all those weeks ago and develop a bit of a rhythm for everyone as we work through this. Certainly, guys, you did me a favor last week in that I sat down at the end of my first week back after a bit of leave, you might remember I spoke briefly about it. And I’d had a bit of a disruptive week where I’d been a bit frustrated coming back and realizing, as if it wasn’t obvious already, that this whole crisis wasn’t over. In fact, we’re seeing it’s possibly going into a new phase now that we might not have experienced before. And I started to do a lot of worrying, not thinking, and you helped realign me. You helped realign me both in the way that I was thinking, but also in the way I was communicating to the business. And I’m just gonna, therefore, go through a bit of what I was doing thinking-wise and also what I’d encourage you, therefore, to do.

    So a brief reminder that the way that I have approached the crisis has had four stages. I call the first stage, stage zero, which is denial. So I slipped last week back into a bit of denial. And I think there are various versions of that denial and we’ll all be experiencing bits of them at the moment. It may be that we are expressing frustration with certain security guards in Melbourne that perhaps got a bit too affectionate with people in hotels. It may be that we are sick to the gills with the behavior of our local Premier, who has just closed down the borders, which has had a horrible impact on our business. I was reading a terrible small business story in the paper yesterday, a Queensland hospitality business, a hotel resort, and they just had their bookings for this weekend shattered like that during the week, just completely shattered because the…and they got no consultation about it. They have people flying in from Victoria, but also people flying in from New South Wales, and suddenly, all of those bookings are gone, and the huge lump of their potential bookings is now gone. They don’t know what’s gonna happen again. So they’re back to this awful stage of the crisis, which no doubt descends them into stage zero. I think as small business owners, we tend to empathize with that and send ourselves into stage zero and start getting grumpy with politicians and all the other things that go with being in that denial phase.

    No point in being in that denial phase, worrying is not thinking. The important thing is that you come out of that and get into phase one and try at very least to be in phase one, which is of course, crisis management. In that crisis management phase, you’ve gotta sure that you’re going through your routines, going through your processes to keep your business in flow. Keep your business on its toes. It might still be quite a reactive stage. You’re looking and you’re watching the news to see what you’ve got to do for your business, not what you’re gonna be fed up with next, because it’s another decision out of your control. Control the controllables. Make sure that your business is set up well enough to be nimble should what is becoming increasingly predictable happens. So in New South Wales, I would be surprised, certainly, in my planning mindset, and remembering that mantra or strategy of prepare for the worst, but plan for the best. Certainly, in that mindset, I’m preparing that we’re gonna be in some form of lockdown in New South Wales in the coming days or weeks. In fact, I thought it would have happened already. It hasn’t pleasingly, but the business is ready to go for that. There’s not going to be much impact to our operations. If that happens, we know what we’ve gotta do. We’re very organized in that. So that my crisis management meetings at the moment that occur at half 8:00 each morning, we’re actually only lasting a couple of minutes right now because we just say, “Any updates today?” “No.” “Okay, let’s go.” And we get on with what we know we need to do.

    And that’s because, without blowing our own trumpets, we’re pretty good at the crisis management piece. And when it came to closing down our Victoria and our Melbourne office, again, that was pretty easy. When it came to moving our field-based staff back to just doing video conferencing and so forth, that was also relatively easy. So remember this, and I’ll come onto it in a moment, we’ve done all of this before. So whilst it might not be make us happy to do it again, and it might be damaging to our business to have to do it again, we have done it before. The difference this time is this, is that previously, the bar of expectation was very, very low. We all frankly surprised ourselves that we woke up each day and carried on breathing and moving and the whole thing was working to some degree with our businesses impacted in very different ways. But now we know what that low bar is. And the crucial thing is that through better crisis management and through the next stages of the process, we do better this time. And so the second stage of that process is doing your planning. So this should be really an extension of what you’ve been doing before monitoring how the business is performing, starting to realize that even if you’d had some green shoots moving you towards that plan for the best type of circumstance, we really do need to coach ourselves to make sure we prepare for the worst. Funnily enough, in a very twisted way, the way the crisis is unfolding at the moment, is just a really good sobering reminder to us that so much of this is out of our control. It’s not just out of our control, frankly, it’s out of the politicians’ control as well. There’s really very little that can be done to stem what we thought was quite an easy foe, because we did so well against it first time round. And we really need to prepare ourselves for that worst case scenario and accept that things may well go backwards before they then go forwards.

    And finally, and this is important here, is the opportunity phase. When we spoke early in the crisis, we focused a lot on opportunity being pivoting, looking for ways to perhaps make commercial success out of a very difficult circumstance or set of circumstances. But the opportunity also lies in realigning your business culturally, getting it doing all the things that you have been wanting to do for ages. I just saw even one of the big fashion houses on the front of the paper today saying, “You know what? It’s just made me pause and think, there’s so much stuff that we do that’s just a waste of time and we’re gonna simplify, simplify, simplify.” And I think that’s probably a dose of which we could all take into our businesses and say, “Well, why are we doing it that way? Let’s simplify it.” And I’ll come back to a bit about what we’re doing at Employsure in terms of driving that opportunity. So I noticed, by the way, with that four-stage program I saw Josh Frydenberg in the paper talking about how the country is moving out of the emergency phase into recovery. I’m pretty sure he’s just copying me there. He hasn’t credited me for it, which we’ll contact the Treasurer’s office about. But he’s just changing the words really and calling it the emergency phase. I call that crisis management. And he’s talking about recovery. I like to think, unlike Josh, we go a bit beyond recovery here and that we’re looking for opportunity as well. We’re not just all about surviving. We really wanna thrive as well. So, Josh, make sure you give credit where it’s due, please.

    So the next thing to say is this, is that the four-stage system that I’m proposing is not sequential. So you don’t…yes, you’ve got to get your head out of stage zero. But like all of us, and myself included, we slip back into it occasionally, we’re human. Crisis management hasn’t finished. It never finished. It’s going on every single day in all of our businesses, because the thing’s evolving so quickly, and we’ve gotta work within keep crisis managing. You can move forward in crisis management. You might move more into planning, more into opportunity than you were, but then you get yanked back by something like what’s going on at the moment. I feel very much for the Victorian businesses on a larger scale, but I also feel for the businesses. And, say, there’s a suburb here in Sydney called Potts Point, which you might’ve read about where two restaurants have had clusters associated with them. The government narrative that has come out is, don’t go to Potts Point. They haven’t expressly said that, but that’s the narrative as people hear it. In fact, I can say this with confidence, because my wife just canceled our restaurant booking we had in a restaurant in Potts Point last night. And I said, “Why did you do that?” She said, “We’re not allowed to go.” And I said, “Well, that’s not actually the case.” And we looked at the website together. We had a very fun evening, as you can imagine, looking at the government websites. But New South Wales Health didn’t say that. What it said was, “If you have been in Potts Point and you are suffering symptoms.”

    Now, I quite understand that people might be cautious about that, and therefore, say, “I’m not gonna go to that suburb,” because that’s the effect of the government narrative on it. But there are small businesses in there, that are suffering the collateral damage, including the restaurant I didn’t go to last night because of that mixed narrative, overly conservative nature. I heard through another client of ours that’s a restaurant that they said, “Since the Victorian lockdown in Sydney, so nothing to do with the Victorian locked down, their bookings have gone backwards again by 40%. So huge knock on impacts well beyond the government’s advice. And these are the things that you’re gonna have to be working through in crisis management to see how you react and how you plan, including things like what are you gonna do about JobKeeper going forward, which we’ll talk about in due course. But the reality is that this has never been a linear or sequential process. You will always take two steps forward one and step back. And I stress this, if you’re doing it half well, you will be going forward ultimately because you’re taking two forward, one back. Your momentum remains that you’re gonna be going forward. And I’m not just saying this to BS small business owners and give us all a bit of confidence or shot in the arm or air in the tires. I do genuinely believe that, first of all, we’re in a much better position today than we were back in March.

    And that’s I’ve got no idea about the epidemiological position to be honest. It seems like it’s not very good when you read the daily updates and so forth. And I’m not commenting on the likelihood of this thing disappearing or us finding some cure for it or whatever it might be. But the reason we’re better off is that we now know in the business sense, what the enemy is, what the impact is. Remember, back in March, we had no bloody idea, frankly. We were sitting there and saying, “Is this some form of a apocalypse? Are we gonna be actually even sitting here in 20 days time? Will any of us have a business? Will people be at our doors with pitchforks? We’ve got no idea. But the reality is we’ve been through it. And with that lockdown that we had, we saw what happens when you yank on the handbrake, and we’re still here. Now, I say, we’re still here. I know speaking to a number of clients, a number of business colleagues that people have lost businesses, so I don’t wanna sound insensitive to that. But we are physically and emotionally still here. A lot of us are still in our businesses. How well they’re going is a second matter. But we’ve got to now understand that we can do this again. And actually, we can do it better second time round, because you always do because you know exactly how to work through the gears and just make sure that we’re moving forward as we go through the crisis.

    What has that meant for Employsure? So I mentioned briefly that we needed to shut our Melbourne office, and I stressed that we’ve shut our office largely. We still have a handful of people in our office working there. And that’s a bit similar to the fact that I’ve always been here through the crisis on the basis that in New South Wales, we say that you can come into work if you can’t reasonably work from home, and we ask people to tell us that. The test we use in Victoria is slightly different, in that the language used by the Premier there is that you must not be in work unless you can’t work from home. He doesn’t use the word reasonably in the same way that other states do. So we’re expressing just a slight, extra bit of caution there. So these are people that just can’t either for health reasons, technology reasons, whatever it may be. So we take out of the equation performance principally. So we have a number of people in here who say, “Look, I just perform better at work.” Or we know that they perform better at work so we bring them in versus in Victoria that those are people that just say, “I can’t do my work from home.” So they’re still going into the office. And I say that because it’s important to remind ourselves that that is the nature of the lockdown that we’re still suffering in Victoria. It may get worse. It may go to that extra stage of lockdown. But right now, don’t confuse the lockdown in Victoria with anything we haven’t seen before. It is what we’ve seen before. The numbers are starting to escalate and so on. You’re also getting these additional things like face mask requirements. So there are extra, almost peripheral things to the crisis or to the lockdown there. But the fundamentals remain the same at the moment, subject to particular niche nuances in your business about how many people you can have in your premises and so forth.

    So don’t overreact to the crisis, and we’ve always said that on here. Make sure in your crisis management knowledge is absolute power. Know exactly what the government is saying relevant to your industry, and react within the context of that. Don’t overreact, but work out how to communicate to your people, because there’s no point just telling your people that you’re following government advice if they lose all confidence in you and don’t wanna turn up to work. So you’ve gotta work out how to do that communication that we’ve talked about before. A classic one, again, with that restaurant scenario last night. So me telling my wife she was wrong didn’t work as often happens in relationships. I’m probably better at communication here than I am at home. And me just simply trying to show my wife New South Wales Health website was never gonna persuade her of that, and I should have done a more holistic job of communicating about why things were right for us to go and use that small business last night. So I’ve mentioned our Melbourne office. What are we doing in New South Wales? Well, historically what I had said to the business is that we would work to essentially the lowest common denominator of restriction in that all of our offices would follow the same pattern across States and even into New Zealand. The reality is because the crisis has started to take such different paces, we have deviated from that. So our situation, as I mentioned, is different in Melbourne to what it is here in New South Wales. If there’s a form of lockdown here that looks more like the circumstances we were in April, we’ll move back to that. And we’re poised, we’re ready to go on that. So it’s not necessarily that we’re ignoring it or stage zero denying it. We’re ready to go, we just haven’t quickly pulled the trigger. We’re telling our staff that we’re ready to go. We’re communicating to them. We’re helping them feel better and safer around the workplace.

    So one of the things that we’ve done, and I’m not sure if we’ve posted anything on our website about this yet, but we’ve, for example, sent out to all of our staff in Victoria, and we’re starting to roll it into other field teams, depending on where, if you like, the risk level is in different states, we’ve sent them face masks to use. They may already have them, but we’re sending them anyway, just to show a level of care to our staff. We’ve also sent some guidance on how to use them. And the reason for that is we’re saying, “Guys, we actually, we’ve gotta protect you as staff members.” But if you think about what we do, we also need to show small businesses how to do this stuff, both in a communication sense, but also in the protection and use of PPEs. So we’re doing things like that to both protect our staff, but also act essentially as a way of underlining the needs of what our clients should be doing and helping them to understand those requirements. I’ve also, following our session last week, I’ve really tried to increase the communication with my team here, just not really in volume, but in messaging. I’d let it slip a bit. I’d carry on doing daily messaging. I probably haven’t stuck to my own advice, which haxs typically been, you know you’re communicating well when you’re sort of bored yourself saying the same thing. So I’d started to vary the messaging quite a bit, and I’d got away from a couple of core topics. And I noticed actually, when I looked at the business, we were starting to point out good performance based upon sort of pre-COVID concepts. For example, having a record sales day or something like that. That is just not actually the narrative that we wanna carry in the business long term. Never have really, to be honest, but COVID has allowed us to really focus in on the good that we do for small business.

    And we’ve really been banging that drum this week to say, “Look, we’re about helping small business. This really is an opportunity for us to get out and speak to as many small businesses as we can. If they wanna join up and become clients, great. If they don’t because the timing is not right for them, okay. We understand that as well, but maybe the timing will become right later and let’s just wait and see.” But given what we do, it’s difficult to think of a small business at the moment that has employees and doesn’t need some support in understanding health and safety and their employment relations requirements. Things are moving so quickly. People are starting to realize more and more that with the first round of JobKeeper coming to an end soon, they may or may not qualify going forward, and they’re gonna have to make some sticky decisions around things like redundancy. And typically, a small business is saying, “Well, hang on a second. I’m on my knees. If I’ve gotta go through that process, the last thing I need is it working out badly for me. I’m therefore gonna bring in some support and some protection against the costs of any fights that might come out of that.” We’re just trying to instead of saying, “Here’s Employsure’s product. Go buy it, please,” we’re going out and saying, “This is how we help, and we hope that we can help you through this crisis.” And not just in our paid product, of course, but also through channels like this and on our website where you’ll continue to find free resources for small businesses to get you through tricky decisions like redundancy, which is a highly complex process that you’ll need to start considering in a lot of businesses in the coming weeks, if you haven’t already.

    I’ve also realized, as I think you guys probably will have done as well, that in leading a business, you can’t move away at this stage and crucially, you can’t move away from the fact that you’re the chief company cheerleader, essentially. If you’ve got to any fatigue, any frustration, whatever that is, you just cannot show it to your business. And that’s not about being duplicitous in any way or lacking honesty to your business. It’s just a responsibility or even a burden of leadership, really, that you’ve got to keep the energy high and driving through the business, whatever doubts you have. Sometimes, they’re just not gonna be rational doubts because you’re human and things get on top of you. But if you let that irrational get into your business, then you’ll end up with problems. I was talking to my sales director this morning, and I hope he won’t mind me exposing this on here. But I asked him about particular result and I said, “Why do you think that’s down?” And he said, Oh, he thinks that coronavirus is having an impact in that way at the moment. Well, I said, “That’s a big statement. Can we unpack it? Are you doing X, Y, and Z behind it? Can you then…?” And the answer was that in reality, the things that we could control weren’t being done. So at the bottom end of that, we were just using an excuse to say, “Oh, we think Coronavirus is affecting it.” Maybe coronavirus is, but you can’t make that excuse until you go through each stage. And if you do make that excuse, you’ll let the business hear that excuse. And consequently, you’ll find that it’s a self-fulfilling prophecy. And you really need to manage that through your businesses at the moment, because if you think you’re going down the plug hole and you let your employees see that, they’ll certainly start to think it. So you need to be, without running around with a ridiculous grin on your face when clearly things are challenging. That’s not the suggestion. But you do need to be the person that’s leading. People crave leadership now more so than ever.

    So that’s Employsure. What am I seeing in small business this week? And I’m just picking up then into a bit of a short session on technical things that are occurring in the employment relations space. So in small business, I read a good article this week in one of the newspapers that said this…and this I think is one of the really risky things for the government, for people working at big banks and big organizations that are not frankly doing small business day-to-day in the way that we are. There was a suggestion in this article that overall revenue for small business on average in April, May, and June went down respectively 10%, 8%, and 8%. So you could be forgiven for those sitting behind a big mahogany desk somewhere and saying, “Well, it doesn’t sound so bad. You know, we’d give JobKeeper to people that get 30% down. The average is 10%, 8%, and 8%.” Now, obviously. the average disguises certain significant problems and it’s heavily distorted by the fact that construction, which is the biggest employer in Australia and the trades related to construction there are the most small businesses, the most businesses by volume in that industry has actually had quite a good crisis, by all things considered. So construction overall was down by 1% in April, 3% in May. It was actually up 2% in June. Even that’s a bit risky to just assume that everyone, therefore, that drives a U is having a great crisis. I think that, that would be a very risky thing to assume. But that huge volume of those construction businesses drags up those numbers. And if you look at, say, something like hospitality, the data showed that in fact, in April, they were down 60%, 40%, and then 22% in June. So even those are surprisingly high to me given so many businesses are being shut.

    So my point about this is this is that we can all have a crack at being a data analyst. And I don’t know about you guys, but I’m getting pretty fed up with some of the WhatsApp groups I’m on with my mates, who all seem to think that they’re medical specialists now, and they all send me charts on waves and growth curves and our numbers and all sorts around the world. The reality is us looking at those job numbers doesn’t actually really tell the story of what we’re seeing in small business day to day. There are all sorts of variables in those numbers that probably skew them one way or another. You know, looking at someone’s revenue, we know from JobKeeper is a pretty crappy way of working out whether a business is doing well or not. It all depends on how you invoice, when you invoice. I’d suspect that a lot of those construction companies, for example, were invoicing on work that was booked prior to the COVID crisis. And what they’re really gonna be saying is, “What the hell happens for the next two years? Not what the hell happened in April, May and June?” So turning around and saying we’ve got a healthy construction sector is probably a bit optimistic, and as I say, a bit unfair to assume that everyone that’s driving around in a U is doing well for themselves. So it’s also, if you think about JobKeeper, what made JobKeeper frustrating and sort of unfair from the start, is that JobKeeper always disadvantaged businesses that weren’t square shaped go in a square hole. Anything that was round or different shape just didn’t fit in the JobKeeper hole very well. There are plenty of businesses, our own included, where you look forward to what you know is gonna happen over the next 6 to 12 months, and you know there’s gonna be a negative impact. But the nature of your business model might mean that it doesn’t happen straight away, because you’ve got, if, let’s say, you’re a manufacturer, who’s already got orders through the door that don’t get canceled, but you’re worried about the next round of orders. It depends really on things like your revenue and sales cycle. So there are lots of people that just don’t show up in those numbers.

    And what we’re seeing at the front line now is this. Over the last week when in fact a lot’s happened since last Friday. Numbers have continued to get bad in Victoria from a COVID perspective and all these patches in New South Wales. We’ve seen, as I mentioned before, things like restaurants suffering at the front line from echo effects from Victoria or even if that’s not where they’re based. But not withstanding that, what we have not seen here pleasingly is the level of panic that we saw the first time around that. So our call numbers have not shot through the roof again. They’re up, but they’re up for a combination of reasons because amidst all of this, the government added minimum wage to our troubles. So we’re dealing a lot at the moment with people trying to get their wage rates right. So we’ve got an increased number of calls at the moment, but what we’re not hearing is the sort of blind panic that was coming through back in early April, where our numbers doubled tripled, some days it even went beyond that. So that’s good news to me because it tells me probably that we’re all better at managing this crisis now and we’ve got a better understanding as to what needs to be done. We have seen a slight uptick. And I was tracking this really carefully with small businesses ringing us and saying, “Hey, we’ve got financial problems.” And I’ve been tracking it really carefully. My team here says that the reason we went up slightly is because I announced on Friday last week that we speak to small businesses and help them out with any financial problems. I’m not gonna shy away from saying that, because that’s what we do. I’m not gonna hide away from that to help our numbers in any way. If you need help, let us know. And we did see a slight increase this week, which I think is actually very specific to Victoria. So you are seeing a slight problem in Victoria where people are saying, “Crikey, second time round.” My worry remains as I prepare for the worst whilst I’m giving you doses of optimism here, is that there is a risk that there is gonna be a sequence of straws that will break camels’ backs ultimately, and we’ve gotta watch that carefully. And no one knows that better than you and I, because we’re the ones running these businesses and understanding it. And certainly those data points that are in the paper, I think don’t give a very fair reflection of what’s really happening in small business land.

    So what do we do? We get out of stage zero, forget being annoyed with that security guard. Let’s deal with whoever ate the bat in the first place. Let’s get past that. Let’s not worry about what Anastasia Palaszczuk is doing up in Queensland. She’s got her own agenda. It’s not for us to worry about it. It might have just really harmed your business, and I’m sorry if it has, but you owe it to yourself and your employees now to get in stage one and beyond and not sit there and just berate politicians for things that you can’t control. So get out of stage zero into stage one and keep moving forward. That’s the obligation on us. That’s, again, the burden on us as small business owners and managers. In that context, what about employment relations, what are we seeing? So paid pandemic leave reared its head this week. You’ll have seen that in the aged care industry, particularly three awards, Nurses Award, Health Services, and the Aged Care Award. This concept of paid pandemic leave was sort of included into the awards by the Fair Work Commission. A bit frustrating for me, to be honest, to see. To me, having someone like the Fair Work Commission, which is largely a judicial body, sort of interfere with legislative concerns is a bit frustrating. If I was an employer in the aged care industry, I’ve obviously got massive concerns generally. But let’s say I’m an employer in the aged care industry in the Northern territory where there is very little by way of concern about at this time, coronavirus, suddenly, all of your employees have got this right to get paid leave that you pay for by the way as an employer and all they’ve gotta do is tell you that they’re required to self-isolate.

    Now I’m enough of a cynic, unfortunately, and I see it through the thousands of interactions we have with small businesses each day, that when you open up a crack like that, it’s more likely to be taken advantage of than used legitimately. Now, I appreciate I’m going out on a limb saying that because there’s an awful situation in Victoria where they have got a growing number of cases in aged care homes. It’s not to belittle or diminish that problem. And there is some suggestion somewhere, and I don’t have the data and frankly, nor do the journalists that write about it, that, that is connected to casual workers who feel like they need to be present at work because otherwise they’re not getting income so they’re turning up to work when they’re sick. There’s a huge load of causative assumptions there that I think are very risky. And it’s a very, very blunt instrument to suddenly come in as the Fair Work Commission and say, “In this industry…” and by the way, it’s just aged care. So those awards, I mentioned aged care, nurses award, and health services, some of them go beyond the aged care industry, but this extension is very specifically for aged care. So if you’re a nurse not in aged care, you don’t get paid pandemic leave at this time. But that might mean that with time, the government feels some burden to do it, but the people that pick up the burden are small businesses. But frustratingly, the Fair Work Commission sort of said, “Oh, don’t worry about that. The government will sort that out with businesses. They’ll square up the ledger later.” Oh, really? What incentive does the government have to turn around and say, “Hey, aged care businesses. Don’t worry about it. We’ll square up with you after all of this.” The government is not a bank. That seems to be a large misconception that’s going on in the crisis at the moment that every problem that occurs, we rely on the government.

    So I was frustrated, as you can hear, to hear about that extension. I don’t think that’s the way to solve the problem of presenteeism. I think it just creates another problem and likely burden on small business, particularly, if that expands beyond the current narrow boundaries. There’s also talk, talking of problems of the JobKeeper exemptions. The tools that JobKeeper gives you, as an employer, to manage your employees, including JobKeeper-enabled stand-downs. Now, at current stage, those will end at the end of September. We don’t know yet what the clarification is as to whether there’s gonna be any extension. My mate, Josh, aside from the plagiarizing my planning through the crisis, has said quite fairly that he thinks that we need to extend those ER flexibility issues for small businesses so that…and we have this. We have people on JobKeeper-enabled stand-downs at the moment. Now, if that comes to a hard end at the end of September, what do we do about that? We’ve got to suddenly start making some decisions. I hope that my head has not been so far stuck in the JobKeeper sand that I haven’t thought about that. But there is a risk that we see like a mini cliff. Even if other businesses are getting continued JobKeeper support and can carry on with stand-owns and so on, there’s a mini cliff, bearing in mind that that data that I just went out said that on average businesses have only gone down 10% during the crisis. So there will be a lot of businesses that are getting JobKeeper at the moment that won’t qualify for JobKeeper going forward. And that could be a real gunk on the question of whether they carry on employing those people that are on things like stand down. So watch this space. We don’t know yet.

    What I saw and I’m having a real grumble today about various people, but the ACTU came out and said that there is…and this is a close paraphrase of a quote. They said there was no justification for businesses who are no longer struggling to get the ability to do things like JobKeeper-enabled directions. Now, I mean, who on earth there thinks that businesses are no longer struggling just because they don’t hit the 30% requirement for JobKeeper going forward? It’s absolute madness. I mean, the JobKeeper 30% to me is such an arbitrary number anyway. It’s so unfair on the business that hits 29%, whilst their competitor down the road is 31%, and that competitor gets loads of funding for their employees and the 29% doesn’t. Twenty-nine percent is not having a good year. So this concept that JobKeeper creates an established understanding and put a mark in the sand as to what equals good and bad performance is just ridiculous. What seems to be getting talked about is a graded version of this that people that might not get JobKeeper, but are still struggling get the right to do JobKeeper-enabled directions and so on, which I hope is the case. That’s my hope that this happens. And it will happen as part of a bundle of legislation. A reminder, as I stated last week, the JobKeeper 2.0 has not been legislated yet. The question of extension of JobKeeper-enabled directions that are associated with that legislation have not happened yet. If you read the treasury website, you’d think they have. They talk very much in the sense that this has already happened. So I’ll just read what it says, “The JobKeeper payment, which was originally due to run until the 27th of September 2020, will now continue to be available to eligible businesses.” They don’t know that. That’s not actually true. They’ve got to go through a legislative process to work that out. So that’s all up for grabs. There will be a sitting of parliament in August 24th I think it is two weeks. During that, I’d expect the legislation to be debated. In the meantime, we’re sitting here waiting to some degree. You’ll all have questions for me now, and I’m gonna doa lot of, “I’m sorry. We don’t know the answer yet. Our best guess is maybe it goes this way.” But the truth is that even the treasury website is slightly inaccurate. Oh, it’s very inaccurate at the moment because it speaks as though this is happening presumably to instill confidence in the business community, but no one knows yet until that’s actually been legislated. So did we use this phrase last time? So I’ve talked about burying head in JobKeeper sand. I’m now gonna talk about not counting your JobKeeper chickens so all sorts of animal metaphors mixing up. I don’t think chickens bury their head in the sand.

    Stewie: That’s a new one.

    Ed: Yeah, we’ll, mix those up. Anyway, a bit of a rant. I had a third coffee this morning, which I won’t do next Friday. I apologize for that. But those are some updates on JobKeeper also on paid pandemic leave, which is one of the big things. There’s a couple of safety updates specific to Victoria this week. There’s the ability for Victorian businesses to get some pretty hefty fines if they’re not doing the right thing. And obviously, the requirement to wear face marks goes across the state. I think it’s from tonight if it hasn’t happened already. Sunday night. I should clarify. Sorry.

    So those are the updates from me. I don’t know if, Stewie, we have any questions.

    Stewie: We do have a few questions.

    Ed: Great.

    Stewie: And a few narratives coming through. Let’s kick it off with this from multiple viewers, happy birthday for you yesterday, Ed.

    Ed: Thank you very much, multiple viewers.

    Stewie: And more specifically from Janelle Pomeroy. She says, “Happy birthday. Same day as Harry Potter. The inference being you are an HR magician.”

    Ed: Magician was it the bespectacled English guy? One of the above? I’ll take the first couple. Thank you very much. The same day as Harry…I saw, actually, a list of… someone who sent me a list of people who had the same birthday. So including Caroline here in our Employsure law team has the same birthday as me. So I think she’s been with us throughout six or seven years I think now. So happy birthday, Caroline.

    Stewie: And Ed, getting to the nitty-gritty. You’ve actually touched on this just recently, but it worth going back from touch on that again, from Linda. She’s a client. “Hi, Ed. Happy birthday. Any update on how Fair Work Act may change based on JobKeeper phase one ending and phase two, starting? If you can’t get JobKeeper phase two, how do you manage your staff hours if they were on JobKeeper enabled stand down and your business slows again? Do you have to put them back on to full-time hours?

    Ed: Good question. No, there is no update at the moment other than that there’s an indication from the government that they get the problem and that they’re gonna seek to debate that coming into this August 24th date, when they go back to Canberra. It’s quite an archaic system, isn’t it? That you have to wait now until late August for them to get down there and get on with what’s such a fundamental thing to business success. I don’t know why they don’t do it earlier. But anyway, there we go. So there’s no update other than that they get the problem. I get the problem as well. If you’ve got a group of staff on some form of JobKeeper variation essentially, either a stand-down or some variation of hours, roles, and so on, in theory, what happens is as of the 27th September, that finishes, and they must go back to their original hours job and so on, subject to an agreed variation. Of course, remember we talked a lot before JobKeeper where we were saying, it is always open for you to negotiate or consult with your staff and say, “Hey, I need you to be on a stand-down going forward. I can’t afford to pay you. I don’t want to, at this stage, go through a redundancy process because I believe we’ll come back in due course, whatever it might be.” And you might get some agreement from your staff members based upon those sorts of things. Remember, a lot of people were doing things like stand-down and role variations, even wages variations before the JobKeeper stuff came out and enabled a more unilateral right to do that. So whilst it feels like there is this end of the road on the Fair Work variations that came with JobKeeper, there is still the practical reality that you can consult and deal with your staff in that way.

    Stewie: Daniel asks, are there any indications that there may be exceptions and/or different guidelines for particular industries, e.g, sports, arts, tourism in regards to JobKeeper 2.0?

    Ed: Not that I’m aware of either in a workplace relations sense or in JobKeeper sense, and I’m please as a business owner that they haven’t gone for that by the looks of it. Again, it’s gotta be legislated, so maybe that gets proposed by someone in the legislative process, but we’ll see. The reason I say I’m pleased about it is if you think about a business like ours, for example. So we’ve got about 27,000 small business clients across all different industries. Now, let’s say that a particular industry, as we know is impacted like, childcare. We service a lot of clients in childcare, who understandably, are going through a rough time. And we may either have to look at providing them with payment holidays or they might not survive. And there’s all sorts of business impact that flows onto us. But then if the government turned around and said it’s only childcare and certain other industries that get this support, then we supply childcare ultimately, but we’re not a childcare provider. Why are we excluded? And I know many examples of that. Even if you exclusively supply something like the childcare industry, but then you get caught out because you’re considered to be a manufacturer or a retailer or a wholesaler. You know, maybe you provide food to a childcare center or something like that. So I’m pleased they haven’t gone that road because it’s such a web of the whole business world is interconnected. To try and pick on industries is just too hard, I think.

    Stewie: Naomi says, “Hi, Ed. Do you have any suggestions on how to ask your casual employees to stay home when unwell regardless how minor when they don’t receive JobKeeper? They need to pay their bills, but they are not receiving JobSeeker as they’re ostensibly working.

    Ed: Yes. So this is someone who’s not getting JobKeeper by the sounds of it as a regular and systematic casual. So this is someone who is getting paid. So, of course, there are the hardship funds in some of the states. And I don’t know particularly where you are, but there’s a possibility of communicating that to them. I think that you can take depending on the tone of your organization, I suppose you can take sort of anywhere from a friendly to a hard tone on this and really urging and reminding and communicating frequently and regularly the need to take a bigger picture view your fellow employees and looking after them. And making sure you don’t present at work with those. Because ultimately, it’s a pretty short-sighted view because if you’ve got symptoms at all and turns out that you do have coronavirus, then the whole workplace is likely to have to shut down, go through a cleaning, and reorg. And so, it’s going to impact you anyway. So try and take a more pragmatic and appropriate view of your fellow workers. I thought it was something we talked about internally here this week is I’m told that in a lot of Asian cultures where the use of face masks is much more prevalent, even outside the concept of the COVID crisis. Apparently, people wear them not because they’re trying to protect themselves, but because they’re trying to protect others, which I think is a lovely concept in terms of their societies, and it’s a dose of which we could all do with here. And if we take that mindset, rather than the it’s about me. I get it people have got bills to pay, but the knock-on effect of that is huge as if it’s true that presenteeism has caused some of this stuff in Victoria, you can see.

    Stewie: Cynthia says, “Hi, Ed. I’m in Melbourne, and I’m unsure about the new face mask regulations and how they apply to employers. Do you have any insights? How have you handled it in your Melbourne office?”

    Ed: So how have we handle it? So as I understand the regulations there’s not a requirement to wear them inside the office, depending on certain roles. And there’s a sort of reasonable practicability element to it. So what we’ve done is provide some guidance. Maybe we can post on here in response to your question just a template of the guidance that we provided our staff. We’ll put it on the website as well, just to show you the sort of guidance that we’re giving people as to how we interpret the regulations. And as I say, just using the sentiment as well of providing face masks. Now, it’s a personal obligation under the Victorian regulation to have your own, so it’s not that we have to do that. But we’re doing it just to show that we’re doing the right thing to try and give people the confidence that we’re doing the right thing. And then of course, we had to follow as well, the guidance I mentioned earlier of people working from home if they can. So most of our people are at home. And to that extent are, whilst they’re in the workplace at home because of the health and safety legislation and we therefore need to give them the guidance around that as well, they will also be interacting in social environments and personal environments so they have to make their own decisions about their obligations there.

    Stewie: Michelle says, “Hi, Ed. We are JobKeeper recipients. That is all full-time staff and all staff have maintained normal employment activity so far. My question is, what is the minimum notice we can ask staff to take annual leave? Our work volumes have been highly affected by the new lockdowns here in Victoria.”

    Ed: Okay. So you’re in that JobKeeper category of people that have actually had the funding to fund the people who are doing work, which is pleasing in the sense that that’s when it becomes a subsidy to you as we talked about before. So what was a question asker’s name?

    Stewie: Michelle.

    Ed: Michelle. Hi, Michelle. So the notice requirement, what we’ve been saying typically to clients is use a yardstick of about three working days, if you’re gonna the JobKeeper enabled directions on leave. Remember, they’ve gotta have the two-week period stored up in the bank under the JobKeeper extension, so be careful of that. But giving someone reasonable notice, and I think three working days is what we’ve been using here.

    Stewie: Okay. Lorraine asks, when it comes to WHS, what is the definition around everything reasonably practicable? Where can an employer draw the line in the age of COVID? What if I do everything reasonably practicable, but one of my employees still gets sick?

    Ed: Lorraine, was it?

    Stewie: Lorraine.

    Ed: Yeah, hi Lorraine. So, well, reasonably practicable is one of those, and you can imagine a myriad of situations like this. Now, what I would say is that what people are looking for is you to act in good faith from and use best endeavors. So out of the context, not knowing exactly what you’re doing in your business, Lorraine, and the worry that you have. The reality is if you are taking a series of steps, and you’ll get guidance on our website about this, to provide a clean environment in which people can social distance and otherwise adhere to government guidance, then as long as you’re presenting that guidance, you’re not required to militarily enforce it. You know, that’s not the requirement of the workplace where you employ adults. And if you give them the right guidance, you’ve got to instill some element of trust. But if you’re just paying lip service to it, that’s when you’re gonna find yourself getting in some trouble.

    Stewie: David poses this, we have a member of staff who has been paid more than normal through the JobKeeper scheme. We would like them to do a few more hours compared to their normal expectation over a fixed period of time. That is August through December, as the business has a need for this. However, the total amount that will be paid is still less/equal to the JobKeeper amount. We’ll sit down with this employee and get their agreement doing more hours and get their written consent. Also, is this okay?

    Ed: Sorry, who’s the question from?

    Stewie: David.

    Ed: Hi, David. You’re doing the right thing, David. Yeah, there’s nothing wrong with asking an employee to do it. Where people have been getting into trouble is if they force people to in order to top up essentially. So you are entitled to ask. Now, a lot of us can be in the asking because the employee may say no. It depends on your relationship and so forth. But that’s where you get into the art of persuasion with someone and helping them see the bigger picture that this is a good position that the business is in that there’s more hours. It may be short-term. It may be that there is a possibility for them to extend their hours. Be aware that, of course, they could say no. They’ve got various other responsibilities including things like childcare responsibilities that you can’t then go and twist their arm or unilaterally force them to if they say no.

    Stewie: Okay. And I quite like the honesty of this one from Jenny. I’m a bit out of the loop. What happens to JobKeeper post September? Can you bring me up to speed?

    Ed: Hi, Jenny. I feel like I’m out of the loop sometimes so I have a good reason for doing these sessions is that it makes me get back in the loop. So post-September, you’re not actually that far out of the loop, Jenny, because no one knows what happens yet. The government has made a statement to suggest there will be a thing called JobKeeper 2.0 for a narrower group of employers. It’s not clear yet how that will affect who will qualify, but also how that will affect the rights that flow from that in terms of managing your staff. What I’d urge you to do is to have a look on the Treasury website. There’s a JobKeeper factsheet there called the “Economic Response To Coronavirus JobKeeper Extension.”

    Stewie: And time for one more?

    Ed: One more. Go for it.

    Stewie: Okay. From Christine. I have a part-time staff member on JobKeeper who I need to top up. Her partner is unwell and is being tested for COVID as a precaution. We have put her on leave as a precaution until he receives his results. I’m assuming I pay her JobKeeper, but will this be sick leave or pandemic leave?

    Ed: Good question. So, the name so I’m out of rhythm in remembering people’s names obviously. I’m not getting younger. I’m getting older with my [inaudible 00:52:03 ] completely lost it. Christine sorry. So you have a part-time worker who their partner has or may have coronavirus?

    Stewie: Who’s currently unwell, being tested for COVID.

    Ed: Being tested. So government guidance would be that that person should be either working from home if they can, in which case they would get paid to do that work from home. Otherwise, they would potentially go on pandemic leave, which typically is not paid. But given that you’re getting JobKeeper for them, you would pass on the JobKeeper. And I’m saying all that on the presumption they don’t fall under the paid pandemic lane extension from the week. But you would hand over the JobKeeper to them, but only the $1,500 amount. If they normally earn more than $1,500, you wouldn’t be required to give them full paid leave if what they’re doing is going on pandemic leave.

    Stewie: And just to wrap it up, Ed, for this session, your cancellation of your restaurant in Potts Point makes sense knowing full well now that it was your birthday. So this one from Damian. Ed, what are you doing for your birthday?

    Ed: I thought it was gonna be the restaurant I cancelled on. I was grimacing. I do genuinely feel like I wanna pay a cancellation fee or something. I was just, I don’t know, gutted for them they’ll be going through as well. But what did I do for my birthday? I ended up going to a Chinese restaurant, which I love called Lees Fortuna here in Sydney. Good, old fashioned, lazy Susan, Chinese meal with my kids, fairly high on whatever the content of the Chinese meal was running around causing chaos, which was good fun. So I had a very good evening.

    Stewie: Excellent. Well done.

    Ed: Good. Thank you very much, everyone. I appreciate your time and we should see you next Friday. Cheers.

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