Managing Through COVID-19 Crisis: Successful Crisis Management

Published September 25, 2020 Views: 9


In today’s session of Friday’s With Ed, topics covered included updates from inside Employsure, an insight into the world of workplace relations updates, including wage theft in the news, and successful crisis management during COVID-19.


  • Managing Through COVID-19 Crisis: Successful Crisis Management

    Ed: Hi, everyone, Ed here, checking in for our Friday session. I’m sorry that there was a gap in sessions last week. I was away on holiday. I snuck away for a long weekend. Very nice to be able to do so. But I’m sorry for, that meaning that this got interrupted. It just seemed a bit weird going on a bit of a break in the midst of the crisis. But I think probably, maybe I’m just trying to assuage my guilt about it that we as leaders need to make sure that we’re resting up. Poor Dan Andrew is down in Victoria. Looks like he’s about to keel over any second. So, if anyone needed a long weekend, I think he probably does. But anyway, that’s not why I’m here to waffle on about. I’m feeling a bit ranty today, ranty. That was with the tea, not with anything else. Don’t worry, anyone that was concerned about that. And I’m going… And the reason I’m ranty is because there are various things that are annoying me that have come out through the media this week about Workplace Relations, I’m gonna update you on. So I’m gonna go through those things. We’re gonna talk a little bit about JobKeeper 2.0. So this time next week, we’re gonna come to the end of JobKeeper 1.5, as we’ve been calling it and move into JobKeeper 2.0. It’s a bit of a chat about that. Finally, I’m gonna talk about this thing that you might be reading about called the K-shaped recovery, which doesn’t sound like it’s much good news for small business. And I’ll explain what I understand of that and what I’m saying. Before I do, just a reminder of why we do this session, I suppose to try and get some alignment on it and give it some purpose.

    Hopefully, what we’re doing is providing you with some insights from inside a business as much as anything, how things are going here, what I’m seeing, how I’m managing the crisis here. Hopefully, that’s useful, even if it’s just so you can see how much better you are than me at managing your business. And you perhaps get some comfort out of that. And the second is to do a bit of what we do professionally, which is Workplace Relations, and to give you some insights and updates into what’s happening in the world of Workplace Relations. Couple of updates this week, around, for example, the concept of wage theft that I’m gonna go through, then finally, it helps me. So there really is a purpose to this for me. It keeps me on top of the media to make sure that I’m reading all the right articles. I need to understand what’s going on in my business. But it also gives me a point of focus in the week, which enables me to stay true to the mission that we’re on at Employsure to work our way through the crisis with success and to ensure that we come out successfully on the other side.

    So, that’s a bit about why we’re doing it, just to keep me on track. And I’m gonna move swiftly on then to wage theft, which has gotta be one of the most offensive terms that have come out in corporate-speak in recent years, I think. So, the worrying thing about this concept of wage theft is it’s no longer a throwaway comment used by journalists and so forth in the media about the concepts of underpayment. It’s now become law, not just in one state Victoria, but now too in Queensland, that businesses, employers can be prosecuted for what is called wage theft with the prospect of a maximum of 10 years of jail time if they’re found to be the thieves, which, it really disturbs me because when you read the media on this, and actually even if you go behind the media on it, which, you know, they’ve gotta sell papers ultimately, so it might be a bit prone to embellishing things.

    But actually, if you look at the commentary from the state politicians in Queensland, the relevant ministers on Grace in Queensland, and what she said on that was a couple of things that were just totally… It was like taking a plug socket from one country and trying to shove a plug-in from another country. It just didn’t fit. So she’s justifying this concept of a wage theft law in Queensland. And she says, “The reason I need to do it is that,” she says, “one in four Queenslanders are being ripped off, are subject to wage theft.” I just don’t think that that’s a true number to suggest that 25% of Queenslanders are having money ripped off from them. Bear in mind, less than 25% of Queenslanders work in the first place, but that’s true of all states. No offense to any Queenslanders before you jump on. I’m not suggesting you’re not hard-working types. It’s just that the reality is less than 25% of people work in an economy. But even if you just look at the working people, there’s no way 25% of people are being ripped off. Now there may be a case to argue that 25% of people are getting underpaid by the confusion caused by the very confusing set of modern awards that we’re all subject to. But it does suggest that those 25% of people and therefore, a huge volume of employers, presumably 25% of employers are thieves is just an awful thing to say, frankly. And it really undermines I think, the hard work that employers do day to day to create ultimately and support the economic success for our country. And I just wanna give you a bit of an insight then is to… So there’s that hop, skip, and a jump. She says we need wage theft laws because 25% of people getting ripped off. No, they’re not. You’re fibbing. So you then get into the next thing that gets quoted, which is, “Look at how bad things are.”

    The FWO went after the restaurant industry, just before the pandemic, and it found that they looked at 1,351 companies, restaurant businesses, and they had been underpaying to the tune of 1.2 million. Glorious headline, $1.2 million of people being ripped off. It’s terrible, isn’t it? I’m just gonna go through a very brief exercise to make my point here with my big calculator. Many of you may not see one of these before. If you just use your phones and so forth, these days, I still hang out with my old fashion calculator. But if I do $1.2 million, and I divide that… Let me just check my math is correct by what the 1,351 businesses. That means each business on average is underpaid $888. So it doesn’t sound great, initially. Let’s divide that by let’s say five employees in each business. So let’s assume they’re all pretty small businesses, they’re probably gonna be bigger than that, to be honest, as restaurant businesses, but let’s say 5, that means $177 per employee. On average, let’s say the employees in that workplace work for them for a couple of years. That gives you $88 per year per employee, divided by a week gives you $1.7 per week per employee. Now, I think it’s absolutely shambolic that a government would gauge itself, which ultimately is just political point-scoring in the idea of calling small businesses thieves, when no one’s trying to cut the corner of $1.7 per week, not even per hour, per week per employee to make more money. The reality is they’re doing it because it’s so bloody hard to administrate wages in Australia because the award system is so bloody complex, that people make errors. And we see the errors in Woolworths and Westpac recently, and huge businesses that yes, should know better and should have the systems in place to know better, but the reason they fail is because it’s so bloody hard.

    There is no one sitting in a Westpac boardroom or a Woolworth’s boardroom saying, “You know what guys? I have worked out a way how we can get our profits up this year. Let’s screw the little guy and not pay him his minimum wage.” It just doesn’t happen. But instead, these governments have rushed through a bit of some political posturing, which we all know in Queensland, it’s pretty prevalent at the moment in order to start sort of stigmatizing small businesses. And I find it really bloody insulting, as you can tell from my tone. But the idea is small business owners could face 10 years in jail because they’re trying to do the right thing in a system that’s so hard. All it does is dissuade people from running small businesses. Why on earth would you go into small business? We all know that running a small business… We might have thought when we got into it that we were all gonna become millionaires by running small businesses, but the reality is small business owners aren’t millionaires and not people that are out rotting systems. They’re trying to make ends meet and quite often are not paying themselves minimum wage because they’re simply having to try and make ends meet for their employees. So I find it pretty bloody insulting that that’s the tone of the political debate at the moment. And that political debate goes into the reforms meant to be going along at the moment. There’s all these sort of secret committees, which is never particularly been having no idea why Christine Porter set up these secret committees. No one really knows who’s in them. We don’t know who’s meant to be discussing our future as employers.

    I’ve certainly not been asked as an employer whether I’ve got any views on it, which is a bit odd, if you bear in mind, I’m not only an employer of 900 plus people, but we’ve got 27,000 small business clients who have very real views about what’s going on in the employment world. But what we saw this week was there was a big blow-up great surprise. I predicted on here, like, some sort of Workplace Relations [inaudible 00:10:00]. I’m gonna claim… I predicted on here that these discussions would go nowhere and fairly predictably, they haven’t. What has happened is there’s been this enormous amount of focus on these things called Enterprise Bargaining Agreements, to which I think if you’re watching this as a small business owner, you may have heard of that have really got no relevance to you. About 10% of businesses use enterprise bargaining. If you’re a small business in the construction industry, you might be tied into one by a worksite agreement. But in reality, most small businesses don’t use enterprise bargaining, but they spent oodles of time discussing how they can improve enterprise bargaining. And what has come out in the last 24, 48 hours is that it seems that the ACTU has been trying to further its nest really, and what they have proposed and they’ve somehow managed to get the Business Council Australia to support this. Remember, Business Council Australia is just a big business thing, really. It doesn’t really affect us as small business owners. But big business representative has said, “You know what? Let’s set up an enterprise bargaining system where things are done more quickly and efficiently if you’re a union member,” which fairly logically would lead to an increased amount of union membership, feathering as I say, the nest of the ACTU.

    And I get this slightly ridiculous thing to suggest, given that only 10% of the private workforce is a member of a union, a tiny number of people are union members. So, again, that would be heavily distorted by things like construction. Outside of construction, a tiny, tiny fraction of businesses, private businesses, private employers would have union membership in their workplaces. So the idea that all of those people who are actually the ones who have less access to legal help, and so forth, should not get the benefit of the same things as the bigger businesses and less their staff of union members. It’s just an awful thing, really. It’s just a fairly transparent attempt to increase union membership, which in a modern world would be probably the only OECD economy where you’d be seeing union membership increase. That’s just not the way things are going. So in response to that, the Master Builders Association who represent a number of building businesses, so they represent about 30,000 building businesses, about the same number that Employsure represents in small businesses across sectors. They got invited to these committees, I didn’t. I’m just saying, but I’m a bit bitter about that. I feel like I’m not being invited to someone’s wedding or something. But they got invited, but they did what I would have done anyway, which is they walked out in response to the suggestion that there should be this two-tier system. And I think it was a very reasonable thing for them to do on behalf of their small business members who would have been outraged at the way these conversations going or outraged. I feel like there’s a shock jock just giving outrageous outrage and anger today, lots of anger.

    So, less anger on this one, JobKeeper. 2.0. End of next week is the end of JobKeeper 1.0. So, you should be getting your house in order to work out. And when you can’t really work out the JobKeeper 2.0 with complete accuracy X. You’ve gotta measure to the end of September quarter as to whether you are eligible on the downturn test. Talk to your accountant about that. I’m not an accountant. Speak to your accountant about whether you are eligible for JobKeeper 2.0. But even if you don’t qualify for 2.0, chat to your accountant about whether you’ve had the requisite 10% downturn to become what they call a legacy employer. And I’ll come back to why that’s important in a moment. So if you are JobKeeper 2.0 eligible, you’ve gotta satisfy the wage condition by the end of October. Remember, that means making sure that your employees are paid at least the amount that they would be entitled to under JobKeeper, either for work that they are doing for you or on the basis that they stood down. But there are two types of employees, those who have less than 20 hours are on $750 at this stage of JobKeeper 2.0, $750 fortnight versus $1,200 a fortnight for everyone else.

    So talk to your accountant about that, talk to organizations like us about whether your employees satisfy employment tests, for example, is on a regular and systematic casual. I don’t think that’s the sort of advice you should be asking your accountants for with respect to them. That’s not their area of expertise. And I can answer some questions about that in due course. And then beyond that, make sure you’re checking the employment issues that flow from JobKeeper 2.0. So remember, one of the things before JobKeeper 2.0 got legislated was that everyone was quite scared of this sort of what they called, I think a JobKeeper cliff.

    The subsidy is stopping. And suddenly people are not having the money to employ the people that they had on JobKeeper. And suddenly, they’re being a ton of redundancies, and so forth. And the government’s obviously put this in place to try and prevent that cliff occurring. However, because the test has changed, there are gonna be a number of businesses who are coming to an end of JobKeeper now. If you are one of those businesses, you should have already considered whether you need to reshape your workforce, restructure your workforce, and look at redundancies. You’re too late to be honest if you haven’t because any process now is gonna take more than the following week. So you’re gonna have the costs going outside the boundaries of JobKeeper, of going through processes relating to that.

    So I hope that you haven’t had your head stuck in the sand on that. But if you have, I’m not gonna judge you on here, just ask the questions, and I’ll see what I can do. But if you’re not a JobKeeper 2.0 business, but you are a legacy business or you’ve suffered a 10% downturn in the September quarter, then you’re still gonna have the ability to do certain forms of stand down, changing in hours and so forth for your staff. And that’s important for two reasons. One, it gives you continued flexibility, which means even if you’re not getting the subsidy, it might be that you can reduce the hours of your staff. You can only do that importantly as the legacy employer down to 60% of their usual hours, as they were at the beginning of March. And what you can’t do is call someone in to do less than two hours work a day.

    Importantly, if they are currently on some form of stand down, you basically need to renew that stand down. You need to do it again and you need to provide seven days’ notice of that. So, remember, it’s only seven days, as from Monday, the JobKeeper 2.0 kicks off on. So you need to be thinking that you’re getting these notices out Monday, and we’re getting a lot of calls for clients today who are needing to understand how to renew or refresh their JobKeeper 2.0 directions if they are a legacy employer and so on. So, you talk a lot more quickly when you’re angry. You know, I’m not really flying through it. I thought I had loads to say but apparently don’t. So yeah, be very aware of this legacy point and what is happening with your staff as we come to the end of JobKeeper 1.0. Just can’t sit there and think, “Well, they were on stand down and they can carry on stand down.” That’s not the case. It’s much more complex than that. And we’ll go through it in a moment.

    So final thing for me before we go on to some questions is this concept of trying to get on here on a K-shaped recovery. And what it’s meant to mean is this, I think is that we came into the crisis in a certain direction. And there are basically three routes out of the crisis. There is up, there is down, and then there is out. And what the narrative in the media is, is a worry there’s an increasing concept of a K-shaped recovery in that there are certain businesses flying as a result of the crisis. Some of those are small businesses but what they’re pointing to particularly is tech-based businesses that were already in strong positions to expand upon the technology they use in their business. So, classically, the biggest one out of the crisis is probably Zoom, that people are saying, like, the circumstances have just created this amazing growth story for them. And these big tech unicorns as they’re sometimes called are just only getting bigger and bigger as time goes on.

    Amazon has also been a benefactor of the crisis. As I say, some small businesses, those particularly that had certain business models suited the crisis better, perhaps were already doing a lot of that transactional work online and so forth, have done well. I can think, for example, a classic one, things like retailers of gym equipment or retailers of bikes were a classic one that really did well out of the crisis. Then you’ve got, so I said, there’s up, which is those and there’s down, which is I suppose most other businesses. You know, I’d count myself probably somewhere near this group in that, look, I wouldn’t ask for the crisis. Again, I think we’ve been very fortunate in that what we do is very relevant to people at this time. But it doesn’t change the fact that we ultimately have a client base of small businesses of 27,000 small businesses who are paying us money. And the problem that we foresee is that those clients are not able to carry on doing that because they’re going out of business, whatever it might be. And that’s not a good thing for us.

    So things have been okay for us, but there are other businesses that will have undoubtedly suffered downturns, but will survive through this crisis. And then the out strand of the K is the risk of small businesses going out of business particularly. And the narrative in the media is that this is increasingly becoming a K-shaped recovery, with that, meaning that small businesses are under real risk. And I don’t want to understate that. There are certainly risks. And, you know, I’m saddened as anyone is when you see shops, particularly in areas like CBD, that just not seeing the point in opening, again, because people’s working behaviors are changing and so forth. But what I am seeing to give any comfort on an economic level. And I think that we’re really a good bellwether of this, because of our scale in terms of the number of small businesses that we work with, across so many different industries.

    But we are not saying yet, and I stress the yet, maybe JopKeeper is supporting this, maybe we will keep an eye on it over the next few weeks ourselves. What we tend to see during this crisis is that where there’s a dramatic change in operating rhythm, Victoria goes into lockdown. For us, we’re in New Zealand as well. When Auckland went back into a lockdown, you see a big sort of reverberation in the small business community of people saying, “I can’t pay bills anymore. I’ve got problems.” And then it settles back down once people have sort of gone out of the worrying phase, into the thinking phase, and critically look at whether they can actually do things and carry on. And what we’re seeing actually is a lot of stoicism from small business, and most people are carrying on. A lot of people, as we’ve talked about on here have changed their business model successfully.

    And I think that that’s a necessity now. And I’m drawing on that realization as a business owner. I quarterly meet with all of my direct reports in the business and have a review with them. And a common theme that’s coming out of that from them, not me, is that they’re sort of saying in their quarterly review this quarter, “I don’t really feel like I’ve done much this quarter.” Now I said it’s funny that isn’t it in the… When I look back to what we talked about at the end of last quarter. We’ve just come through this intense crisis period at the end of the June quarter would have been. And we were all just sort of out of breath from how crazy it had been, and proud, and pleased that we’d sort of stood up to the fight, I suppose. And the narrative at that time was that we felt like, by this time we would be out of the crisis. And the reality is that three months later, we’re not out of the crisis. We’re still in the midst of it, but it’s not quite as chaotic and dramatic and so forth.

    But there is a sense of a new normal. And I think that we’re all coming to the understanding that the answer to what’s gonna occur is neither black nor white. We’re not gonna wind up in a situation where we’re heavily locked down forever, but we’re not gonna be back to normal either, anytime soon. So what we’re trying to do as a business and I’d urge others to do as well, just find out what our new normal is now, what we can actually expect from the business. Let’s get back to where we thought we had good rhythm and routine going in to make sure that people weren’t just in crisis mode all the time. But we’re just working on that now. Because I think apart from anything, it’s pretty exhausting to be in crisis mode all the time. We’ve now gotta deal with a realism that we need to be moving forward and accepting that Christmas isn’t gonna be the end date of this. There isn’t really an end date. It’s going to be some form of evolution over time. There’s not gonna be a switch that gets flicked for any of us, unfortunately, to get back to normal. So, that’s it from me. Over to Stig, for… You’ve got new glasses, Stig. You look like you’re copying me there. No, they’re the same. Stig’s very offended. He’s far trendier than I am. And he’s probably spent thousands on these trendy specs and he’s just been told he’s got the same Specsavers ones as me.

    Stig: I’ve got a couple of pairs, I just choose one in the morning.

    Ed: Yeah, okay. Just casual. Yeah, sure.

    Stig: Ed, just kicking off with a couple of comments from Janai. Good on you for taking a break.

    Ed: Thanks, Janai.

    Stig: Richard says, [inaudible 00:24:41] of your trusty calculator, where’s your Abacus?

    Ed: I suspect there’s a disproportionate amount of small business owners that’s still calculator-based. There’s a… I certainly see it when I speak to clients is quite often you’re in a bit calculated on MDs desks, that seems to probably be a tool MDs still use in small business.

    Stig: And as always, from a colleague, we may come across some financial questions through the course of this. It’s not our area of expertise, we do encourage people to speak to their accountants and registered tax agents, as you’ve mentioned.

    Ed: Who is that mysterious colleague? She appears every week,

    Stig: Stig times 2.

    Ed: Yeah.

    First comment from Anita. She’s a client, Hired. “I’m still unclear if a few of our casual staff who have been on stand down since March 27th, we’re in the swimming industry, 100% closed, but were employed by us for the previous nine months, at the minimum, are still eligible for JobKeeper 2.0. Do they qualify for JobKeeper and do we have to put them on JobKeeper if they are still on stand down?”

    Ed: Hi, Anita. So I think the question is, if I’m right in saying this, they weren’t JobKeeper 1.0 eligible because they were casuals. You stood them down in March, that they had only worked for you for nine months at the first of March. So they weren’t eligible. There hasn’t been complete cloud. So the messaging from the government is that the eligibility rules are not changing for employees. We’ve gotta get clarification on that still. Shout out if anyone’s got this clarification. I can’t see it, I’ve looked online. But, you know, what we know is that from August forward in JobKeeper 1.0 or 1.5, as we’ve been calling it, the goalposts shifted to say, if you have done 12 months as a regular and systematic casual, up to the 1st of July, then you would qualify for that period. It’s not clear whether that… So I can’t say as I said, not clear where that eligibility rule translates since 2.0, meaning that the eligibility test is 12 months from 1st of July, which in your case, would enable those casuals to be qualified. So, first things first, speak to your accountant about whether you are eligible. Hopefully, by the time you’ve got the chance to do that, your accountant will be able to advise as well on whether your employees by eligibility date are eligible. We as a business can advise you whether they’re really regular and systematic casuals, and therefore, whether they should be included in that pool. So I’m happy if you wanna ask more questions on here to talk about their hours and things I can give you a sense as to whether they’re regular and systematic or not.

    Stig: Makes sense. From Naomi, she also is a client. “We have employees that are unable to come into work due to current border closures. They’re on JobKeeper stand down. You mentioned that we can’t leave employees on JobKeeper stand down with 2.0, but they can’t get to the worksite. Do they then have to use their accrued annual leave or go on to unpaid leave?”

    Ed: So hi, Naomi, and thanks for your business. I think this is probably the Naomi that I’ve spoken to a couple of times on here before. Austin, is that her surname?

    Stig: [inaudible 00:28:15]

    Ed: So okay, that might stick for slicing the ball today. But, whatever points reveal of this. Yeah, way around, Naomi. The question there has a couple of branches to the answer. So, first of all, you need to work out whether you’re a JobKeeper 2.0 company, depending on the scale of your downturn. If you are, you have different forms of availability or different levels of access to stand down directions. So if you’re not a JobKeeper 2.0 company, and you’re not a legacy company at a 10% downturn in September quarter, then you don’t have those stand down rights anymore. So, basically, you would have an employee who is not able to do their job, assuming they physically need to be with you to do their job. If that is the case, then you go down the pathway of needing to terminate their contract with them on the grounds of what sometimes lawyers call frustration, which is probably quite an apt term. It’s frustrating that you can’t basically execute the contract, the deal between you and the employer. If you’re a legacy employer, and they weren’t able to come across the border at all, and therefore still couldn’t do zero hours, you’ve got a similar problem in that… That means you’re only allowed to reduce their hours down by 60%. So in essence, you’d still be at zero hours, which would mean, again, you’d have a problem that you’d need to try and work through. And, again, this is all on the presumption they need to physically be with you to work. If you are a 2.0 employer, you would be able to continue the stand down. So, it’s a challenging situation for you there, Naomi, I have to say.

    Stig: And this from Karen. She’s a client from Crofts hired just to confirm, again, even if an employee is currently on unpaid parental leave, they would still be entitled to the full JobKeeper rate and not the reduced amount if they were on annual leave of more than 80 hours per week in the referenced period before the first of March 2020.

    Ed: So, it was Karen, wasn’t it?

    Stig: It was.

    Ed: And Crofts from my recollection are an accounting firm. They’re a client of ours, that if… And maybe there’s more than one Crofts. But I say that because I remember coming to the sales meeting the best part of 10 years ago. So, Karen, if that is you from Crofts Accounting, sounds like you’re an accountant from your question. No offense, Karen, but that’s the most complicated set of numbers I’ve ever heard. I have to get my calculator out to quickly go through it slowly again. And there’s a high risk as well, Karen. I’m gonna turn around and say this is a question for you, and not me if you’re an accountant. So let’s see what she says again [inaudible 00:30:58].

    Stig: Just to confirm, again, even if an employee is currently on unpaid parental leave, they will still be entitled to the full JobKeeper rate, in brackets, and not the reduced amount, if they were on annual leave of more than 80 hours per week in the reference period prior to the 1st of March 2020.

    Ed: Okay. So, the question is, they’re on unpaid leave at the moment, and they were on annual leave prior to the 1st of March 2020?

    Stig: Yes.

    Ed: Essentially, are they eligible for a JobKeeper 2.0? I was breaking the question down, Karen. I think question number one is, are they eligible for JobKeeper 2.0? On any reckoning, the marker there is the 1st of March 2020, given they’re doing annual leave. I’m assuming they’re permanent employees. So yes, they’d be eligible for JobKeeper 2.0 if you as a business are. And then second to that you get into the question of, okay, they’re away on parental leave, which I think you said is unpaid, in which case, you know, as long as they’re not getting paid parental leave, then yes, they would get JobKeeper. But remember that it’s at reduced rates in what they call stage 1 of JobKeeper, depending on their hours. I’m not quite sure on that AT hour piece on the annual leave that you mentioned. But if they’re doing less than 20 hours a week, they’d be on the reduced JobKeeper at $750 in stage 1 or $1,200 per fortnight, if there were more. But if you are a Crofts the accountants, you’ve got accountants down the corridor from you. If you’re working in the HR team there, Karen, then ask them as well.

    Stig: This one is from Tanya. She says, “I missed your company at Friday lunch last week. Anyway, I had a question about calculating JobKeeper 2.0 payment tiers greater than 20 hours. For permanent part time employees, do I just count extra hours work that were beyond contracted hours because they are not, in a bit of brackets, usual or do I literally use the average hours worked in the month of February/June? Some stuff worked extra days, but it was not a permanent ongoing change.”

    Ed: Yep. So, I can’t answer that, I don’t think, not because I don’t know the answer, but because I think it’s probably an accounting question that I’d love to answer, and I apologize for not… You said you missed lunch from me. You might say stuff like that, and you can’t answer my questions anyway. So I’m sorry, I’ll get in trouble if I start trying to unravel that for you.

    Stig: Yeah. This is from Diane, Hired. “Do we need to register for JobKeeper 2.0 or does it simply flow from JobKeeper 1.5?”

    Ed: So you need to have registered. So I was just looking at the ATR website, which is pretty well set out and will set out the process for you.

    Stig: From Roberta. She’s a client. “I have an employee on leave without pay, and has to be made redundant. Do they accrue annual leave while on unpaid leave?”

    Ed: Hi, Roberta, thanks for your business. So employee away on leave…

    Stig: On leave without pay.

    Ed: Without pay, and then they’re about to be made redundant. So, it depends on the basis that they’re on leave without pay and also need to check on your award as well, Roberta, given you’re a client rather than try and guess those things now. We’ll pick up the phone to you today and speak to you about it.

    Stig: Ben says, “Hi, Ed. I have an essential worker who had to make some deliveries recently in areas that are known hotspots. He has since been back into the workplace. If he were to be infected with COVID, would I automatically have to shut down?”

    Ed: So the way in which it would ways back in the workplace if he were to get infected with COVID. The reality of this is that the process goes something like this. If he would show any symptoms, and he’s entitled to do it without symptoms as well, he would and should go and get a test. In that testing process, you get about a 24 hour turnaround that the employee is required to self-isolate during that time, so they wouldn’t be in your workplace. Now, if that test came back clear, you’d be fine. If that employee’s been in the workplace and they came back positive, there’s a sort of machine that takes off, regardless of which state you’re in, by the way, that suddenly kind of takes control of what you need to do in your workplace. And it depends very much on the features of your workplace, how it’s set up, have you got separate operating functions and so forth. But basically the Department of Health in your state takes over and you’d find out from them. But there’s no need to shut anything down or anything like that at the moment. If the employee’s been there, you might say, “Can I recommend that you go and get a test?” You cannot force them to do that. And if they do and go get a test, they’ll have to self-isolate until they get the result.

    Stig: Right. From Rose, “Hi Ed. I have a highly qualified employee whose duties I’m trying to change. To be fair, they are menial tasks below their usual pay rate, reception, invoicing, etc. But we just don’t have the hours right now. We’re JobKeeper eligible, and I believe I have the right to direct the employee to do these. They are pushing back and resenting the change in duties. Do you have any advice on this?”

    Ed: Yeah. So hi, Rose. So, we’re talking under JobKeeper 1.0 I’m assuming. So you’ve got an employee who is receiving JobKeeper. You want them to do the same hours or some of their hours doing other tasks, and they’re saying no. So, you can ask them to do that, as long as that’s sort of a reasonable request. So the debate around it becomes, is it reasonable or not? And it should be reasonable in the circumstances. And really, we’ve said it on here before that most of the answers to problems like this are not found in legislation. They’re found in communication. So, why is the employee pushing back? It’s probably not because of the meniality of the task. In my experience of these things, it would be normally because they don’t understand why they’re being asked. They don’t understand the bigger picture. So my recommendation would be to sit down and have a bigger picture conversation, what I’d call a why conversation, to sit down and explain to them, you know, how we need to mark in and this is part of that, and can we all play our part? And see if you can get through it that way, And if you can’t, then you might escalate into a dispute, but try and solve these things in those ways first before rushing off to legislation and websites.

    Stig: Ed, this question from Mark, a question about the consultation process on redundancy. “Does that give employees a sense of false hope? For some of us, redundancy might be a fire complete. How do we approach this properly?”

    Ed: Yeah. Hi, Mark. So, yeah, I agree with you, I’ve always… I’m less black and white about this than I used to be. I used to be a barrister doing employment law stuff in the UK. And so I’d always see these cases of where we would be arguing that someone did or didn’t go through a consultation process. And that made the dismissal fair or unfair. And I always used to think it was ridiculous at that end of the chain. In what world does an employer really sit down and say to their employees, “Can you tell me ways in which we can avoid this redundancy?” Surely, they’re the business owner. Surely, they’re the ones that have really made up that decision, so they’re just window dressing for the sake of a bit of legislation that makes no commercial sense.

    And there is an element of that. Particularly, I think, as you get into smaller business, like, where you have someone that is in…if you think about the business owner, typically is in receipt of all sorts of information that they know about the business, its economic position, financial position, as well as the forecast of that position, and what’s gonna happen. And they’ve just got more information at their fingertips to then go to someone in an individual role and say, “I’m consulting with you see what we can do to avoid redundancy,” It seems like a bit of a one sided conversation. But there are circumstances in fairness, I’ve come to understand as an employer rather than as a barrister, that you will get good receptive, constructive conversations. And it might be, for example, there are two people doing the same job, can we look at job sharing? And the answer to it, “Maybe no, you can’t or it doesn’t work or the other person doesn’t wanna do,” whatever it might be. But they are valid points that should be considered before you go and take away someone’s job from them. So, look, the short version of that is, it can, not done properly but do try to go into consultation with an open mind because otherwise you are really just window dressing.

    Stig: This one from Karen. “If you’re starting…”

    Ed: She’s back from Crofts. She’s got me again.

    Stig: I think you’ll find this is a different Karen, different tone. “If your staff are only being paid for JobKeeper hours only, that is 10 hours instead of their normal 40 hours, should they be accruing holiday leave on the 10th or the 40th?”

    Ed: So they’re stood down at the moment?

    Stig: It doesn’t say.

    Ed: Okay. So it depends… So what’s basically happened has been a variation of the contract that says that they’re only doing 10, not 40. And typically, what would happen there is that they would only accrue only 10 that they are doing.

    Stig: Okay. This one is from Janet. She says, “Ed, you mentioned in your early streams about communicating with staff and your approach. How does that work for you now that the crisis is lasting longer than we initially thought and it won’t be finished before Christmas in all reality?”

    Ed: Yeah, really good question. It feels like it’s a staged one. There was actually someone from Employsure asking me… It’s something that I’ve be dealing with this week. It’s a real one. There aren’t any staged one, I’m aware of. So I say that… I smile, Riley, when anyone starts a question with you said in earlier, “Oh, what if I said? Maybe I’ve contradicted myself there.” No, I was just thinking this this week. So I do a daily post to everyone on our internet, and I’m now at post 135, which you can see from the amount of people that like it, less and less people, I suppose in the business, they’re getting a bit less interested. And, you know, I suppose you could put an argument together to say, “Okay, then stop doing it.” But to my view, and the litmus test I use about communication is your only communicating well when people no longer need to hear it because they know everything you’re gonna say anyway. They haven’t got any questions. And so I try and keep it fresh. And I do things, just this week, I’ve changed the rhythm of how I do my daily updates. I actually do it on Wednesdays, do a thing equivalent to this live stream, where I just do a Q&A with staff. I have a session with them where I call it a white carpet session.

    I don’t know if I’ve done that metaphor on here before, but I’ll do it in a second just to explain it. But it’s basically a sort of honest, true Q&A session where I promise not to hold the punches, and people ask questions. We did the first one this Wednesday. And I started off with a bit of a spiel about this white carpet thing. And then subscribe questions and there was sort of horrible silence. And I sat here for a moment, but fortunately, someone broke the seal and there was quite a flow of them. But for a moment, I thought, “You know what? I don’t really care if there aren’t any questions. That probably shows I’m doing a reasonable job that people aren’t unsure about anything.” As it turns out, they were unsure about a few things. But I went through those with them. And I’ll continue to do that every week. But that’s just… So I’m now doing a daily post.

    But on Wednesdays, I do the Q&A. And you could look at using tools like that within your business, an open door session. You know, always think about those, you know how MPs have, I think they call them surgeries where people pop in and ask them questions, those sorts of things just to try and keep it fresh. But ultimately keeping communication going. Look, I wouldn’t come back to doing this if I didn’t think there was a need or purpose to it, despite the fact the crisis is going on so long. If anything, actually I think it’s more necessary now. And it’s important that we as business leaders show the discipline now to really drive through this crisis. If you’re giving up in any way could be misinterpreted.

    Just briefly on the white carpet thing, there’s this business metaphor that is meant to be a true story, I suppose. But it’s probably not. The story goes something like this. So Panasonic, the technology business in Japan, they’ve got this wonderful glorious headquarters, apparently. These guests walk into the headquarters one day, and in the reception area, there’s this gleaming white carpet, where all the foot traffic from people coming to visit cross. There’s a guy on the floor on his hands and knees with a bucket and some soap and he’s scrubbing away cleaning the white carpet. And one of the guests says to him, he says, “Oh, you’ve got a difficult job. Wouldn’t it just make it easier if you just put a dark carpet down and you wouldn’t have to clean it all the time?” And the guy looked up perplexed from the floor and he looks at the guest and says, “But if the carpet was dark, then you wouldn’t be able to see any of the stains.” And we talk internally here about being a white carpet organization. There are no secrets there. We operate on an objective and transparent, and fair basis. That’s what I’ve been trying to do during the crisis, I suppose. I’m not keeping secrets from anyone. Secrets cause confusion, cause doubt, cause people to start rumoring and cause dissent. So, that’s the approach I have been taking and I’ll continue to take.

    Stig: Ed., this is from Jill, she’s a client. “We have a staff member going on WorkCover this week for surgery for approximately five weeks. We are currently on JobKeeper. I contacted our insurance company regarding payment, etc., and they’ve said that JobKeeper to them is not classified as income and still have to pay WorkCover regardless, do we have to cancel his JobKeeper temporarily or leave as is? They have said he’s entitled to both.

    Ed: I don’t think there’s an entitlement but there’s a carve-out in JobKeeper for anyone being paid WorkCover that’s entirely off work, so they can’t double-dip on them. So that WorkCover takes over.

    Stig: Okay. And this one from Linda, she too is a client. “Hi, Ed. Do you need to provide your staff with any documentation now that JobKeeper 1.0 is finishing and we won’t qualify for next JobKeeper 2.0?

    Ed: Hi, Linda. So, really good question. So, the documentation should follow the process, so to speak, in that if you’ve got people stood down or any other variations, their usual terms under JobKeeper 1.0. And you’re not gonna be JobKeeper 2.0 or you’re going to be a legacy employer, have a check of that, then you would need to bring them back from any stand down or variations. You don’t have that power anymore. But you do if you’re a legacy employer have a reduced set of powers. So you basically would, in effect by process, you would bring them back then send them away, again, subject to the rules around legacy employers and so on. Or you might bring them back and just have them go back to their normal work. But the documentation which our advice team can provide you would be making sure that you follow the process in writing. So you’d be saying, on this date, we stood you down under JobKeeper enable directions. Those directions come to an end on 20th September, please, therefore, return to work on Monday or whatever it might be that you’re intending to do. But please speak to our advice team to get specific advice about that.

    Stig: Ed, this one from Steve. He’s a client. I have an employee who is regular and systematic, that is historically one to two days per week. Since March, the employee has been full time schooling her children, which one has special needs and needs constant focus and structure. If I asked them to vary their tasks and hours to outside our business hours, and they work weekends and/or evenings to work an average of one to two days a week. Does their award penalty rates apply? Or does JobKeeper directions allow this time to be calculated at normal hourly rates, as they are not available to work their normal day’s hours as a regular and systematic routine? I’m keen to understand how the award/penalty rates work here.

    Ed: Hi, Steve, really good questions. So you might have seen a bit of wrangling in the media about this about. Okay, JobKeeper enable directions allow you to do certain things. But what about the fact that awards also have maybe conflicting rules with that. So the classic conflicting rule that you might be suffering here is that pay rates outside of work hours on weekends and so on, will be at a higher rate. And that may be more than is being provided for under JobKeeper. You’re asking me essentially, do I have to go and top up that money or not? The answer to that, unfortunately, is it depends on your award. And, again, Steve, as a client will get in touch with you to make sure we go through that. It may be that there’s some temporary flexibility afforded under your award. And maybe that flexibility is coming to an end at the end of September, we’ll need to look at all of those things for you.

    Stig: Time for one more?

    Ed: Sure.

    Stig: From Isabella. We have employees in Victoria who has stood down on JobKeeper, our business is deemed an essential service and is able to deliver some services. However, employees have refused to work. What do you recommend?

    Ed: Hi, Isabella. Not an uncommon problem both Vashi and Victoria and outside. So the question if you reverse it is really am I entitled to ask those employees to work? And if you are in some form of a central service in Melbourne at the moment, and you’ve got some subjects certain restrictions and ability to operate, then yes, you’re entitled to ask those employees to come into work. Now, as a starting point, I suppose just using your judgment and empathy as an employer to work out whether there are ways in which you can do this without people who might be fearful of coming into work doing it. Classic scenarios I’ve seen over the last few months are you know people that live with elderly parents or grandparents, they’re worried about being out in the community and bringing back. So there are circumstances that you might as a human, I suppose, look at and say, Look, “I understand it. Let’s try and work around that,” right through to the other end of the spectrum, which is kind of just people pulling your leg and just not wanting to come into work. And the way best way to address both of them really is to have a, what I call earlier in a response, a why conversation, you know, why do I need you to do this? Why am I allowed to ask you to do this? Why do you say that you can’t do it, just trying to have a good frank white carpet conversation with them about that in order to if the right thing to do persuade them to come back in. If they’re not going to respond well to that reasonable approach, you might need to move from the carrot to the stick and start looking at disciplinary issues with them.

    Stig: And Ed, just to wrap up with this comment. Nice one from Sandra. Just on the glasses, Ed, did you steal them from the latest Superman movie? We appreciate your superhero efforts throughout this crisis.

    Ed: I reckon Superman’s would have been more fancy than these ones, but there we go. Thanks, Sandra. Appreciate it. Cheers, guys. See you next week.

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